Designing incentives in innovations processes. Gamification as an approach for creating an incentive system for the early stage of the innovation process


Master's Thesis, 2019

71 Pages, Grade: 1,7


Excerpt


List of contents

Abbreviations

Tables

Figures

1. Introduction
1.1 Motivation
1.2 Structure and method

2. The problem of incentives in innovation processes
2.1 Identification of innovation processes
2.1.1 Overview of innovation
2.1.2 Typical stages in innovation processes
2.2 Incentive systems in innovation processes
2.2.1 Preference deficits: Principal-agent theory
2.2.2 Basic requirements of incentive systems
2.3 Incentive relevant characteristics of innovation processes
2.3.1 Motivational structures
2.3.2 Creativity
2.3.3 Teamwork
2.3.4 Measuring performance

3. The gamified incentive system for the early stage of the innovation process
3.1 Play
3.2 Game mechanics
3.3 Game mechanics and play in incentive systems for innovation processes
3.3.1 Basic requirements
3.3.2 Innovation process requirements

4. Research design and methods
4.1 Data collection
4.1.1 Quasi-experiment – The gamified incentive system
4.1.2 Survey
4.1.3 Interview
4.2 Data analysis, findings and interpretation
4.3 Research limitations

5. Conclusion

Reference list

Appendix 1 – The gamified incentive system

Appendix 2 – Survey Questionnaire

Appendix 3 – Interview and transcript

Abbreviations

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Tables

Table 1: Relevant tasks for the incentive system (Stippel and Ebert)

Table 2: Correlation between factors of play and game mechanics

Figures

Figure 1: Problems resulting from unstructured innovation processes

Figure 2: Extended innovation process (Stippel)

Figure 3: Combination of funnel and phase model

Figure 4: Basic requirements according to Cascio

Figure 5: Influencing motivation through incentives (Heckhausen/Heckhausen)

Figure 6: Influence of play on motivation, creativity and teamwork (Witt)

Figure 7: Fulfilment of requirements by game mechanics

1. Introduction

1.1 Motivation

Innovation creates value, strengthens the market position and creates competitive ad-vantages.1 Therefore innovation is widely seen as a critical source for economic success for companies, which are subject to a constantly changing business environment.2 How­ever, at the same time, innovation is expensive. For example, in 2018 alone, Apple in­vested as much as 14,24 billion dollars on research and development. This represented around 46% of their total operating expenses and approximately 2,6% of their total rev-enues.3 But although innovation is considered as such an essential subject, managing and understanding innovations is still one of the most challenging tasks.4 However, these costs are making it vital for companies to ensure the efficient use of innovation resources. This efficiency is largely determined by the competence, creativity and motivation of the employees working in the area of in research and development (R&D).5 Thus, companies have to generate adequate motivation in employees to deliver their innovative ideas, obtain a patent and develop the patentable idea into profitable innovation.6 Especially since employees are the most critical resource in innovation pro­cesses as they are the source of creativity and new ideas. 7

Human resource (HR) management practices are considered as an essential instrument to fulfil this task. However, standard pay-for-performance schemes, which only reward short-term financial success, are not suitable for fulfilling this task in the innovation pro­cess, because innovation processes are likely to fail as they contain a high degree of uncertainty. In standard schemes, this failure would result in penalties by a lower com­pensation or a possible termination of the contract. This punishment has the potential to harm the innovative behaviour of employees. A company that wants to encourage inno­vation must design incentive systems that free employees to take risks, experiments and discover what practices and technologies are the most effective.8 These unique charac­teristics of innovation processes are the reason why analysing incentive systems in the context of innovation processes is of particular interest. Especially since incentive sys­tems are considered as essential for ensuring the efficiency of innovation processes, as employees adapt their behaviour to these systems.9

Incentive systems can contribute to the best possible exploitation of the employee’s abil-ities.10 A new way of setting those incentives and motivating employees is gamification. Gamification is defined as the application of game mechanics to a non-game setting, such as the business environment.11 Companies have discovered game-like incentives for motivating their employees, and now, this paper tries to create a gamified incentive system for motivating employees in the early stage of the innovation process.12 For this, the thesis poses the following research questions:

R1 (research question 1): Is the principle of gamification suitable for designing an in­centive system for the early stage of the innovation process?

To answer the first research question, it must be clarified what is meant by innovation processes and incentive systems. Besides the first question, sub-questions must be an­swered: a) How do incentive systems function in general, and which requirements must be fulfilled by the design of the incentive system? b) Which unique characteristics of innovation processes must be taken into account? c) How can the elements of an incen­tive system finally be designed, taking into account the unique features of the innovation process and using gamification? d) Does the gamified incentive system fulfil the require­ments derived from incentive systems and the innovation process? The designed incentive system will then be analysed with the help of an experiment to answer the second research question of this thesis:

R2: Can the principle of gamification be used as an incentive system and support moti­vation, teamwork and creativity in the early stage of the innovation process?

1.2 Structure and method

To answer these questions, the thesis is structured as follows. The second chapter lays the foundation for the research: the terms innovation and innovation processes are de­fined. Afterwards, the need for incentive systems is outlined with the help of the well-known principal-agent theory, and it is examined, how the principal-agent problem is affecting the innovation process. This theoretical knowledge is the basis for explaining which objectives are pursued by incentive systems in innovation processes and how they function in general.

Then a literature review will be used to outline, which general requirements can be de­rived from incentive systems, and the incentive relevant characteristics of innovation pro­cesses are outlined. The focus of this chapter lies on the four most important factors of the innovation process: motivation, creativity, teamwork and performance measurement. These factors represent major problem areas and are resulting in requirements for in­centive systems. By outlining general requirements from incentive systems and specific requirements from the innovation process, it is possible to investigate whether the prin­ciple of gamification is suitable for designing an incentive system. For this purpose, the two elements play and game mechanics are explained, and their influence on the most critical factors of the innovation process are examined. With the help of the literature review in chapter 2, it will be checked whether the general and specific requirements for incentive systems can be met by the elements play and game mechanics. Selected game mechanics are then tested in an experiment. This experiment represents an empirical analysis of their influence on the unique factors of the innovation process. For analysing this influence, the thesis uses a quasi-experiment in the fourth chapter. This experiment aims to answer the second research question by simulating one of the early stages of the innovation process. Participants will take part in a game in which points can be earned by generating ideas for solving a given problem in an inno­vation process. Afterwards, the influence of this game on motivation, creativity and team­work is examined with the help of a questionnaire and an interview. To be able to make comparisons to an already conducted study by Franke & Schöhnbohm, a similar experimental structure is used. The use of this similar approach also allows the analysis of the research gap: The original study did not consider the effect on teamwork, and this factor is therefore additionally depicted in this study.13 This is im­portant because innovation processes are often carried out in (project-) teams, and therefore, the influence of gamified incentive systems on this factor is also of great inter-est.14 In addition, literature does not provide a connection between gamification and its use as an incentive system. Therefore, the view on gamification from this point of view is also interesting, and the thesis aims to provide an overview of the relationship between incentive systems, gamification and its effect on the early stage of the innovation pro­cess.

2. The problem of incentives in innovation processes

2.1 Identification of innovation processes

2.1.1 Overview of innovation

Although the term innovation has established itself in business practice, a lot of different definitions can be found in the literature.15 Therefore, it is necessary to provide a clear definition of the term innovation. According to the Oslo Manual issued by the OECD, innovation is defined as a new or improved product or process (or combination of these) that differs significantly from previous products or processes and that has been made available to potential users (product) or brought into use by the innovator (process).16 In addition to this definition, Freeman provides the necessary differentiation between inven­tion and innovation: “(…) to be contrasted with an invention which is simply the bright idea for a new product, process or system”.17 Therefore, inventions are the preliminary stage of innovations and two essential conditions can be derived for the identification of an innovation: Novelty and implementation.18

However, there are not just different definitions for the term innovation. Innovations can also be divided into different types, depending on the focus on different characteristics.19 For example, it is possible to look at innovations from a micro- and macroeconomic per­spective. The macroeconomic perspective provides an aggregated view on innovations from different organisations and considers them as an important source of economic growth. However, in the further course of this thesis, only the microeconomic perspective will be relevant: the consideration of innovations on the company level.20 In this perspec­tive, it is possible to look at innovations in a result- and process-oriented way.21 The relevant perspective for this thesis is the process-oriented way. In this perspective, the innovation process is considered as a whole - all stages from the generation of ideas to the actual implementation of the innovation.22 Therefore, this perspective is relevant to the present work and more interesting than the result-oriented view. In the end, it is all about managing and measuring the innovation process and ensuring its efficiency. For this reason, the following chapter will provide a more detailed explanation of the innova­tion process itself.

2.1.2 Typical stages in innovation processes

Managing innovation activities varies among companies. Some manage their innovation activities through well-defined innovation projects or programmes while others primarily engage innovation activities ad-hoc.23 However, steering innovation activities ad-hoc can lead to adverse effects. And according to McGrath, Anthony and Shapiro, four problems are symptomatic for such unstructured development processes:

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Figure 1: Problems resulting from unstructured innovation processes24

For avoiding these problems, it is necessary to provide a framework which can be applied consistently on all projects.25 Thus, it is useful to look at innovations from the already mentioned process-oriented perspective. In this perspective, the innovation process can be structured by dividing it into different, iterative stages.26 The advantage of this method is that, even though each innovation process is characterised by certain singularities, they still can be divided into these different stages. Another advantage of structuring the innovation process into different stages is transparency. The division into different stages brings order into an otherwise ad-hoc coordinated process. And this order is also im­portant for incentive systems since each stage contains different activities and tasks, and therefore, different incentives must be applied.27

There are various ways of describing the different stages of innovation processes. How­ever, what most of these models have in common is that the innovation process com­prises all stages from the generation of ideas to the implementation of the innovation in practice.28 A modern example of structuring the innovation process into iterative stages was created by Stippel (see figure 2):

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Figure 2: Extended innovation process (Stippel)29

Stippel structured the innovation process into seven stages. According to Stippel, each stage is characterised by specific uncertainties and risks. Therefore, specific tasks and problems can be assigned to the stage (see table 1). These stages require the usage of different tools, measurements and controlling approaches, which must be considered in the design of an incentive system.30

Stippel’s model implies a sequential approach, but the innovation process is character­ized by multiple feedbacks, setbacks, overlapping activities and learning activities which have to be considered.31 Thus, stage models are only a heuristic representation of inno­vation processes.32 In addition to the absence of those feedbacks, setbacks and over­lapping activities, the present model does not contain a trigger for the innovation process - the problem to be solved by the innovation.

Therefore, extensions of Stippel's model should be considered, in which process triggers and feedbacks are also considered. Ebert provides such a comprehensive description of the innovation process. He combines a simple phase model invented by Thom with a funnel representation and adds the missing elements to Stippels model. This allows the main phases of the innovation process to be presented in a simple form and to be ana­lysed simply but accurately. In addition, feedback effects and triggers are considered now (see figure 3):

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Figure 3: Combination of funnel and phase model33

The innovation process according to Ebert is triggered by a problem which can be brought to the company by internal and external sources, e.g. customer needs (external) or developments within the company itself (internal). If a trigger occurs an analysis of the problem is necessary before the actual innovation process begins. However, it is not possible to depict these complex processes in a model, and they are therefore summa­rized in the field "trigger". In literature, this is often referred to as the fuzzy end. The fuzzy end already gives an idea of the complexity of managing innovation processes in prac­tice. However, regardless of this complexity, models are still useful for managing the innovation process because they allow the structured analysis of this process. Like in the model of Stippel tasks and characteristics can be added to the specific stage. This division into different tasks reveals another complexity in innovation processes: Some sub-processes have conflicting requirements and premises. For example: In the idea generation phase, the focus is still on encouraging creativity with as much freedom as possible while in the subsequent decision phase, rational and selective processes are necessary. In the next phase, the realisation of ideas, a mixture of both approaches is necessary.34

This thesis will focus on the first two stages of the innovation process according to Ebert, since the incentive system is based on gamification and the designed experiment is about generating ideas and simple evaluation of those ideas and not about their realisa­tion. The reason for choosing these stages is that activities during the early stage are more unpredictable and unstructured, and therefore, require tools which provide the nec­essary freedom. Gamification can provide this freedom, and therefore, this principle will be used by the quasi-experiment in this thesis.35

Table 1: Relevant tasks for the incentive system (Stippel and Ebert)

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Therefore, in the further course of the thesis, the term early stage of the innovation pro­cess defines the generation of ideas and simple evaluation of them. This stage has a significant influence on the success rate of new products and services and is therefore of importance.36

This influence on success makes it vital for companies to support this stage. However, since the generation of ideas can not be influenced directly, incentive systems are often used for this task. Therefore, incentive systems are analysed in the following.37

2.2 Incentive systems in innovation processes

2.2.1 Preference deficits: Principal-agent theory

Assumed or actual performance deficits of employees are causing the need for incentive systems.38 The origin of these deficits can be found in the area of principal-agent theory, which is based on four assumptions:39

1. All acting individuals are limited rational, individual utility maximisers.
2. The exchange is desired by all parties involved.
3. There is a conflict of interest between the exchange partners.
4. Information asymmetries exist which hamper the exchange of information.

The conflict of interest assumed in 3 is where the problem of preference deficits arises. Assumption 4 implies that the agent can influence the exchange in his favour through an information advantage. This is caused by the nature of delegating tasks, as the agent has been selected by the principal for his specialized knowledge, and therefore, the prin­cipal can never completely evaluate the agent´s performance. This delegation to an agent with different objectives is problematic when the principal´s information about the agent is incomplete. However, the principal needs the exchange and must deal with the lack of information arising from the asymmetric information. In innovation processes, the principals are usually the owners of the company or the managers of the innovation teams. The agent has an information advantage and is an employee who is directly in­volved in the development of the innovation. Conflicting objectives and decentralised information are thus the two essential characteristics of why the creation of incentives becomes necessary. Therefore, assumptions 3 and 4 and the maximising of utility are particularly relevant for incentive systems. The information asymmetry can occur before and within the relationship between principal and agent. During the interaction, the infor­mation owned by the agent ("hidden information") or the agent's actions itself ("hidden action") can remain unobservable by the principal.40

In innovation processes, the problem of information asymmetry is also given since it is complicated for the principal to assess the current status of an innovation process or the value of the innovation. In addition to this characteristic, the uncertainty of results, com­plex process structures and the process design as teamwork make it very difficult for the principal to judge the amount of work performed by an individual. It becomes therefore apparent that "hidden information" and "hidden action" are characteristics of the innova­tion process. E.g. the principal is interested in achieving measurable, financial success with innovations while the agent himself may rather be interested in gaining scientific knowledge and reputation.41

Therefore, control or incentive systems may be used for increasing performance and for overcoming the occurring principal-agent problems.42 Academic literature typically anal­yses this problem by using the principal-agent model for creating incentives that prompt agents to act in the principal’s interest.43 Incentive systems are appropriate for fulfilling this task, where the performance of processes can only be influenced and measured indirectly.44 Herewith, the information asymmetry can be overcome by the control func­tion of the incentive system and the conflict of interests can be overcome by the harmo-nisation of the interests of principal and agent.45

2.2.2 Basic requirements of incentive systems

Objectives, types and functioning of incentive systems

Incentive systems place the focus of performance on specific objectives and place the reward on the achievement of these objectives.46 In this thesis, incentive systems are therefore defined as intentionally designed combinations of different incentives into a bundle of coordinated measures.47

By setting these incentives, behaviour patterns that correspond to the company's objec­tives are promoted, and behaviours that are contrary to the company's objectives are inhibited.48 The intentionally set incentives in this thesis therefore include all activities that are intended to generate effects concerning motivation and direction of action for individual employees or teams. In the further course of this thesis, the focus will be on the design of these targeted incentive mechanisms. Intentionally designed incentives can, however, support existing motivation extremely effectively and thus induce high per­formance and excellent results. But to generate this effect, some attention must be paid to the requirements, objectives and functioning of incentive systems.49 The objectives of incentive systems can be divided into substance and formal objectives. Substance objectives are defined as objectives that can be derived directly from the ad­dressed problems of incentive systems and are therefore of importance for this thesis. This means that they refer to the content aspects of the particular problem, e.g. the lack of motivation. Five substantial objectives of incentive systems can be distinguished based on their individual functions: motivation interest, coordination interest, acquisition interest, satisfaction interest and compensation interest.50

Motivational interest is of importance for this thesis since, according to Weber, motivation is "a goal-oriented drive for action that triggers the execution of a certain action."51 This motivation to achieve a specific objective is influenced by individual and situational fac­tors, including the anticipated outcome of actions and their consequences. Individual factors are motives or needs, while situational factors are incentives that can activate a motive. (see figure 5) Incentive systems use this psychological correlation by combining several situational factors for promoting the motivation of the employees or influencing their innovative behaviour. In innovation processes, incentive systems should therefore awake individual needs or motives and thus activate a targeted drive for action towards a specific objective which is compatible with the company’s objectives.52 This is done by the motivation and a steering function of the incentive systems.53 In order to be able to fulfil these functions, incentive systems usually consist of three components: assessment base, reward and reward function. The assessment base is the measure by which the height of the reward is determined. It represents the measure on which the company is evaluating its performance, i.e. the measure on which the em­ployees should focus their efforts influencing it. Thus, the assessment base determines the direction of action to which the employees are to be motivated.54 The rewards/incen­tives are the stimuli which ensure that an incentive system works. While the assessment base should be based on the objectives of the company, the reward must be based on the needs and motives of the employee. Only then the steering of the employee´s be­haviour is effective.55 For this, specific requirements have to be considered by the design of the incentive system. These general requirements for incentive systems will be out­lined in the following.

General requirements for incentive systems

Incentive systems work because they are based on two accepted psychological princi­ples: increased motivation improves performance and recognition is a significant factor in motivation.56 These principles can be considered by using basic requirements. Only if they are considered, it is possible to steer innovation processes efficiently. As Becker writes:” (…) before an incentive system is developed, decisions have to be made (…) which requirements and limitations should be met and which expectations can be linked to its implementation.” Therefore, it is essential to define which basic requirements must be met by an incentive system.57

For this, literature provides a range of different requirements. E.g. Cascio defines four requirements which must be fulfilled by an incentive system to be efficient. According to him, an incentive system must be:

Abbildung in dieser Leseprobe nicht enthalten

Figure 4: Basic requirements according to Cascio58

In addition to this basic requirements Grewe, Lindstädt and Troßmann defined an addi­tional set of requirements. These requirements should also be fulfilled by the design of the incentive system.

Fairness (basic requirement)

The basic requirement for incentive systems is fairness. The following requirements serve as a base to fulfil the basic requirement of fairness: controllability and incentive compatibility. These two requirements are then further supplemented by implementation requirements.59

Controllability & Compatibility

The first supporting requirement of fairness is controllability. The performance of the em­ployee must be the primary driver of the assessment base, and external factors such as coincidence should not influence the evaluation.60 In order to ensure this, the employee must have decision-making authority for actions that are influencing the assessment base.61

The second supporting requirement of fairness is compatibility. This requirement defines that the effect of the incentives must be positively linked to the company's objectives.62 However, there is a conflict of objectives between these two supporting requirements. The requirement of controllability is usually controlled by input measurement variables since they are easy to measure without external influences. While compatibility can ra­ther be measured by output measurement variables since they are closely related to the objectives of the company. But these output measures are often influenced by external factors. In order to overcome this dilemma, it is necessary to use a mixture of input and output measures.63

In addition to these basic requirements, three implementation requirements must be ful­filled according to Laux: efficiency, fraud and transparency.64

Transparency

For meeting the requirement of transparency, three aspects must be met: comparability, understandability and comprehensibility. This means that incentive systems must be comparable between different employees. The employees must be able to understand and comprehend it. Therefore, the relationship between the reward and the form of the assessment base should be agreed and understood by the employee for being able to assess the consequences of his actions. Only in this way a motivating effect can occur during the process. This requirement is primarily a communication task but is also deter­mined by the design of the system.65

Efficiency

The efficiency requirement mainly describes the pursuit of a favourable relationship be­tween input and output.66 Firstly this requirement aims at a rational and economical ap­proach to the design of the system. It must be checked whether higher rewards or a better design of the control component are also justified by higher performance of the employees.67

Fraud

This requirement means that it must not be possible for employees to fraud the incentive system. It must not be possible to receive a higher reward without contributing more commitment to the company's objectives. However, this requirement poses a consider­able challenge for the design of an incentive system in because of the unobservability of many actions in innovation processes.68

These five essential requirements and basic requirements must be considered in the design of the incentive system for the incentive system to be effective. If these sub-re­quirements are fulfilled the requirement of fairness is given.

2.3 Incentive relevant characteristics of innovation processes

Since the general requirements for incentive systems are defined by the previous chap­ter, the requirements from the unique characteristics of innovation processes must be derived in the following. Innovation processes are influenced by characteristics that dis­tinguish them from other processes within a company. These will now be outlined, and requirements for incentive systems will be derived for designing an effective incentive system in an innovation process.

2.3.1 Motivational structures

In trying to influence the effort and work of employees in innovation processes, many management concerns are in the area of motivating them.69 Especially since the motiva­tion of the employees has a strong influence on the outcome of the innovation process. Therefore, understanding the employees motivation is vital for designing a gamified in­centive system.70

For this, it is essential to understand what motivation is and how it can be influenced. Motivation is a directed urge for action that arises from individual and situational factors. Individual factors are motives or needs, while situational factors are incentives that can activate a motive. This psychological correlation is exploited through incentives in inno­vation processes. Several situational factors are combined for promoting the employee’s motivation and influencing their innovative behaviour (see figure 5).71 Therefore, it is es­sential to outline the forms of motivation and their influence on the innovation process.

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Figure 5: Influencing motivation through incentives (Heckhausen/Heckhausen)72

Employees may work hard for one of two reasons – intrinsic or extrinsic motivation.73 Intrinsic motivation is defined as the degree to which a person performs a task because he or she is interested in the task itself.74 Extrinsic motivation arises when a person per­forms a task because he or she is interested in the promised reward or expected evalu-ation.75

Intrinsic motivation

Especially for employees who carry out creative and innovative activities, a high degree of intrinsic motivation is assumed because these activities require high creative perfor­mance, which requires a lot of energy, concentration and commitment. This commitment is more likely to be achieved through intrinsic motivation from the task itself.76 The reason for this is, that intrinsic motivation can lead to (task) involvement. This involvement arises when an object or task holds significant relevance for an individual. Thus, involvement depends on the motives of an individual and how a task can trigger these motives.77 Another reason why innovation activities profit from intrinsically motivated employees is the fact that extrinsically motivated employees tend to stick to the “tried-and-tested” route without questioning to receive a reward as fast as possible. In the innovation process, which is usually non-linear and challenging to plan an inner motivation, which perhaps stems directly from this uncertainty or complexity can therefore be regarded as advanta-geous.78 This positive effect of intrinsic motivation on the innovative performance is widely found in various studies, e.g. in a recent published research from Fischer, Maly-cha and Schafmann79 or Madjar, Oldham and Pratt, Gong and Zhang.80

Extrinsic motivation

Despite the assumed dominance of intrinsic motivation: There will hardly be an employee who works solely for the pleasure of his job.81 Additionally, the study from Fischer, Maly-cha and Schafmann shows that extrinsic motivators can also have a positive effect on innovative performance.82 This is underlined by a recent study by Jaaffar, Ganesan and Isa, which shows that intrinsic motivation has a more significant influence on the innova­tive work of employees than extrinsic motivation. However, at the same time, it is shown that the influence of extrinsic motivation cannot be neglected.83 Furthermore, innovation teams are very heterogeneous, which means that the needs and motives of the involved employees are likely to be very different. This makes the creation of the right incentive for achieving a higher intrinsic motivation very difficult.84 Therefore, it is important to add extrinsic incentives, too. In summary, this means that extrinsic incentives are a basic requirement of an incentive system. Intrinsic motivation only gains importance if a sufficient material basis has been reached.85

Therefore, both motivational forms and the following correlation between them must be considered by the incentive system: extremely high extrinsic incentives can harm intrin­sic motivation.86 This effect does not occur automatically when extrinsic incentives are provided. It rather depends on the design of the incentives and how the employees per­ceive them.87

Especially since incentives have a control and feedback component. The feedback com­ponent should be emphasized as studies show a positive effect of feedback on intrinsic motivation. It is assumed that intrinsic motivation increases when incentives give feed­back on the employee’s actions. But consideration must also be given to the control component of incentives. If control through incentives is perceived as too authoritarian the intrinsic motivation of the employees suffers since it is promoted by self-determina­tion and freedom.88 Therefore, the following requirements for the incentive system can be derived from the motivational structure in innovation processes:

Requirements from motivational structures

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By considering these requirements, it can be ensured that the gamified incentive system develops its full potential in motivating employees to act in the way the company wants.89

2.3.2 Creativity

Apart from the question of how employees can be motivated, it is vital to determine how the quality of ideas can be enhanced by supporting creativity. Since companies increas­ingly depend on creative ideas and innovative impulses, work is becoming more and more dynamic and knowledge-based. Therefore, knowledge employees’ creativity is crit­ical for the innovation process.90 The OECD also shares this opinion: “People are the most important resource for innovation as they are the source of creativity and new ideas.”91 Creativity is a mental effort that leads to an invention and is therefore the be­ginning of every innovation process. In the context of innovation processes, creativity is therefore defined as an idea for solving a specific problem.92

This creativity is not only needed at the beginning of the innovation process but accom­panies the entire innovation process.93 It is an individual characteristic of a person which, while strongly dependent on personal skills such as knowledge or divergent thinking, also depends on motivation and interaction with the environment.94 Characteristics of creative employees often include openness, an attraction to complexity, high levels of energy, independence, autonomy, self-confidence and a strong belief that one is crea­tive. Cognitive abilities of creative people include high intelligence and ability to analyse situations and data effectively.95

On the one hand, incentive systems can enhance creativity by motivating creative think­ing and interaction with the environment. On the other hand, creativity is strongly based on intrinsic motivation and freedom of action.96 However, creativity in individuals is not so easily produced. Creativity requires freedom to break the rules without fear of reprisals or rejection.97 Thus incentive systems can also restrict creativity by linking the reward to too narrowly defined actions. Such inappropriate incentive systems are standard corpo­rate reward and control systems as they reward conformity instead of creativity. To en­sure the company encourages creativity, the company should measure performance with taking creativity and innovation tasks into account. To get employees to use their creative energy, the company’s culture must cultivate creative thinking through encouragement, commitment, recognition and rewards.98

Therefore, the following requirements for incentive systems can be derived. By consid­ering these requirements in the incentive system creativity can be supported especially since games are capable of increasing the creative behaviour of individuals:99

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[...]


1 Cf. Ebert (2006), p.1-2.

2 Cf. Grabner/Posch/Wabnegg (2018), p.163.

3 Cf. Apple (2019).

4 Cf. Katz (2004), p.3.

5 Cf. Specht/Amelingmeyer/Beckmann (2002), p.298.

6 Cf. Platz/Rozell (2019), p.1.

7 Cf. OECD (2018), p.115-117.

8 Cf. Manso (2017), p.18-19.

9 Cf. Becker (1987a) p.29.

10 Cf. Specht/Amelingmeyer/Beckmann (2002), p.298.

11 Cf. Procopie et. al (2015), p.1142.

12 Cf. Robson et. al (2015), p.411.

13 See Franke/Schönbohm (2016).

14 Cf. Pervaiz/Shepherd (2010), p.303-304.

15 Cf. Gault (2018), p.617.

16 Cf. OECD (2018), p.20.

17 Freeman (1992), p.59.

18 Cf. Alegre/Lapiedra/Chica (2006), p.334.

19 Cf. Pervaiz/Shepherd (2010), p.7.

20 Cf. Weber (2006), p.17-18.

21 Cf. OECD (2018), p.68.

22 Cf. Pervaiz/Shepherd (2010), p.177.

23 Cf. OECD (2018), p.68.

24 Cf. McGrath/Anthony/Shapiro (1992), p.101-104.

25 Cf. Pervaiz/Shepherd (2010), p.178.

26 Cf. Bergmann (2005), p.29-30.

27 Cf. Werner (2002), p.22.

28 Cf. Stippel (1999), p.21.

29 Cf. Stippel (1999), p.23.

30 Cf. Werner (2002), p.22.

31 Cf. Banu (2017), p.907.

32 Cf. Corsten/Schneider (2016), p.22.

33 Ebert (2006), p.37.

34 Cf. Ebert (2006), p.36-38.

35 Cf. Cooper (2002), p.145-147.

36 Cf. Patricio/Moreira/Zurlo (2018), p.499-500.

37 Cf. Troßmann (2018), p.229.

38 Cf. Troßmann (2018), p.226-228.

39 Cf. Eisenhardt (1989), p.58-60.

40 Cf. Laffont/Martimort (2002), p.2-3.

41 Cf. Leptien (1996), p.22.

42 Cf. Troßmann (2018), p.229.

43 Cf. Manso (2017), p.19-20.

44 Cf. Troßmann (2018), p.229.

45 Cf. Weber (2006), p.39.

46 Cf. Kressler (2003), p.157.

47 Cf. Ebert (2006), p.48.

48 Cf. Krieg (2013), p.11.

49 Cf. Kressler (2003), p.133.

50 Cf. Krieg (2013), p.11-15.

51 Weber (2006), p.11.

52 Cf. Heckhausen/Heckhausen (2008), p.3-4.

53 Cf. Troßmann (2018), p.232-233.

54 Cf. Cascio (2013), p.422-423.

55 Cf. Troßmann (2018), p.232-233.

56 Cf. Cascio (2013), p.441.

57 Cf. Becker (1987b), p.60.

58 Cf. Cascio (2013), p.441-442.

59 Cf. Troßmann (2018), p.242.

60 Cf. Lindstädt (2002), p.18.

61 Cf. Troßmann (2018), p.242-243.

62 Cf. Lindstädt (2002), p.18.

63 Cf. Troßmann (2018), p.244-245.

64 Cf. Laux (2006), p.24-25.

65 Cf. Grewe (2012), p.14-15.

66 Cf. Troßmann (2018), p.249.

67 Cf. Leptien (1996), p.45.

68 Cf. Troßmann (2018), p.249.

69 Cf. Katz (2005), p.19.

70 Cf. Zichermann/Cunningham (2011), p.15.

71 Cf. Heckhausen/Heckhausen (2008), p.3-4.

72 Cf. Heckhausen/Heckhausen (2008), p.3-4.

73 Cf. Eriksson/Kadefors (2015), p.147.

74 Cf. Wang (2013), p.495.

75 Cf. Amabile (1993), p.188.

76 Cf. da Costa et al. (2015), p.171.

77 Cf. Witt (2012), p.28-29.

78 Cf. Frey/Osterloh (2002), p.21.

79 Cf. Fischer/Malycha/Schafmann (2019), p.10-11.

80 Cf. e.g. Madjar/Oldham/Pratt (2002), Gong/Zhang (2017).

81 Cf. Frey/Osterloh (2002), p.21.

82 Cf. Fischer/Malycha/Schafmann (2019), p.13.

83 Cf. Jaaffar/Ganesan/Isa (2018), p.792-793.

84 Cf. Weber (2006), p.14.

85 Cf. Staudt et al. (1990), p.1195-1196.

86 Cf. Amabile (1993), p.188.

87 Cf. Frey/Osterloh (2002), p.14.

88 Cf. Weber (2006), p.55-58.

89 Cf. Zichermann/Cunningham (2011), p.15.

90 Cf. Fischer/Malycha/Schafmann (2019), p.2.

91 OECD (2018), p.115.

92 Cf. Weber (2006), p.20-21.

93 Cf. Pervaiz/Shepherd (2010), p.48-49.

94 Cf. Fischer/Malycha/Schafmann (2019), p.2.

95 Cf. Platz/Rozell (2019), p.5.

96 Cf. Forbes/Domm (2004), p.4.

97 Cf. Nemeth (2004), p.83.

98 Cf. Platz/Rozell (2019), p.4-6.

99 Cf. Dogson/Gamm/Salter (2005), p.165.

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Details

Title
Designing incentives in innovations processes. Gamification as an approach for creating an incentive system for the early stage of the innovation process
College
Berlin School of Economics and Law
Grade
1,7
Author
Year
2019
Pages
71
Catalog Number
V535508
ISBN (eBook)
9783346180926
Language
English
Keywords
designing, gamification
Quote paper
Lukas Weniger (Author), 2019, Designing incentives in innovations processes. Gamification as an approach for creating an incentive system for the early stage of the innovation process, Munich, GRIN Verlag, https://www.grin.com/document/535508

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Title: Designing incentives in innovations processes. Gamification as an approach for creating an incentive system for the early stage of the innovation process



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