The Startup Way: How Modern Companies Use Entrepreneurial Management to Transform Culture and Drive Long-Term Growth

by Eric Ries

Every flavor of innovation accounting is designed to demonstrate validated learning in a rigorous way. As you’ll recall from Chapter 4, this requires showing a change in customer behavior from experiment to experiment. Those behaviors are the inputs to the business model, the leading indicators that drive future outputs like ROI and market share. The innovation accounting process begins with a simple dashboard full of metrics that teams can agree are important. Many teams aren’t yet aware of the drivers behind their revenue projections. They’re focused instead on the financial goals or “outputs”—things like ROI, market share, and margin—and not on the power required behind the scenes to grow them.