Innovation Incentives

24 Jun 2010 Sandeep Mehta

Slate Magazine in an article titled How to make America more innovative: give scientists more incentives to innovat: shows that just opportunity and skills are not enough to drive innovation.  Organizations need to align incentives with needed behavior to innovate successfully.

“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 national Innovation 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.”

The authors point out that HHMI with guaranteed support for five years tends to have more publication than NSF/NIH funded project.  I think that in many R&D organizations, guaranteed employment may not have exactly the same results  – HHMI only allows people to work there for a few years.  Employees have to find a permanent home someplace else at the end of their stay.  This would probably drive some behavior.  Also, amount of money being awarded may have some impact on results as well.

Unfortunately, no simple solutions / rules.  Only thing for certain is that R&D managers have to keep incentives in mind when trying to drive innovation.

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