I think a prize makes the most sense when the terms are crystal clear and all competitors know exactly what they’re aiming for – as is the case for all the examples you cite.
A prize for "innovation" – without clear terms for what this means – seems unlikely to change anyone’s behavior.
Holden is right. If you look at how X Prize for space flight or the new Google Lunar X Prize works, they are highly specific about what constitutes winning. This format allows anyone to compete without concern that the process is really a popularity contest. On the other hand, many of the problems of philanthropy stem from our inability to quantify outcomes.
I think the big problem in philanthropy today is our inability to define, identify and measure impact; the positive outcomes that philanthropy generates. If I were to create a grand prize for philanthropy, it would be awarded to the person who came up with the best way to define, identify and measure impact. But I don’t think that we can quantify what that outcome would look like the way that Holden suggests.
Meanwhile, reader Suzy asks:
I sometimes wonder about the value we place on innovation. Don’t get me wrong we certainly want to do things as efficiently as possible…but sometimes doesn’t it simply require that we roll up our sleeves and just dig in and do the work?
I’ve heard this from a few different corners recently. I don’t value innovation more highly that other attributes, but I do think it is an area where philanthropy is particularly weak. Given the lack of market mechanisms in philanthropy, having everyone keep doing things the old way without much change is a very sustainable state. Market mechanisms force out players that don’t change with the times. Without the markets working for us, philanthropy must put added emphasis on innovation as a core value.