Here is a quick article from The Guardian on how MIT Uses Selfish Profit Incentives To Win Military Challenge In A Single Day:
The Guardian: The Darpa Network Challenge, which took place on Saturday, offered a cash prize for the first group to successfully locate 10 large red weather balloons hidden at a string of secret locations across the US. Competitors were asked to use the internet and social networking sites to discover the whereabouts of the balloons, in what Darpa – the Pentagon’s Defense Advanced Research Projects Agency – said was an experiment to discover how the internet could help with rapid problem solving.
Effectively MIT used a pyramid scheme to drive behavior and get the desired result. This may not be a bad thing necessarily. In fact, Borderless Innovation talked about a Creative Bazar for innovation and the Indian conglomerate Tatas use karma points in somewhat similar fashion to identify and reward innovation.
May be this could be the answer to right Innovation Incentives?