You may not associate prize challenges as a technique commonly used by the government to accelerate innovation. However, since 2010, over 690 prizes from 98 federal agencies have offered more than $220 million in prize awards. The concept of running prize challenges in the Federal government is not new. Some prizes stem back several centuries, such as England’s Longitude Prize of 1714. This was a time when maritime trade and exploration were unable to accurately navigate their ships. It was a clock maker by the name of John Harrison, who developed a marine chronometer – the winning solution. This unlikely suspect earned upwards of $2 million in today’s currency and revolutionized subsequent marine travel technology. Even the most unlikely individuals create innovative solutions to the world’s most difficult problems.
A major benefit of running a prize challenge is being able to expand beyond your usual audience, and attract diverse talent from a variety of disciplines who come together and solve a problem. There, you can find the most unlikely suspects. Some of the other benefits to running prize challenges are:
- Running a prize challenge greatly accelerates the timeline of finding innovative solutions to the problem at hand. Rather than investing in one group’s ability to solve a problem, such as with a grant, prize challenges invite many different groups to solve the problem resulting in a wider range of innovative solutions.
- In addition, prize competitions allow agencies to only pay for winning solutions. Perhaps you award first, second, and third place winners, but you do not need to compensate other participants for their solutions. Prize challenges are cost effective in that agencies are presented with many solutions, and can pick and choose the ones that most closely meet their criteria.
- Prize challenges help stimulate the market and private sector investments. Depending on intellectual property provisions and the goal of the prize challenge, solutions can be further developed and implemented into the market after a prize challenge has ended. Additionally, winning solutions are not the only solutions that may be developed. Runner ups can also be developed further and create additional investment opportunities.
- Successful prize challenges thrive from cultivating a collaborative community dedicated to solving important issues. Crowdsourcing and open innovation allow for communities to come together regardless of competition. Teams are able to be formed through networking and community engagement opportunities.
There are many benefits to running a prize challenge, however prize challenges are complex and involve much time and effort. They are not a “one-size-fits-all” to every problem out there.
- Running a successful prize competition requires a significant amount of research, planning, & resources. Unless your agency has an established prize competition team already, internal resources are not typically well-versed in prize execution. Much time and effort is needed in the development of an experienced prize design team to ensure that your agency runs an effective and engaging prize challenge.
- Stemming from the previous point, effective communication practices between large groups of people are necessary throughout the entire prize challenge process. Fostering a collaborative environment between the prize team, solvers, judges, the general public, stakeholders, and industry leaders is no easy feat. Developing an efficient communications strategy and a considerable amount of organization is vital in making sure everyone is up to speed.
There are many pros and cons to consider when running prize challenges. Successful government prize challenges are most impactful when agencies dedicate the proper time, resources, and expertise to executing the prize. Success is also largely a result of an agency’s ability to effectively recruit and engage motivated solver communities. As the public sector increases to implement this creative approach to problem-solving, ground-breaking solutions may increase the progress and development of our country as a whole.