Nothing for money: A behavioral perspective on innovation and motivation

Companies increasingly look to knowledge workers to advance new strategies, products, services, and processes, but making it happen is tricky: Dangling financial rewards can actually prove counterproductive. Behavioral research points to ways to effectively kindle employees’ motivation to innovate.

In this article, we discuss what drives innovation. First, we explain why intrinsically motivated behaviors, such as innovation, are difficult to direct with financial incentives alone. Then in an effort to answer what does effectively kindle an individual’s intrinsic motivation to innovate, we explore the following three dimensions: the power of social recognition in innovation tournaments, nonmonetary reward systems that positively influence innovation, and organizational citizenship behavior.

Kindling competitive spirit

Every organization encounters very specific problems they need to address. Issues such as fixing inefficient processes, meeting unmet market demands, or creating technical solutions hover over organizations without a team that’s responsible for developing solutions. Instead, if no one is motivated to provide an innovative solution, a problem may linger in the background, never receiving the full attention it deserves. Or worse, no single individual or team feels adequately equipped to offer a feasible solution.

For cases such as these, an innovation tournament merits consideration. Innovation tournaments introduce a problem to either an internal or external audience with the objective of crowdsourcing the best solution from the masses in exchange for a monetary or nonmonetary prize for the winning idea. On the surface, it would appear that the motivating reward system ties directly back to a cash prize. Even though that would seem to run counterintuitive to discussions on what motivates individuals to innovate, research suggests that additional, intrinsic rewards are also present for participants.

Citizenship and your organization

Innovation tournaments and public recognition are great motivators for isolated problems. But organizations are constantly juggling a series of unsolved, unknown issues, and their only hope is the grassroots innovators they employ. Often, businesses need their employees to seek out innovative opportunities while completing their routine responsibilities. These individuals should be equipped with the greatest insights as to where there is potential to innovate. Essentially, organizations look to develop vigilant innovators. To develop individuals who want to innovate, business leaders need to cultivate organizational citizenship behavior (OCB). OCB instills the desire in employees to go beyond prescribed duties on behalf of an organization in order to achieve new levels of efficiency and innovation. When OCB exists, employees want to see and contribute to a company’s success.

Depriving and driving innovative behavior

Encouraging the type of creative thinking that leads to innovation is no easy task for an organization. These are intrinsically motivated behaviors, and traditional economic incentives do not always work. Thankfully, there are impactful alternatives, which start with individuals developing a shared sense of community. When you have a specific problem that requires an innovative mind, tournaments are a great tool to spur innovative thinking. More generally, if you are looking to instill a 24/7 type of innovative mindset in your employees, it’s important to build a climate that promotes organizational citizenship. And when the time comes to reward innovations, make sure that these creative efforts are widely recognized and celebrated, even if they do fail from time to time.