Do Innovation Prizes Work?

The Obama Administration loves innovation and challenge competitions.  In fact, it seems like they announce a new one every week.  It’s getting to the point where one can tire of non-stop prizes–whatever happened to regular programs that provide funding opportunities on a regular and predictable basis?   But, beyond these minor complaints, we should assess a more central question.  Do the prizes and competitions work?

Two new reports from the under-appreciated IBM Center for the Business Of Government take a look at these questions.  One report examines the impact of the website; the other looks more generally at how best to manage innovation prize competitions.   Both hit on similar themes and offer useful insights on how to make these competitions work well—in terms of both attracting good ideas, and in turning these good ideas into real innovations.

While these prize efforts are numerous, they are all still pretty new.  Thus, it’s hard to reach definite conclusions on impacts, but some good ideas for “what works” are already being shared.  Some examples:

  • Prize competitions need to focus on challenges that are sexy and challenging, but doable.  Putting a man on Pluto is out, but creating a reusable lunar lander (as in the Northrop Grumman Lunar Lander Challenge makes sense.
  • Lower barriers to entry.  Encourage lots of participants by keeping funding low, and by aggressively marketing the competition to non-usual suspects and in non-usual venues.
  • Think carefully about the prize itself.  It should be sufficiently attractive (think $$$) to attract interest and should also provide post-prize opportunities for commercial development along with non-monetary benefits as well.

Prize competitions look like they’re here to stay, so we might as well do it right.  These reports are a good first effort to develop some rules of the road for future prize and challenge designers.

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