Picking the Winners

by Christian Terwiesch and Karl T. Ulrich
published in the International Commerce Review, Vol 9, No 1, Summer 2010
Ref ICR091A

Kinghts joustingCreate and select exceptional opportunities for innovation through the use of tournaments.

Companies with a structured, professional approach to innovation are rare. Most do a great job managing processes like recruiting and sales training, but view innovation as a creative process that's shrouded in mystery. As a result, money is often thrown at mediocre projects with the hope that some luck will enter in and make them successful. Organizations seeking exceptional opportunities for innovation must instead employ a very process-driven approach to drive innovation.

Companies commonly speak of 'innovation pipelines' or 'funnels', but the reality is that many different ideas are fighting against each other for final approval: they are engaged in an 'innovation tournament'.

Treating innovation as an innovation tournament can change what you do, and what results you get. For example, in tournaments, the basic philosophy is 'the more the merrier' - so you might start out with more, not less, contenders. Often, contestants which generate strong opinions (against as well as for) do better than those raising few objections. Tournaments can be managed internally and externally. Using tournaments to generate more new ideas from outside and inside the company and then ruthlessly playing them off against each other can result in both better and faster innovation.

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About the authors

Christian Terwiesch is Andrew M. Heller Professor, Professor of Operations and Information Management at the Wharton School, University of Pennsylvania, US

Karl Ulrich is CIBC Professor, Professor of Operations and Information Management, and Vice Dean of Innovation at the Wharton School, University of Pennsylvania, US

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