The rise in “open innovation” contests has helped companies broaden their research and development while reducing their cost and risk of failure. Such contests easily reach large numbers of external problem solvers with a variety of backgrounds, potentially leading to faster, cheaper and better solutions.
The contests also have piqued researcher Pei-yu Chen’s interest in how to make them work more effectively. Chen, associate professor of information systems at the W. P. Carey School of Business, has co-authored three papers looking at how innovation seekers can better design contests, evaluate entries and encourage high-quality solutions. Her work also gives problem solvers clues for improving their chances of winning.
Among her findings:
- Above-average prize amounts attract more contestants for idea-based projects. But they have little or no effect on the number of contestants in expertise-based projects, where contestants’ time is scarce.
- For idea-based projects, shorter descriptions attract more contestants. The brevity seems to allow for more creativity, Chen says.
- For expertise-based projects, longer descriptions attract more contestants. The details give contestants a better sense of what the seeker wants.
- A contest of longer duration attracts more contestants, but the number of new entrants declines as the contest continues. Seekers should weigh the benefit of gaining entrants with the cost of maintaining the contest.
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