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  How to get peak performance out of an innovation tournament 

Camacho, Nuno; Nam, Hyoryung; Kannan, P. K.; Stremersch, Stefan
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In pursuit of winning ideas to bolster innovation efforts, companies are increasingly turning to innovation tournaments. From PepsiCo's "Do Us a Flavor" tournament to Dell's IdeaStorm website, more and more businesses are inviting fresh ideas from the public through purpose-built online platforms. In the tournament format, at least one submission ends up being selected as the winner after an allotted time period.

But so far, innovation tournaments are producing mixed results. On the one hand, firms can benefit from fresh approaches by customers and other outside idea contributors, aka "ideators," who may have specialist knowledge or ways of thinking that the firm currently lacks. The sheer volume of ideas competing for the tournament's crown raises the likelihood of high quality ideas making the cut. But it can also lead to firms being overwhelmed by the response and, as a result, struggling to sift through the myriad proposals in order to pick out the most promising ones. And after all that effort, sometimes the "winner" falls short of expectations.

Looking at the wrong variables
A study by Nuno Camacho, Hyoryung Nam, P.K. Kannan and IESE's Stefan Stremersch suggests that companies may be looking at the wrong variables when it comes to determining the success of an innovation tournament. Instead of obsessing about the volume of ideas submitted, firms should focus on stimulating ideators' "participation intensity" -- that is, how often they interact with the tournament's platform over the course of a contest. Although engagement data can be readily obtained from most platforms, firms tend to limit their reporting to the number of ideas and number of ideators. That is to say, they simply don't pay as much attention to when moderator feedback encourages idea revisions.

This finding comes from the authors' large-scale survey of innovation executives at 1,519 firms. The overwhelming message from the survey's respondents was that participation intensity is the key determinant and indicator of idea quality in innovation tournaments.

In this study, the authors also explored ways of improving participation intensity. To that end, they set up a commercial innovation-tournament platform at the Erasmus School of Economics in the Netherlands and invited students' suggestions on ways to improve the school by 2030. Over several rounds, the authors tweaked the type of moderator feedback given to each idea so as to gauge the impact of positive versus negative feedback as well as the timing of feedback on ideators' interactions.

You must be cruel to be kind
What they discovered flew in the face of some conventional wisdom. Negative feedback, with constructive criticism, was much more effective in sustaining participation intensity than positive feedback was. Meanwhile, the oft-employed "sandwich approach" -- i.e., negative feedback made more palatable by surrounding it with positive praise -- had comparatively little impact. In one experiment, almost four times as many participants who had received negative feedback from a moderator updated their ideas, as compared with participants who had received positive feedback.

The timing of the criticism was also important. Early negative feedback increased participation intensity whereas late negative feedback didn't. In one experiment participants who received negative feedback during the early stages of the tournament were 20 percent more likely to update their ideas than those who received negative feedback in the closing stages.

These findings have important ramifications for companies looking to hold innovation tournaments. Rather than focusing almost exclusively on the volume of participants and responses, tournament organizers should track and incentivize participation intensity, encouraging ideators to remain actively engaged in the tournament.

Firms hosting innovation tournaments should also ask third-party platform providers to regularly report participation intensity (e.g., at the end of each day) as a matter of course, just as they do for the volume of ideas and participants. Most commercial platforms could do this easily. One way of encouraging engagement is to establish payment schedules for third-party platform providers that factor in the level of participation intensity achieved.

To encourage more interaction in a tournament, organizers should have moderators challenge ideators' submissions early on and explain what additional work they could do to improve their ideas. And yet, merely pointing out that a participant needs to make more of an effort to achieve her goals is often enough to maintain her engagement in the tournament. But remember, timing is crucial: since the impact of constructive criticism on participation intensity appears to fade over time, moderators should concentrate their feedback on the early rather than later stages of an innovation tournament.
This article is based on:  Tournaments to Crowdsource Innovation: The Role of Moderator Feedback and Participation Intensity
Publisher:  Sage Publications
Year:  2019
Language:  English