Myth #2 “People need money before they will share their ideas”

Motivation is a critical component of any innovation program, particularly in Enterprise Idea Management. There is a belief, misplaced in my experience, that financial rewards are the primary motivation for contributions, and the absence of any financial reward will lead to poor uptake of a program.

Once again, this is one of the Top 10 Myths of Idea Management that is busted. There are several reasons why financial reward is not vital for idea sharing, and in many cases actually damages any program. I’ll share a selection of these below.

  • Time lag between submission and reward – the best rewards make a direct connection between behavior and the reward. There is an often lengthy gap between submission of an idea and the assessment of benefit. People are therefore submitting anyway, way in advance of any financial benefit.
  • The level of reward is not high enough in terms of relative compensation to be a real driver – companies who award employees for patents in US usually give out just $1,000 awards, and only then the patents are granted (–which can be years away). And in any case, $1K is not much in comparison with any overall compensation package. To be meaningful, a reward must be high in relation to other forms of reward, and few companies have gone down the route of $100,000 prizes.
  • Top prizes kill programs – some firms have created programs that have $100,000 top prizes for submissions. These programs have proved highly devisive and are rarely implemented across multiple years. There are several reasons for this, the most important of them being the loss of morale for the well-placed non-winners (what about the person who came second?), and the practice that a second year of the program usually has a reduced award.
  • Most ideas are submitted because of a desire to help… – the attractiveness of the challenge (sparking intellectual curiority), the desire to see what other people are doing (social network), and a sense of frustration in the subject area, hence a desire to share a helpful solution.
  • Peer pressure – more and more, people are finding themselves drawn to enterprise idea management initiatives because they are aware that their colleagues are probably active, and non-participation may be damaging to one’s career and social status within the organization, and as a potential subject matter expert in the area.
  • Invitation to implement the idea – in some programs, the idea submitters are actively encouraged to submit ideas and to then be inivited to support the implementation of the idea. This can be very motivational for individuals, way beyond pure money.
  • Old fashioned suggestion programs needed bribery to work – If you are using an always-open suggestion box, people tend to forget that the program is available. The program owners effectively re-launch the program over and over again, and use financial incentives to encourage submissions. This can lead to damaging practices, such as people not submitting when there are no rewards, waiting for the incentives to be turned back on again.
  • Financial rewards mean that a program is likely to encourage cheating and negative behaviors – experience has shown that negative behaviors quickly emerge, even in the best run firms. Behaviors include idea theft (copying ideas), idea recycling (reusing old ideas), idea splitting (multiple submissions of single basic ideas – for programs that have rewards ‘per idea’), and idea pools (evaluators – who are often not eligible for rewards – agree with the submitter to rate an idea highly providing that they share in the benefit).
For more in-depth insight into rewards, I strongly recommend Punished by Rewards by Alfie Kohn

For more in-depth insight into rewards, I strongly recommend Punished by Rewards by Alfie Kohn

Overall, there are several motivations for making contributions. The key to long term Idea Management success is designing a program that:

 

  • culturally fits with the organization;
  • has the least amount of negative aspects;
  • can be administered with low cost and effort at an enterprise scale.

For more myth busting, see the Top 10 Myths of Idea Management.

No comments yet... Be the first to leave a reply!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: