Financial Rewards Make People Suggest Fewer but Better Ideas

FEB15_17_500px_57359702Excellent new research from the Harvard Business Review.

“Employees have proven to be a valuable source for innovative ideas. Which is why more companies are testing crowdsourcing initiatives and other ways to encourage people to innovate. Offering financial incentives has, for a long time, been one way to do this. But the research on whether rewards actually yield more innovation is mixed. On one hand, rewards can motivate employees to speak up; on the other, they bring in a flood of ideas that aren’t really actionable. In the pages of HBR, we’ve said to focus on culture instead of cash and to avoid offering big rewards for innovation, because luring employees with flashy prizes can kill intrinsic motivation.”

Full article here,