"Innovation distinguishes between a leader and a follower." - Steve Jobs

Incentives for Innovation, Jim Naughton
This is a short entry about two papers that Jim Naughton recently presented: "Motivating Innovation" and "Is Pay for Performance Detrimental to Innovation".  An interesting quote about the first paper ("Motivating Innovation"):

...I focus on the tension between the exploration of new untested actions and the exploitation of well known actions. Exploration of new untested actions reveals information about potentially superior actions, but is also likely to waste time with inferior actions. Exploitation of well known actions ensures reasonable payoffs, but may prevent the discovery of superior actions.

An interesting quote about the second paper ("Is Pay for Performance Detrimental to Innovation"):

...Subjects under the pay-for-performance contract, on the other hand, tend to direct their effort towards fine-tuning the previous manager’s product mix, instead of searching for better locations. Subjects under the exploration contract obtain higher average profits than subjects under the fixed-wage and pay-for-performance contracts.

Innovation Leaders: How Senior Leaders Stimulate, Steer and Sustain Innovation, Roy Luebke
This is a book overview of the new book by Jean-Philippe Deschamps: Innovation Leaders: How Senior Executives Stimulate, Steer and Sustain Innovation. An interesting quote from Roy's overview:

Core characteristics of innovation leaders are explored. The author writes about front-end vs. back-end innovation skills, as well as bottom-up vs. top-down. There are very different talents required to identify user needs and opportunities at the front-end of discovery, and implementation and launch skills at the back-end of the process are very different disciplines. The author also recognizes that while bottom-up innovation is close to the end consumer, without top management, and specifically the CEO’s support the culture of the organization will reject innovation efforts.

The higher productivity and innovation potential of cooperative, Michel Bauwens
Michel Bauwens points out some sections of Kevin Carson's book on Organization Theory (specifically chapter 15 - there is a link to it in the entry).  An interesting quote of a quote:

Probably the best way of distinguishing between what we have termed major and minor innovations is that the latter generally cannot be the subject of a full-time professional occupation. Rather, they will arise as an externality… of an activity whose primary purpose is something else than to innovate–generally to produce or contribute to the production of some good or service. More concretely, …a repeated act of production will stimulate reflection on how that act could be facilitated, or done more efficiently….

Jeff Carlson Strives to Make Innovation a Core Competency at AIG American General, Kathy Burger
This is a pod cast (about 11 min long) in which Kathy Burger talks with Jeff Carlson (EVP and CIO of AIG) about AIG's new Center for Innovation.  There is also a full article about it: AIG American General's Carlson Makes Innovation a Core Competency.  The pod cast is more about innovation than the article.

Hartford Unveils Auto Insurance Survey Findings, DailyInsurer
The DailyInsurer discusses the results of a survey by Hartford Financial Services Group Inc. that was focused on auto insurance and some innovative features that might go well with auto insurance. An interesting link: http://innovations.thehartford.com/