I've posted before (here, here) on the X-Prize and it's progeny.
The X Prize and it's ilk offer huge sums of money to solve a specific problem. From Netflix to Amazon and Sir Richard Branson - the idea of offering a prize - or an incentive - for innovations is catching on.
This article on Fast Company even goes as far as to call it a "new business model."
"We think prizes are a potential innovation in business models that can only be compared in importance to what the Internet did for telecommunications," says James Love, an economist who, as the director of the think tank Knowledge Ecology International, has been studying innovation prizes since 1999.
Wow! That's an endorsement.
Buried in the article are these pearls that need to be highlighted for those of you thinking of offering your own X Prize...
- Challenges must be specific - soft measures won't cut it. The rules must be very specific in order to get people to focus on the appropriate solution.
- Challenges can't be too big - as the article states - an X-Prize approach wouldn't have helped create the internet. When an innovation is too broad too many different areas of improvement and change are required in order for it to occur. The internet was a huge mashup of hardware, software and social change - none of which could have been influenced by a single team working toward a solution.
- Challenges work best in a diverse setting - Make sure your challenge can be accessed and worked on by a wide variety of people and disciplines. Don't limit your challenge to a single department or group. Allow the challenge teams to self-select. Open source the idea.
So think through what you would love to see in your business - can you translate that into an X-Prize type challenge?
...Or maybe that is your first contest?
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Marketing and Incentive Design Consultancy