Smart incentives for social innovation  Some of NESTA’s lessons on challenge prizes
 
<ul><li>“ None of us is as smart as all of us” </li></ul>
 
Prospective Retrospective  Open Closed
 
<ul><li>“ A £1 million innovation prize for community-led responses to climate change .” </li></ul>
Source: Smart incentives for people-powered innovation. How to deliver the Big green Challenge prize approach.  NESTA The ...
...THE GREEN VALLEYS 10 finalists 4 winners
… HOUSEHOLD ENERGY SERVICES
<ul><li>At least  10-46% reduction on baseline  in the BGC year </li></ul><ul><li>At least  4860 t Co  2 yr* in future yea...
BGC changed behaviour – key to tackling complex social issues
<ul><li>The importance of asking good questions </li></ul>Lessons learned
<ul><li>Reward outcomes not activity </li></ul>Lessons learned
<ul><li>Financial incentives aren’t everything </li></ul>Lessons learned
<ul><li>What issues should we tackle through prizes? What are the best questions? </li></ul><ul><li>What’s the right scale...
The Big Green Challenge Mass Localism Social Challenge Prize Guide Make It Local Big Green Challenge evaluations Buying Po...
<£10k £10m £100m+ Simple, single-product or service Characteristics of different scale inducement prizes  Complex, paradig...
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Laura Bunt (NESTA) on key learning on challenge prizes

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  • The promise of prizes… Compared to other innovation drivers, such as grants and contracts, properly-designed prize competitions offer a level playing field, a transparent judging process and flexibility to enable maximum creativity. Perhaps most exciting is the ability of prize competitions to attract innovators from non-traditional sectors. Finding ‘black swans’ is often the key to uncovering disruptive technologies that have social and security impacts.
  • Explosion in social innovation challenge prizes… And demand from UK Govt to implement as part of innovation strategy Euclid Naples competitions challenged entrants to develop sustainable solutions to community issues in the Italian city Ansari X Prize: $10m to the first private-sector group able to fly a reusable spacecraft 100km (62 miles) into space twice within two weeks $10m Progressive Automotive X Prize, for green cars that are capable of achieving at least 100mpg, or its equivalent.
  • For me a prize needs to be the start of something, not the end of something - distinction today between ‘inducement prizes’ and ‘recognition prizes’ The Longitude Prize was set up by the British government in 1714 as a reward for reliable ways for mariners to determine longitude
  • Designed well, can achieve a lot. Some of you will know about this…
  • Inspired by open innovation challenges such as the X-Prize and InnoCentive – which (currently) mostly focus on technological innovations – NESTA designed and launched the Big Green Challenge in 2007. The Big Green Challenge was a £1 million open innovation challenge prize for communities to tackle a social challenge. We developed a hybrid model that encouraged widespread responses and engagement with the challenge and supported a number of projects to test and develop their approaches.
  • 1 Challenge prize: a clearly defined challenge is set and a prize is offered to the most successful solution(s). 2 Outcome-focused: this approach rewards performance – the prize is awarded for solutions that prove themselves successful against measurable criteria. 3 Staged process: taking respondents through a series of clearly defined stages, which start with a low barrier to entry and become increasingly more demanding. Participants receive non-financial and/or small-scale financial support at each stage. 4 Not prescriptive: how the problem is tackled is left entirely to competitors to decide. It requires the organiser to be genuinely open to not knowing what the most effective types of solutions will be. 5 Open: barriers to entry are low, with eligibility criteria kept to a minimum.
  • IMPACT
  • By designing a prize competition to address the raw need you’re trying to address, and marketing the competition without sector specific language, organisations can attract innovators they would have never reached, and thereby, solutions they would never have found. Peter Diamandis – “mega-X-prizes” – audacious goals A study co-authored by Karim Lakhani of Harvard Business School reviewed scores of problems solved on InnoCentive and found that people from outside the scientific or industry discipline in question were more likely to solve a challenge. A Challenge can’t be too broad. It can’t be too narrow. It has to be just right. And you want to fashion the Challenge so that as many Solvers as possible try to crack the problem (InnoCentive)
  • Need to have clear achievable goals Defines what challenges are appropriate (open data? Waste? Climate change? Ageing well?)
  • In BGC, challenge and advice as valuable as cash Incentivised collaboration and portfolio learning For complex and creative tasks, financial incentives has a negative impact on performance.” In particular, your top 1%* are not primarily motivated by money. That isn’t to say money isn’t important but the primary incentive is always some kind of unmet need or an interesting challenge that is intriguing in it’s own right.
  • As with any emerging practice, many questions remain…
  • Make It Local: Make it Local aims to show how local authorities can work with digital agencies to unlock their data and provide really useful web-based services for their citizens. Local authorities hold significant amounts of public data– such as transport, carbon emissions, population and crime data – which may help to power a range of useful, digital services. Four forward-thinking councils have now been chosen after a competitive tendering process. In conjunction with a digital media business they will each start to develop an innovative web-based service using the council&apos;s publicly-owned data. Our winners: London Borough of Barnet in partnership with mySociety The team will develop two projects to link local council data to two existing national websites.  Barnet Council will unlock all data on street-based problems, such as graffiti and broken paving slabs, by linking all of their information with the current FixMyStreet national website.  This will give local residents a complete picture of all issues raised in their area. They will also develop a local government version of TheyWorkForYou, a website which lets the community to keep track of the work being done by their local MP. London Borough of Sutton in partnership with web developer Adrian Short The team will create &apos;Sutton Open Library&apos;, an online service giving residents instant access to library information such as the availability and location of books and resources held in stock.       The project will also develop a new resource for community borrowing.  Users will be given an opportunity to register books they own and offer them as a community resource, lending titles to other residents in Sutton. Kirklees Council in partnership with Thumbprint Co-operative The team will build an online community resource called &apos;Who Owns My Neighbourhood&apos;, using land ownership data, where residents can add and discuss information about their area and keep up to date with solutions to local land problems such as fly-tipping. The site will also give locals a say in how green or redundant space can be used more effectively, making it easier for them to request space for projects such as community allotments. Birmingham City Council and Digital Birmingham in partnership with Mudlark The team aims to create a &apos;Birmingham Civic Dashboard&apos;, a social web tool that maps where requests for council services have been made. Residents and the council will be able to use the web tool to see the themes developing from these service requests and the broader issues they illustrate such as graffiti &apos;hotspots&apos;. The Neighbourhood Challenge What is it? The Neighbourhood Challenge is a new programme from NESTA, working with the Big Lottery Fund, to support community-led innovation. It aims to show how community organisations – when equipped with the right skills, practical tools and small, catalytic amounts of money – can galvanise people to work together to create innovative responses to local priorities, particularly in neighbourhoods with low levels of social capital. Community organisations across England are invited to apply for the 18-month programme. NESTA will select ten organisations and provide them with funding to trial an approach to community organising that reflects their own vision for what will work best in their area. We will provide the practical tools and high-quality training needed for participating organisations to help people in their communities create local campaigns, innovative community projects and new social enterprises that address their passions and priorities. We will also provide micro-finance to support the development of local projects and establish local challenge prizes to incentivise community-led innovation. The Neighbourhood Challenge will deliver tangible impact and powerful case studies in local areas. At the same time, it will be rigorously evaluated to inform the Government’s thinking about how to make the Big Society work for all communities in the UK. Why is it important? NESTA’s own experience in supporting community-led innovation, through programmes like the Big Green Challenge, shows the huge untapped potential that resides in all communities. Now more than ever we need to unlock that potential, bringing people together to collaborate, take control, make things happen and solve problems. It is an approach that we have called Mass Localism. We know that our experience is shared by many others who have pioneered different approaches to galvanising community-led action and innovation. This is particularly true in the fields of community organising and support for new social entrepreneurs. The challenge is how we take these approaches to scale rapidly across the country and particularly in those neighbourhoods with low levels of social capital, for example where low numbers of people are involved in community activity. Different communities have different needs, and we urgently need better evidence of what approaches to stimulating community-led innovation work best in which contexts. The Neighbourhood Challenge aims to put the idea of Mass Localism – empowering communities to design their own innovative solutions to social challenges – into practice. 2 Why should I get involved? We want to hear from established community organisations that share our ambition and who have a vision for how they could use community organisers, challenge prizes or other methods for stimulating community-led action in their area. You don’t have to have all of the answers, but you do need a willingness to innovate and experiment with different approaches. We welcome expressions of interest from organisations who are already working on these issues and those with an appetite to get involved for the first time. To be eligible to take part in the programme you must be based in England, be a legally constituted community or public organisation and have identified neighbourhoods in your locality that experience low levels of social capital, for example where low numbers of people are involved in community activity. These neighbourhoods will be the focus of your work in the programme. We also welcome expressions of interest from partnerships of organisations, provided the lead partner meets our eligibility criteria. If you are an individual or group of people with ideas for how to tackle issues in your neighbourhood, we suggest you check whether an organisation in your area has been selected to take part in the programme (this will be announced in early 2011). If so, then get in touch with them to see if you can become involved. What happens next? The first step is to register your interest online: www.nesta.org.uk/neighbourhood-challenge. The deadline for submitting your expressions of interest is 22 November at 12 noon. A panel convened by NESTA will consider the expressions of interest, and invite around 30 organisations to workshops in order to develop their ideas and shape the programme. We will then select ten community organisations to take part in the programme. Selection will be based on the organisations’ vision and capacity to make it happen, as well as the need to ensure that the programme includes a mix of different areas and approaches. From February 2011 to February 2012 the participating organisations will receive financial and in-kind support to run their programmes in the neighbourhoods they have selected. The precise level of support will depend on the approach taken, but as a guide we expect to provide each area with at least £150,000 worth of support.
  • Laura Bunt (NESTA) on key learning on challenge prizes

    1. 1. Smart incentives for social innovation Some of NESTA’s lessons on challenge prizes
    2. 3. <ul><li>“ None of us is as smart as all of us” </li></ul>
    3. 5. Prospective Retrospective Open Closed
    4. 7. <ul><li>“ A £1 million innovation prize for community-led responses to climate change .” </li></ul>
    5. 8. Source: Smart incentives for people-powered innovation. How to deliver the Big green Challenge prize approach. NESTA The staged process of the Big Green Challenge 1. A challenge prize 2. Outcome-focused 3. Staged process 4. Not prescriptive 5. Open Five Principles
    6. 9. ...THE GREEN VALLEYS 10 finalists 4 winners
    7. 10. … HOUSEHOLD ENERGY SERVICES
    8. 11. <ul><li>At least 10-46% reduction on baseline in the BGC year </li></ul><ul><li>At least 4860 t Co 2 yr* in future years </li></ul>*CO 2 reductions in the Big Green Challenge year were monitored by CRed on behalf of NESTA. This data provides a conservative estimate of reductions achieved by Finalists across the Big Green Challenge year. The emissions reductions achieved, now and in the future, may well be higher than the reductions reported here.
    9. 12. BGC changed behaviour – key to tackling complex social issues
    10. 13. <ul><li>The importance of asking good questions </li></ul>Lessons learned
    11. 14. <ul><li>Reward outcomes not activity </li></ul>Lessons learned
    12. 15. <ul><li>Financial incentives aren’t everything </li></ul>Lessons learned
    13. 16. <ul><li>What issues should we tackle through prizes? What are the best questions? </li></ul><ul><li>What’s the right scale for a challenge prize? How elastic is funding? </li></ul><ul><li>How can we measure outcomes more effectively? </li></ul><ul><li>Who participates in prizes? Can we access new problem solvers? </li></ul>What’s next?
    14. 17. The Big Green Challenge Mass Localism Social Challenge Prize Guide Make It Local Big Green Challenge evaluations Buying Power: SBRI health-check Neighbourhood Challenge 100% Open - Corporate open innovation challenges Practical Policy & Research
    15. 18. <£10k £10m £100m+ Simple, single-product or service Characteristics of different scale inducement prizes Complex, paradigm-shifting inventions Specific groups: eng students, “makers” Individuals Improve one aspect of a product US Air Force helicopter abseiling glove Teams, small businesses Larger communities or businesses Big business or well-financed ventures Heavy tech investment; infrastructure deployment The general public Global audiences; world leading firms Size of prize £100k £1m Omincompete Global Security Challenge NESTA Big Green Challenge Type of challenges Target groups Likely type of entrant Requirements for winning Real-life examples Branson Climate challenge, Saltire prize Gates Foundation malaria vaccine APC, Archon X-P 4
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