Strategic incentive systems for open innovation

Abstract

Our paper presents a cross-sectional study of incentive systems for open innovation practices. Organisations face the challenge to design and implement strategic incentive systems which reward active contributions of individuals to open innovation practices. We refer to contributions from psychology and economics to develop a framework for organisational incentive systems. We have conducted semi-structured interviews with 10 experts in Germany and the Netherlands. The experts work in firms which are both international top players and open innovation pioneers in their respective industries. The results show that all organisations in the sample develop incentives for open innovation. The key strategic function of incentive systems is to open mind-sets of the workforce and to overcome mental barriers of the 'not invented here' syndrome. Immaterial and in particular task content incentives have been judged to have a more efficient long-term impact than material incentives. While experts have emphasised the importance of aligning incentives systems to open innovation strategies, in practice many incentive approaches still remain patchwork and lack a clear strategic focus. © by author(s); CC-BY.