Right now it’s hard to avoid the call for innovation, innovation, innovation.

Across the world business gurus and creative firms are extolling innovation as the answer to a CEO’s prayers for growth during hard times. Type innovation + recession into Google, and you’ll be rewarded with thousands of articles, blogs and tweets encouraging leaders to pile investment into new products, services or business models. The general opinion is that those who invest in innovation will be best primed to succeed as the good times come again. Couple this assumption with the ever growing noise around co-creation and open innovation briefs, and you’d be forgiven for thinking that innovation is the next big thing.

But it’s not really, is it? Companies have always done new things, and they always will. Isn’t innovation in danger of being hyped as the magic pill to justify spend on external advisors in a period of cost-cutting?

We may read a lot about how vital innovation is, but at times the process appears deliberately shrouded in mystique. The debate is not whether innovation is a good strategy, but, instead, how it can be leveraged to offer the best chance of success.

What are the risks as well as the rewards? For every example cited of groundbreaking success there are hundreds of examples of expensive failures: For every Disney during the Great Depression there’s a Go.com (Disney’s failed search portal in case you missed it), for every iPod during the dot-com burst there’s a PalmPilot, for every Ryanair there’s a Silverjet.

I don’t cite these examples to prove that innovation is the wrong path to take, but to emphasise how vital it is for businesses to concentrate on a few simple and impactful ideas which will bring real business impact.

The key to rewarding innovation is not generating hundreds of ideas (actually that’s relatively easy); it’s understanding which ideas will have the greatest impact on your business and be the most worthy of investment. To evaluate the impact of your ideas we suggest assessing their impact against the following five parameters:

1. Brand-building impact: which ideas best fit with your brand positioning? Which ideas build your brand as well as leverage it?
2. Market impact: Which ideas have the greatest competitive stand-out? Which ideas have the most sustainable competitive advantage?
3. Financial impact: Which ideas have the best cost return balance? Which ideas have the greatest market size?
4. Strategic impact: Which ideas best fit your overall strategy? Which ideas best fit our organisational capabilities?
5. Customer impact: Which ideas meet our customers’ needs? Which ideas will have a positive impact at our most critical touch points?

Of course not every idea will excel in all these areas. The point is to get the right balance of impact within your innovation portfolio over time. The purpose of these evaluation areas is not to constrict you when coming up with dazzling ideas, but to give you a solid framework to decide which of your ideas brings your business the most reward and will still be dazzling when faced with the hard commercial reality of the marketplace.