There has been an argument for a fair time we need to design and adopt a new Balance Sheet. One made up of Intangibles. For me the make up of any balance sheet is found in its Innovation Capital.

Predictive Management needs to recognize this requirement. So what is innovation capital?

“Innovation capital is the sum of all that promotes the development and changes required for achieving innovation outcomes, within one organization or its broader networked environment, for market place advantage”.

“These are made up of the resources, processes, knowledge and capabilities, that are constantly evolving and highly dynamic to build greater innovating capacity.”

You are searching for what makes-up and provides the true value creation in successful outcomes; in final product, services, knowledge understanding or executing within further business models.

One that is made up of:

Customer Capital- from the networked effect, the dialogues created and valued, the satisfaction and reciprocation, the perceived values and awareness of each person’s contribution

Human Capital- Those competencies, that know how, the tapping into the new sources of talent- internally and externally, and the attitudes to move mountains and achieve

Structural Capital- The underlying value of innovation capacity, the efficiencies within organizations, the exploitation of more fluid organizational structures, the alignment and cohesion necessary

Much is invisible to the eye, much is never calculated on a traditional balance sheet but it is often the different between book value and perceived market value or future worth.

We need to build more of a predictive tool. Why not talk to us on ways forward to build this new balance sheet into your thinking, one that builds upon the Innovation Capital equation of its increasing stocks and knowledge building assets, built on uniqueness and the resources that make this up. Built in constantly evolving and learning ways: adapting, agile and engaged, to make-up the real strategic asset we all need today to run our businesses.