There has been a lot written about how to “best” evaluate ideas in an innovation process. Practically every company working within or adjacent to the space of innovation has created some kind of framework they use to evaluate ideas. While it is not up to us to determine which particular framework works best, we can outline some of these approaches. Furthermore we want to provide our readers with tools to quickly and easily use these frameworks for their own idea evaluation – afterall, that is why we created Rationalize.
The frameworks outlined are broken down into two types – Simple and Complex. The simple frameworks are better for early stage idea vetting. When the stakes are low, it doesn’t make a lot of sense to spend a considerable amount of time trying to gauge the merits of ideas which have not been clearly defined. But the more time and attention has been devoted to each individual idea, the more attention should be paid to vetting those ideas. In addition to that, the more we know about each individual idea, the deeper we can go in assessment of its merits.
Finally, there will, likely, be more posts along the same lines – there are a lot of evaluation frameworks out there and we are aiming at providing a complete library of these. Let me know if there are frameworks you’d like to see featured.
With that, let’s dive into the actual scorecards.
Simple Frameworks
These approaches to idea evaluation are slightly more complicated than a general thumbs up/thumbs down method. Still, they provide a basic amount of rigor when it comes to evaluation. Use these frameworks at early stage of idea development when you do not have a clearly defined concept.
Impact, Confidence, Ease (ICE) – Growth Hackers
This framework can be called a Minimum Viable Idea Prioritization Framework. The idea is to quickly sort the concepts on 3 basic criteria and get the score without going too much into the weeds of the framework.
- Impact: How impactful do I expect this test to be?
- Confidence: How sure am I that this test will prove my hypothesis?
- Ease: How easily can I get launch this test?
Time, Impact, Resources (TIR) – Bryan Eisenberg
Another simple framework for prioritization. Without diving into the details, organizations can sort out their priorities based on:
- Time: How long will it take to execute a project (a change, a test, or full scale roll-out) until its completion? This includes staff hours/days to execute and the number of calendar days until the project’s impact would be recognized. A score of 5 would be given to a project that takes the minimal amount of time to execute and to realize the impact.
- Impact: The amount of revenue potential (or reduced costs) from the execution of your project. Will the project impact all of your customers or only certain segments? Will it increase conversion rates by 1 percent or by 20 percent? A score of 5 is for projects that have the greatest lift or cost reduction potential.
- Resources: The associated costs (people, tools, space, etc.) needed to execute a project. Keep in mind: No matter how good a project is, it will not succeed if you do not have resources to execute an initiative. A score of 5 is given when resources needed are few and are available for the project.
Timmons Model of Entrepreneurial Process – Jeffrey Timmons
Timmons framework focuses its attention on the fit among 3 elements it deems to be critical to evaluation of a startup opportunity:
- The team
- The resources
- The merits of the opportunity itself.
Because the framework focuses on the interaction between the three factors, simple scorecarding of the 3 factors is not as effective as thinking through the interactions. Nevertheless, this framework can be a useful to evaluate ideas in a pinch.
Complex Evaluation Frameworks
These are a bit more involved than the frameworks outlined above. As you devote more time and attention to your ideas, the more dimensions you are able to assess. These frameworks have levels of abstraction to provide an aggregate score for a set of criteria. Use these frameworks when evaluating more mature and formed opportunities.
Should-Could, The Inovo Group
The Should/Could tool is used to compare a set of opportunities on their inherent potential and the company’s capabilities to deliver on that potential. It allows a team to independently assess a set of opportunities along two dimensions to create the Should/Could canvas shown below.
The 2 main dimensions are defined as follows:
- The Should Dimension is about “Should anyone” pursue the opportunity (not “Should we“). It is an assessment of the future potential of the opportunity in the world, regardless of who creates it. Think of the “should” axis as what will drive the S-curve of adoption.
- The Could Dimension is about “Could we” pursue the opportunity successfully. It’s an assessment of the company’s current and future capabilities against what the opportunity will require – how well we could create such an opportunity (alone or with partners) and the likelihood that we could be successful. Think of the “could” axis as how the company can participate in the evolution of the S-curve.
Each of the dimensions, in turn has its own set of sub-criteria allowing a more thorough assessment of Should and Could dimension.
The framework is particularly useful for assessment of a more mature set of opportunities as the criteria used to evaluate these ideas are rather in-depth. Thus a deeper understanding of market size, trends and forces as well as organizational capabilities is required.
Innovation Project Scorecard, Strategyzer
Strategyzer’s Innovation Project Scorecard attempts to assess ideas on 6 basic categories of criteria – Strategic Fit, Opportunity, Desirability, Feasibility, Viability and Adaptability.
Again each of the main dimensions has a number of sub-criteria digging deeper into each of the factors.
PRIME Analysis Framework
The framework was designed “specifically to help address the needs of the substantial and growing number of new and serial entrepreneurs, informal investors, students of entrepreneurship, as well as formal investors who favor an additional opportunity-screening model to recommend or use.” The authors seemed to have tried to popularize the framework by using mnemonics for every set of factors and sub-criteria.
The framework breaks out five main factors which are:
- Product/service
- Resources
- Individual
- Markets
- Economics
Each one of the factors, includes a number of sub-criteria which can be used to analyze the ideas more thoroughly. Product/service factor, for example, includes the following criteria: Superiority, Uniqueness, Protection, Ethicality, Readiness and Business model (SUPERB). The rest of the factors have their own sets of sub-criteria.
I hope these examples have been useful in providing some context for idea evaluation. Feel free to check out our library of idea evaluation frameworks in the Rationalize template library. And, once again, drop me a note if there is a framework you’d like to see featured.
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