In the dynamic landscape of modern business life, it is sometimes better to measure change than concrete results because the way we measure results often hinders innovative leaps.
This shift in perspective in measurement is particularly clear in connection with transformation. For example, in the transition from a linear to a circular economy, where the focus is on promoting sustainability and minimizing waste rather than increasing and streamlining production.
Key figures, measurements and the culture of the previous business then counteract the transition to the new innovative and it becomes obvious why it is absolutely necessary to measure the power of change itself in order to bring about an effective organizational transformation.
Assessment of the cultural change
When you create transformation and leapfrog innovation, there are no metrics for the new things you want to create in the organization.
When implementing a circular economy, it is often more important to evaluate how the organizational culture develops in terms of discussions around circularity rather than how effective the new circular solutions are.
Conducting regular employee surveys can provide valuable insights into shifts in mindset and overall levels of commitment to the new.
By focusing on measuring the frequency and depth of these discussions, organizations can measure and understand the pace of their transition to circular principles in their core business.
Evaluate where the innovation budget is going
The allocation of research and development (R&D) budgets aimed at new initiatives. As an example, circular initiatives, serve as an important indicator of an organization’s commitment to transformation into something new.
By quantifying the proportion of the R&D budget that is intended for the anew, such as circular efforts, companies can effectively measure and understand their commitment to exploring innovative and environmentally friendly solutions.
Tracking these types of metrics over time provides a clear picture of how the company’s priorities and focus are evolving in favor of new transformative systems.
Use innovative projects as milestones
An effective method for understanding the measurement of success lies in using specific innovative projects as benchmarks. These projects can serve as concrete examples of how to quantify the new. Within circularity, this can be about a focus on aspects such as the number of times materials are reused, the degree of utilization and the lifetime of the product in the circular system. Things that do not have such a high priority to measure in a linear system.
Analyzing the progress of truly innovative projects provides actionable insights into the effectiveness of the transformation and helps refine future strategies.
Emphasize the new perspectives
Measuring change within the framework of a new system means emphasizing the unique key perspectives of the new system.
In the transition to a circular economy, this can be about the ability to circulate materials several times, systematic elimination of waste through innovative design and the economic viability of circular systems. These perspectives provide a comprehensive framework for evaluating the success of circular initiatives, guiding organizations toward sustainable practices that promote long-term environmental and economic benefits.
Track new transactions
In the case of circular economy transformations, tracking activities and transactions after circularity instead of before serves as a critical measure for understanding the extent to which organizations adopt sustainable practices beyond the initial transaction. By monitoring the life cycle of products and services, companies can gain valuable insights into how well they integrate circularity into their core business models, emphasizing the importance of sustainable practices throughout the value chain.
This way of following desired activities and transactions in the new system makes it possible to understand the success of the change work instead of comparing the old and new system.
In summary, the shift to measuring change rather than tangible outcomes is critical to understanding the effectiveness of organizational transformations, such as in the transition to a circular economy.
By assessing cultural changes, R&D budget allocations and project milestones in innovative projects, companies can gain valuable insights into the impact of their efforts and effectively guide their transformation towards a new future.