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In a recent column, I fantasized about how quickly the average large publicly-traded company would heed the call to develop a functional innovation capability if it thought this would matter to Wall Street. I tied that fantasy to the notion that there would be a key innovation metric or two that had universal meaning in the financial world.



I'm still hopeful that simple metrics will come along, but in the interim, we need a different incentive. Just as quality became a serious business discipline 20-plus years ago, and is now embedded in most organizations through standard operating procedures, innovation must be developed as a discipline. And we believe that, over the next 20 years, it will be.



Given Wall Street's propensity to stay on top of important business trends, I predict it won't take long for analysts to get smart about what it takes to be an innovation leader. Hence, the forward-thinking analysts who have heard the innovation drumbeat from this publication and others will start asking the tough questions of corporate leaders as they assess a company's real growth prospects.



So here's a fantasy for the interim: A Goldman Sachs analyst gets on a conference call with a chief executive to talk about his company's growth strategy. Let's say this is in a highly competitive industry in which there are no more big acquisition candidates, and organic growth is key to survival. The banking, insurance, or building-controls business might fall into this category, for example.



"Tell me, what is your company's innovation agenda?" the analyst asks.



Based on what I've heard from business managers recently, there are three typical responses, which reflect the company's awareness of and commitment to innovation.



1. Business-as-usual CEO: "What's an innovation agenda?"



2. Toe-in-the-Water CEO: "We've just identified innovation as one of our top priorities. We'll get back to you shortly."



3. Switched-on CEO: "Our top 3 priorities are these, here's how they relate to our strategy, here are our challenges, and look what progress we are making."



Next question: What is expected of the leadership ranks in your organization to support your innovation agenda?



The range of responses might include:



1. Business-as-usual CEO: "Well, nothing special, why do you ask?"



2. Toe-in-the-Water CEO: "We're hiring more creatives."



3. Switched-on CEO: "So far we've been able to get about 250 key leaders to our innovation training program plus we're adding new staff. It's tough to go to school on this stuff, but we recognize that innovation is a new discipline. Leaders at every level will have to master the skills if we're going to foster a culture of innovation within their operating environments, drive more open innovation, teach risk-mitigation techniques, and hold the operating units accountable for testing at least three big potential growth concepts per year."



"Can you point to any direct communication efforts that detail how your innovation agenda is being represented to your various constituents?" the analysts continues.



1. Business-as-usual CEO: "Our VP of R&D hired an innovation speaker for his management offsite."



2. Toe-in-the-Water CEO: "We've just instituted an electronic suggestion box that is noted in our company newsletter. We're paying $250 for the best five ideas that surface each year."



3. Switched-on CEO: "My last five industry speeches detail the technological challenges and market opportunities we are facing; we talk about some piece of our innovation agenda at every PR opportunity; all our internal communications chronicle our efforts, both good and bad. Here's a rundown of awards to our top innovators company-wide. They especially love hanging with me in Nantucket."

"Wow, innovation does seem like it's important to your company," says the analyst. "How much money are you devoting to the effort and where are the funds coming from?



1. Business-as-usual CEO: "Innovation is expected on a daily basis, so we have no specific budget."



2. Toe-in-the-Water CEO: "We cut the annual golf outing from 18 holes down to 9, and we're devoting most of the savings to innovation. We also closed the Starbucks concession out of our call center, so that should about get it."



3. Forward-thinking CEO: "Our Six Sigma efforts don't normally move the needle for us revenue-wise, but they sure deliver a lot to the bottom line. We've started with a chunky seven-figure budget and we expect to double it with the operational savings we create so we can fund worthy innovation projects at all levels in the company."



Finally the analyst starts to poke around at the notion of how nimble the company is when it comes to accommodating the necessary organization changes required of an innovative organization.



"Tell me, since you think you are on the road to being successful at innovation, what does your change-management strategy look like?"



1. Business-as-Usual CEO. "Excuse me, but can you clarify? I don't get the relationship between innovation and change management."



2. Toe-in-the-water CEO. "Our plan calls for an appointment of a chief innovation officer. She'll be reporting to the assistant to the V.P. of R&D, so we're expecting a lot of new ideas."



3. Switched-on CEO: Since our strategy is continually to identify and solve latent user needs there's no telling what this organization might look like in five years. We are committed to doing what it takes to win at adding value to our customers' lives. If that means our asset base and fundamental personnel DNA needs to make a big shift from today, so be it. My organizational-development team is advising me monthly."



If your senior execs sound like the first two leaders, I suggest you buckle up -- it's going to be a bumpy few years. Even our Switched-on CEO has his work cut out for him, but at least he has defined a solid migration path towards being successful at innovation.



While it is fun to poke fun, these quotes reflect actual conversations I've had in the last 12 months. The question is, what will become of the companies ignoring the drumbeat? I think I know. Do you?