How should we reward our employees for their ideas?

I have been working with a fairly large organisation recently, helping them plan their innovation process. The team from the client had done their homework and on the day I started, came armed with a number of interesting questions, including this one: “How should we reward employees for contributing ideas?”

This is a question that I am often asked so I thought it would be useful to share my suggestions.

I once read that it takes 3,000 ideas to yield a single commercial success. While I can’t recall who actually said this, I can, having seen inside many businesses, vouch for the magnitude of the proportion.

Given then that your business needs to generate a tonne of ideas, harnessing the brainpower of your employees makes complete sense. But getting them to actually do it – to take an interest in something over and above the day-to-day – well that can be tough. Hence rewards.

The tricky thing is this: the embryonic idea is often the easy part. As Thomas Edison famously said of invention, it is 1% inspiration, 99% perspiration. And that perspiration doesn’t come from just one person. In fact, the most commercially successful innovations come from ideas that have been worked and collaborated on by many people.

So for your reward system to be fair it needs to be one that encourages your people to stretch themselves beyond their normal work but recognises that the “stretch” may not just be about idea generation. Those who work up the idea and bring it to life need to be rewarded too.

As to the actual type of reward, I would avoid anything that is purely monetary.

Creativity seems to be stimulated best by intrinsic rewards – the fun of the process itself and its appeal to an individual’s personal growth, enjoyment and sense of satisfaction.

That said, creativity can certainly be bolstered by extrinsic rewards, but rather than a cash bonus, try these:

• Recognition: make a fuss, publicly, of your innovators.
• Celebration: hold a party for contributors.
• Time: allow individuals time off from their “day job” so that they can participate in the project of bringing the idea to life.
• Status: give individuals the opportunity to lead innovation projects.
• Education: pay for attendance at personal growth courses and seminars.

If you are looking for some quick results – to fill your idea pipeline up and get innovation going with a bang – two fabulously simple reward schemes are these:

• Freebies: a small gift for every idea submitted. Maybe a chocolate bar or movie ticket if you can stretch to that. You will be amazed how persuasive even the smallest freebie is.
• Raffle: everyone who submits an idea is entered into a raffle and a few winners are drawn randomly at the end of the period. The prize doesn’t have to be huge; it’s about the fun of winning.

The ultimate reward for an employee is of course to see the idea become a commercial success. Just as it is for you.

Julia Bickerstaff’s expertise is in helping businesses grow profitably. She runs two businesses: Butterfly Coaching, a small advisory firm with a unique approach to assisting SMEs with profitable growth; and The Business Bakery, which helps kitchen table tycoons build their best businesses. Julia is the author of “How to Bake a Business”  and was previously a partner at Deloitte. She is a chartered accountant and has a degree in economics from The London School of Economics (London University).

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