Big Idea: Leading Sustainable Organizations

A Little Competition Brings Out Astonishing Innovation

Contests can be big motivators for getting people to bring all their creativity to the table.

Leslie Brokaw Reading Time: 3 min 

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Leading Sustainable Organizations

Corporate adoption of sustainable business practices is essential to a strong market environment and an enduring society. What does it mean to become a sustainable business and what steps must leaders take to integrate sustainability into their organization?
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Oil Cleanup
Companies competed in a contest to win over a million dollars for the best oil skimming technology. Shown here: Team CRUCIAL shows off some its oil spill response technology.

Image courtesy of Flickr user XPRIZE Foundation.

Traditional ways of finding new ideas, such as investing in big R&D laboratories, are expensive. What’s more, they “often produce disappointing results,” write Alan MacCormack, Fiona Murray and Erika Wagner in the Fall 2013 issue of MIT Sloan Management Review.

What’s working for many companies now are contests — contests that present a company problem or challenge to the outside world, and that offer a wide variety of rewards for outsiders’ ideas. In fact, MacCormack, Murray and Wagner note, such contests often trigger major breakthrough ideas.

Take, for example, the Oil Cleanup X Challenge.

In their article “Spurring Innovation Through Competitions,” MacCormack, Murray and Wagner explain that the Oil Cleanup X Challenge is an example of how an organization can generate new solutions to a known problem.

The contest offered a $1.4 million prize in 2011 for the most effective product to recover oil from the surface of the sea. It was sponsored by Wendy Schmidt, a philanthropist whose foundation “works to advance the development of clean energy and support the wiser use of natural resources,” according to Schmidt’s bio at the contest’s website. “Once [spilled] oil hits the shore or is weathered on the sea surface, much damage has been done,” says the website. “We must have the technologies necessary to stop surface oil spills at the spill site.”

The winning team, drawn from more than 350 entries, was Elastec/American Marine, a company in Carmi, Illinois. The company is no Exxon or BP; it had revenues of $7.2 million in 2009 and $18.9 million in 2012, according to the company’s listing on the 2013 Inc. 500.

As it turned out, E/A Marine had been working in the oil recovery industry and selling products in this area for many years when the X Challenge contest was announced, MacCormack, Murray and Wagner write.

The authors explain that E/A Marine rallied its forces for the challenge: The company “had already identified several ideas for significantly improving oil-spill cleanup performance, but the ideas had remained on the drawing board until Schmidt announced the prize.

Topics

Leading Sustainable Organizations

Corporate adoption of sustainable business practices is essential to a strong market environment and an enduring society. What does it mean to become a sustainable business and what steps must leaders take to integrate sustainability into their organization?
More in this series

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Comments (2)
SHANKAR HN
I agree with J Bogie. Challenge is motivating while the feeling of competition may take away the mental states responsible for creativity and innovation. The word "Competition" implies fight while the word "Challenge" implies calling for the best in the challenged.
J Bogie
It is absolutely essential that we find ways to innovate more and the old paradigm of command and control is just not designed to generate creative ideas.   Clearly a challenge is a great way to stimulate creative thinking.  However I would like to suggest that there is a big difference between challenge and competition. The business world is so focused on competing, we seem to have tunnel vision and label many things as competition.   In my view, a challenge - an intellectual challenge or a physical challenge or anything that captures our imagination  - is not the same as competition. So it may be that the vehicle is named a "competition" but I would ask whether the participants are really competing "against" each other or whether they are challenging themselves to develop new ideas for a bigger purpose.  It might sound like "just words" - but how we talk about something, impacts how we think and how we act (as indeed how we act impacts how we think and how we talk). This could change the questions we ask and if we change the questions then we might find some new ideas.  The Western World is so stuck in industrial age thinking and yet there are brilliant minds everywhere trying to escape from its confines and limitations. Challenge is big - competition is very industrial age - and we need to find new challenges to stimulate new thinking.