Innovation Process Benefits: The Journey as Reward
Organizations can considerably amplify the resources available to their innovation projects — by helping volunteer innovators benefit from participating in the process.
When business executives and economists think about whether developing an innovation will be worthwhile, they tend to focus on the economic value of the outcome of the innovation process. “Will we earn enough profit from using or selling X innovation to justify the money and time required to develop it?” is, in effect, the question they ask.
However, that standard cost-benefit assessment is seriously incomplete when applied to individual innovators. These individuals can gain significant benefits from participation in a development process as well as — or even instead of — benefits from using or selling the innovation created.1 When innovation project sponsors can offer volunteer innovators such benefits, the net cost of those innovation projects can be much lower.
To understand this idea, consider the fact that innovation centrally involves problem solving. In other situations, problem solving is known to be valued by participants for the process itself. That is, people often engage in problem solving for the value of participating in the process — independent of any value derived from the solution found. Crossword puzzles provide a good example. Crossword aficionados can spend hours working hard to solve a crossword puzzle. Their reward is entirely in the fun of solving, not in the solution found. (After all, the solution is already known to the puzzle designer.) Indeed, if you were to offer avid crossword puzzle fans the puzzle solution to save them the effort of doing the puzzle for themselves, your offer would certainly be declined — and you might well be reproached and told not to spoil the fun.
We define “innovation process benefits” as all those benefits that innovators will get if they directly participate in the innovation development process — and will not get if somebody just hands them the solution to an innovation challenge. Important examples of innovation process benefits include enjoyment and learning obtained from participation in the project, as well as reputational gains obtained from being known as having made high-quality contributions. Innovation process benefits are distinct from benefits associated with using or selling the innovation created. They are only available to participants in the development process.
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4. J. De Jong, F. Gault, J. Kuusisto and E. von Hippel, “The Diffusion of Consumer-Developed Products in Finland: Evidence of Market Failure,” working paper, MIT Sloan School of Management, Cambridge, Massachusetts, 2013.
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8. Cooper et al., “Predicting Protein Structures.”
9. Cooper et al., “Predicting Protein Structures with a Multiplayer Online Game,” Fig. 54.
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12. Personal communication with Johann Füller, cofounder, Hyve Innovation Community, 2012.
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i. E. von Hippel, S. Ogawa and J.P.J. de Jong, “The Age of the Consumer-Innovator,” MIT Sloan Management Review 53, no. 1 (fall 2011): 27-35.
ii. De Jong et al., “The Diffusion of Consumer-Developed Products.”
iii. Hienerth et al., “User Community vs. Producer Innovation.”
iv. De Jong et al. “The Diffusion of Consumer-Developed Products.”
v. Hienerth et al., “User Community vs. Producer Innovation.”
vi. J. Schell, “The Art of Game Design: A Book of Lenses” (Burlington, Massachusetts: Morgan Kaufmann, 2008).