Organisations accept the fact that innovation is a crucial element in achieving long-term competitive advantage. The key business challenge, however, lies in acquiring the expertise and methodologies needed to effectively motivate, support and nurture innovation. South African companies in particular are performing poorly in developing effective reward strategies to encourage and motivate innovation. This research therefore investigates the critical success factors for rewarding and motivating innovation in the workplace. The results of this study should assist executive managers to formulate reward strategies to stimulate innovation.
In line with qualitative research methodological principles, this study followed an exploratory approach to investigating the important factors in rewarding innovation. A total of 15 in-depth interviews were held with executive managers within the Financial Services sector. The sample represented a diverse group of highly successful business leaders, including General Managers (such as CEOs), Human Resource practitioners (such as HR directors) and Innovation Leaders (such as R&D leaders).
Key findings reflect that a multi-faceted reward strategy is required to motivate innovation. This includes financial rewards, non-financial rewards, learning and development opportunities, as well as specific elements within the work environment. Leadership was found to be a critical success factor in the implementation of an effective total reward strategy. The research allowed for the development of a framework outlining the critical success factors for rewarding and motivating innovation in the workplace. This is believed to be a useful tool for senior managers who wish to develop a total reward strategy to increase the level of innovation within their organisations. This study also contributes to the body of academic knowledge by clarifying the relationship between innovation and the notion of total reward, which was identified as a gap in the literature.