Does Money Undercut Creativity in Product Development?


Creativity is often a crucial element in successful new product developments. A study published in the July 2011 issue of the Journal of Marketing found that of 20 firms investigated, 15 offered some type of incentive program for creativity. Seven firms provided creativity training with several of those also offering incentives. The authors noted that other studies have consistently found that extrinsic rewards (external to a person) offered alone actually undermine the creative process (by reducing internal motivation). However, two experiments found that product creativity was greatest when monetary rewards and creativity training were offered together.  The training reinforces, rather than undermines, intrinsic motivation.
– Burroughs, JE, et al. 2011. Facilitating and Rewarding Creativity During New Product Development. J Marketing.75:53-67.

— Claudia O’Donnell, Global Food Forums, Inc., a conference and seminar organizer