Article 5: Encouraging Innovation

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How PayPal Gets Employees Invested in Innovation


The article discusses how PayPal tackled the challenge of crowdsourcing innovation by implementing a unique approach inspired by the world of venture capital. Instead of relying solely on employees submitting ideas, PayPal introduced a blockchain-based token system called WoW. Employees earn WoW tokens by participating in innovation efforts, and they can use these tokens to invest in the ideas they believe have potential, regardless of the source.

The Global Innovation Tournament takes place annually over several months and consists of six rounds. Participants submit their ideas, and the top 100 ideas that attract the most investment move on to the next round. The process involves pitching ideas to senior management, and the winning idea is developed for implementation.

The article highlights the success of this VC-based design, as evidenced by employee surveys conducted after the 2019 and 2020 tournaments. The investment round increased the quality and quantity of submissions, and participants were motivated to join the tournament to improve the customer experience and contribute to the company's success.

While the article highlights the success of the approach, it also identifies potential concerns, such as excessive lobbying by teams trying to promote their projects. Limiting lobbying could help ensure that the best ideas, not just the most aggressively marketed ones, receive recognition and investment.



I find PayPal's approach to crowdsourcing innovation intriguing. The use of blockchain-based tokens (WoW) adds an innovative element to the process, providing employees with a tangible incentive to participate and invest in ideas. This not only promotes active engagement but also allows employees to have a more direct impact on the ideas they believe in.

I see the potential in adopting this approach in other organizations. It not only promotes a culture of innovation but also empowers employees at all levels to contribute and invest in the ideas they believe in. I believe this model could be adapted and tailored to suit different organizational contexts and industries, making it a valuable tool for fostering innovation and creativity in various settings. 


Reference:

Tsoukalas, G. (July 12, 2022). How PayPal gets employees invested in Innovation. Harvard Business Review. https://hbr.org/2022/07/how-paypal-gets-employees-invested-in-innovation



Comments

  1. ShiyaoAugust 4, 2023 at 7:15 PM

    Hi, Chuer. I really like how PayPal is encouraging innovation among its employees! Using blockchain-based tokens to invest in ideas (WoW) is such a unique and motivating approach. It gives employees a real stake in the innovation process and allows them to support the ideas they believe in. I think this kind of approach could be beneficial for many other companies too, as it fosters a culture of creativity and empowers employees to be more involved in shaping the future of the company. It's a win-win for both the employees and the organization!

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