How can we confidently achieve innovation impact?
Knowledge database Leadership & Culture Structures & processes Strategy & control Data management & digitalisation Integration & interoperability System selection & implementation Human Training & digital expertise D.2: Innovation with impact: evidence-based innovationThe healthcare sector is undergoing change. The many challenges facing healthcare require innovations that are expensive and resource-intensive. The prevailing ideas are diverse and, in some cases, contradictory. So how can we ensure that the most promising, safest and most efficient innovations are pursued and that no misguided investments are made? This requires improved methods of innovation management.
Problem description, research question and relevance
The concept of evidence-based medicine emerged in the 1980s through the work of researchers and physicians. They found that medical decisions in clinical practice were often influenced by the habits of individual chief physicians or the influence of pharmaceutical companies. They therefore called for a form of medicine whose treatment recommendations were based on solid scientific evidence and corresponded to the current state of research.1
The same behavior can also be observed in the management of healthcare institutions. Despite strong intuition and solid empirical knowledge, it is often not advisable to rely solely on the opinions of management.2 Daniel Kahneman explains that it is much easier for people to rely on intuition and experience than to rethink their own opinions and gut feelings. (thinking fast and slow).3 Especially when making decisions involving a great deal of uncertainty, it is tempting to give in to intuition. An unbiased examination of the available evidence is the key to preventing confirmation bias as much as possible.
Decisions regarding innovation involve shaping a future that is often still uncertain. It is important to evaluate new ideas as impartially as possible. Deloitte, for example, assumes that consumers will be at the center of the healthcare model by 2040.4
It is important to take these (possible) changes into account when making innovation and investment decisions and to keep an eye on a time horizon of several decades.
Methods and procedures in the project
Modern innovation management is characterized by the necessary speed and high reliability required to make decisions. Hypotheses should be tested and validated before a decision is made to implement an innovation.5
Based on the Standards of Evidence developed by Nesta, a British innovation agency, an evidence scale was developed in the research project. The goal of developing evidence standards is to help us know (early on) how confident we can be, based on the evidence presented, that an intervention will have a positive impact.6
We want to ensure that we take appropriate risks to fund the most promising innovations.
Evidence should be collected in a structured way to create a common language for impact and to be able to compare different innovation opportunities in terms of potential, risk, and evidence. Evidence requirements should be realistic and proportionate to ensure that we make a positive difference with our innovation decisions.
Results and findings
It is not uncommon for expert opinions or a few qualitative customer interviews to serve as the basis for information due to a lack of (better) decision-making criteria. The problem is that decisions are sometimes made without considering how unrepresentative and biased the evidence from such sources is. This creates a false sense of security. Decisions are made based on a few opinions, but often turn out to be costly mistakes after launch. A high level of evidence, on the other hand, creates a reliable basis for decision-making at an early stage and is therefore the most important success factor for innovation.7
Based on Nesta, the Evidence-based Innovation Scale was defined to help assess how confident we can be in our decisions regarding innovation/investment:
Recommendations for practice
Evidence-based management aims to objectively and impartially incorporate the results and methods of scientific research into a company's decision-making process in order to create comparability and select the most promising innovation opportunities.
Evidence should be reviewed repeatedly throughout the entire innovation process:
Review potential innovations
Before an investment is made, the evidence behind products and services should be evaluated to see where they currently stand on the evidence scale. This makes it easier to assess whether the evidence still speaks for or against (further) investment.
Making investments
When we decide to make an investment, the evaluation strategy is supported by evidence.
Future funding decisions
We will measure the impact of all the products and services we fund, helping us to understand if and how they work and whether we should continue to invest.
Literature and other sources
Deloitte.4 „Forces of change The future of health“, 30. April 2019. www2.deloitte.com/us/en/insights/industry/health-care/forces-of-change-health-care.html.
Dr. Steffen Helbing.2,8 „Evidenz-basiertes Management – Entscheidungen jenseits von Bauchgefühl und Intuition“, 10. Juli 2020. www.compleneo.de/evidenz-basiertes-management-entscheidungen-jenseits-von-bauchgefuehl-und-intuition/.
Hudson Goodmann und ZHAW.7 „Let’s know, innovators“, o. J. assets.ctfassets.net/a6d9ks9iegy2/2aVcsOQzqROD9qFgcr8vgI/650af84b6161f647eb8d105681ec6fdd/240228_Whitepaper_2.pdf.
Institut für Qualität und Wirtschaftlichkeit im Gesundheitswesen (IQWiG)1. „Die Geschichte der evidenzbasierten Medizin“, 25. März 2020. www.gesundheitsinformation.de/die-geschichte-der-evidenzbasierten-medizin.html.
Jannik Böckenholt.5 „5 Fehler im Innovationsprozess, die man unbedingt vermeiden soll“, 18. November 2020. www.lead-innovation.com/insights/blog/fehler-im-innovationsprozess.
Kahneman Daniela.3 „Daniel Kahneman Doesn’t Trust Your Intuition“, 12. Januar 2023. www.youtube.com/watch.
Nesta.6 „Nesta: Standard of evidence“, Oktobe r2013. media.nesta.org.uk/documents/standards_of_evidence.pdf.