What is your Innovation Budget?

I’ve recently subscribed to Report 103, a weekly e-mail newsletter from jpb.com, an innovation company.  I found this great idea in their October 12, 2004 edition:

 Give everyone in a medium to large company an innovation budget. Each person’s budget would be based on their position in the company. Regular staff might get 2000 Euro/year; middle managers 5000; senior managers 10,000; and so on). Innovation budgets are to be used exclusively for developing ideas.

If an idea results in an RoI (return on idea), the idea owner receives an increased innovation budget based on a percentage of the RoI. Thus, innovative people get an ever larger pool with which to innovate.

Moreover, staff can form teams with each person contributing a part of their innovation budget towards implementing an idea. If the result is a positive RoI, each contributor receives an innovation budget increase based on the percentage of their budgetary contribution.

Finally, people can buy and sell ideas with their innovation budgets. If you have a great idea which you do not or cannot implement, you can sell the idea to a colleague who is interested in implementing it. The colleague then transfers part of her innovation budget to you.

Alternatively, if you have a great idea, but insufficient budget to implement it, you can sell stakes in your idea to colleagues.

Over time, the company’s most innovative people will amass substantial innovation budgets. These people can then become idea investors, providing innovation-budget-equity based investments in employees’ ideas; particularly big ideas which an individual employee would not have the budget to implement.

The beauty of the system is that it allows people to grow based upon their innovative strengths. People who are strong on creativity and ideas but weak on implementation, can sell their ideas in order to amass an increasing innovation budget.

People who are stronger on implementation, on the other hand, can buy ideas or co-operate on ideas in order to amass increasing innovation budgets.

Only those people who want nothing to do with innovation will see their budgets stagnate. But such people are usually rather boring. So we need not worry about them, need we?

Still trying to figure out how this can work in a law firm environment.  Maybe my Innovation Assistant could help.

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