There is a weird relationship between innovation and motivation. You can’t force creativity. Instead, you have to find ways to inspire creative people and get out of the way.
That was the topic of an article from Slate, called How to Make America More Innovative. Writer Ray Fisman reviewed a study of two different approaches for funding medical research:
To assess the importance of incentives in stimulating innovation, MIT economists Pierre Azoulay and Gustavo Manso, together with UC-San Diego professor Joshua Graff Zivin, analyzed the research output of life scientists chosen as “Medical Investigators” during 1993-95 by the Howard Hughes Medical Institute, which provides long-term and flexible funding to award recipients. They measure HHMI investigators’ output against that of researchers who receive Pew, Searle, Beckman, Packard, and Rita Allen Scholarships—also prestigious early-career awards whose winners are probably of a caliber comparable to HHMI recipients. However, because these programs provide less funding than HHMI, award winners rely for the most part on National Institutes of Health support to pay for their research.
The [Howard Hughes Medical Institute] and [National Institutes of Health] funding incentives are a study in contrasts. HHMI gives five years’ worth of research funding, renewable at least once as long as reviewers see effort, not necessarily results. NIH funding typically expires after a few years. HHMI picks “people not projects” while the NIH does the opposite, tethering funding to particular experiments or analyses.
Despite comparable pre-award performance, the two groups diverge in the years that follow. HHMI winners are almost twice as likely to produce studies that are highly cited by other researchers. They are also more likely to produce research that introduces new words and phrases into their fields of research, as measured by the list of “keywords” they attach to their studies to describe their work. The downside is that they also produce more stinkers—studies that never get cited by anyone. But, again, that’s part of the exploration process.
Incentives matter for innovation, and it’s a critical lesson for the government bureaucrats set to disburse hundreds of billions of dollars through Obama’s nationalInnovation Strategy, which is supposed to return America to innovative pre-eminence. The way we spend those dollars will be at least as important as how much we spend, and if we want the next generation of ideas to be Made in America, Obama’s team had better get its incentives right.
Put simply, there are broadly two approaches to getting innovation out of creative people. Either use the NIH model of measuring closely and keeping researchers on a short leash, or try the HHMI system of choosing smart people and sending them off to work with minimal supervision.
Not surprisingly, the latter technique is more effective. Giving people plenty of room simply produces more results. Admittedly, some of those ideas might be terrible. But with lots of options, you are more likely to have better success overall.
You can use the Howard Hughes Medical Institute model at your company by picking people, not projects. You can imbue them with responsibility and authority to be innovative. Encourage them to come up with lots of ideas, even if some might end up being worthless. Trust leads to empowerment, and empowerment to productivity and satisfaction. Show your employees that you believe in their power to innovate without excessive oversight.
To learn more about innovation, especially with regard to workflow and productivity, don’t hesitate to contact our small business consultants today. We believe the best ideas for improving your organization are the ones your employees will generate when motivated, empowered, and heralded for their work.