12. Citizen Innovation in Fab Cities

Organizations increasingly use competitions (or challenges/contests) to elicit solutions to problems that they face (Boudreau et al., 2011; Mihm & Schlapp, 2019). When hosting such competitions, organizations formulate a problem at the outset and issue an open call, inviting individuals from outside the organization to come up with solutions. Those individuals who contribute the solution deemed best receive a prize. By hosting such competitions, organizations can tap into valuable knowledge that they lack internally (Piezunka & Dahlander, 2015; Jeppesen & Lakhani, 2010), and increase their visibility with audiences that they otherwise would not have reached.

Competitions have been historically important in pushing science and innovation. In the fifteenth century, the city of Florence offered a prize to the individual who would find a way of building the widest and tallest cathedral dome (Jeppesen & Lakhani, 2010). In the eighteenth century, the British Parliament offered a prize to the individual who would reliably determine longitude at sea (Boudreau et al., 2011). More recently, governments across the globe reached out to citizens to elicit ideas on how to fight the pandemic.

In this vein, Fab City Hamburg organized a challenge to elicit ideas for “social, sustainable, and innovative products that can be produced locally”. Ideas should be simple enough to be implemented by anyone with access to the machinery (e.g., 3-D printers) found in one of the several Fab Labs. The winners would be given the opportunity to further develop their ideas into prototypes in a professional workshop, a possible door opener towards the commercialization of their products.

As organizations more and more often resort to innovation challenges as a mechanism to solve problems, research on innovation challenges has flourished. Questions in this stream of research include, among many others, how many participants organizations should admit to competitions (Boudreau et al., 2011), and what kind of feedback they should give participants (Mihm & Schlapp, 2019). In their influential study from 2010, Jeppesen and Lakhani explored the characteristics of participants who contributed the most valuable (that is, winning) ideas. Focusing on the distance between participants’ technical expertise and the area to which the problem pertains, they find that marginal individuals – i.e., those whose own expertise is un- or only faintly related to the problem at hand – provide the most valuable solutions. This finding has provided important insights into the kind of individuals who organizations should target with these competitions: organizations should seek to engage individuals whose field of expertise is relatively distant to the focal area of the problem.

However, despite the importance of this study in advancing the discipline’s understanding of the relationship between individual background characteristics and idea value, there are many other individual-level characteristics that are plausibly predictive of idea value but have not received any attention from literature. Specifically, individuals’ motivation to participate in challenges might be systematically related to the value of the solutions they propose. In fact, prior research suggests that individuals whose primary participation motive is of a non-financial nature (e.g., peer recognition, joy of innovating) outperform those who are primarily financially driven (Ederer & Manso, 2013). If individuals produced differential idea values depending on their participation motive, this would have powerful implications on the competition designs, specifically with respect to prizes. In this article, we shed light on the relationship between participation motives and innovation performance.

Past innovation research has extensively studied what motivates individuals to engage in innovative activities. Until the 1990s, the dominant answer to this question was profit-seeking: individuals engage in innovation expecting pecuniary rewards – they come up with, develop, and implement innovative ideas because they expect to generate profit from them.

While profit-seeking motives might be one reason why individuals engage in innovation, research in the 2000s began to point out that such profit-seeking motives cannot sufficiently explain innovative activities. Most famously perhaps, Lerner & Tirole (2003, 2005) asked in the light of the growing open-source movement: “Why should thousands of top-notch programmers contribute freely to the provision of a public good?” By openly revealing and sharing their code with others, programmers forgo profit-seeking opportunities, suggesting that they are driven by other motives.

Subsequent research sought to identify the various motives driving innovative activities. Broadly speaking, these motives can be categorized into extrinsic and intrinsic ones. Individuals are extrinsically motivated if they expect to derive some benefit from an external environment (Ryan & Deci, 2000; Sauermann & Cohen, 2010). This external environment might be a peer community if individuals engage in innovative activities to gain peer recognition, or it might be a market if individuals seek profits from their innovative activities. As such, profit-seeking is one extrinsic motive (of several) to engage in innovative activities. On the other hand, individuals are intrinsically motivated if they derive benefits from the innovative activity itself. For example, individuals are driven by intrinsic motives if they derive great joy from a certain activity or if they have a deep interest in a certain field.

While a large body of research has investigated the various motives that drive individuals to engage in innovative activities, there is very scant research on how these motives relate to innovation performance. For example, do individuals who engage in innovative activities out of profit-seeking motives produce more or less valuable innovations than those who are driven by peer recognition? Sauermann and Cohen (2010) explored (in a company context) how employees’ innovation motives relate to their innovation performance. They find that employees who are driven by intellectual challenge, independence, and money produce more valuable innovations than those whose primary motives are job security and greater levels of responsibility. However, it is unclear how these findings generalize to the case of competitions where motives such as job security and levels of responsibility do not apply and independence is, by design, a given. At the same time, understanding how innovation motives are related to innovation performance in competitions is key for organizations that wish to attract the most valuable ideas. If organizations know which motives yield the most valuable ideas, they can target individuals and select prizes accordingly.

The Fab City Hamburg Maker Challenge provides an ideal setting to study the relationship between individuals’ innovation motives and innovation performance. This challenge took place in June 2022 with the goal of eliciting and rewarding ideas that would help make Hamburg a more social, sustainable, and self-sufficient city. As a prize, the individuals with the top-20 ideas would be invited to a prototyping workshop that would help them develop their ideas into a fully-fledged product. In addition, the best idea would win a 3-D printer. Individuals had roughly four weeks to submit ideas. After that, they had to specify why they wanted to participate in the challenge. They could choose from the following options: “I participate in the Maker Challenge …

Once the submission deadline had passed, the ideas were evaluated by citizens in a pairwise comparison: citizen-voters were shown randomly paired ideas and had to indicate their preference. Any citizen based in Hamburg could vote, provided they had signed up. The ideas were ranked according to who had won pairwise comparisons, with those ideas winning pairwise comparisons the most often at the top. Based on this ranking, the top 35% of ideas were identified, and then assessed by expert judges in (again) pairwise comparisons. These expert votes formed the basis for the final ranking of ideas.

Ninety distinct individuals submitted 110 ideas. As illustrated in Fig. 12.1, individuals most often participated in the competition for altruistic reasons (42%), followed by the desire to contribute to the community (21%), to experiment with 3-D printing (13%), to learn from feedback (7%), to turn their idea into a startup (6%), for financial rewards (5%), and to help make Hamburg a better place (2%). Thus, financial rewards played only a minor role as driving force for participation.

Next, descriptively, we examine how the various motives relate to performance in the competition. We consider two performance outcomes:

Thus, the first performance outcome variable is binary (1 if an idea made it to the top 35%, 0 if not). The second performance outcome, the expert score, is a continuous variable that takes any value between 1 (best possible) and 0 (worst possible). This expert score represents the share of pairwise comparisons won by an idea. For example, an idea has an expert score of 0.7 if it won 70% of the pairwise comparisons; an idea has an expert score of 0.1 if it won 10% of the pairwise comparisons. By construction, the mean expert score is 0.5.

We see in Fig. 12.2 that those individuals whose primary motive to participate in the competition was altruism were also the ones with the most valuable contributions as assessed by the citizen judges. Almost half (48%) of the ideas that were submitted by altruistically motivated individuals made it to the top 35% of ideas, followed by 43% of the ideas submitted by individuals whose primary motive was to turn their ideas into a startup. Those who participated in the competition to derive financial rewards had a success rate of 33%, which is 15% points below the altruistically motivated ones. Those who participated to experiment with 3-D printing had the lowest success rate (22%), possibly because they lacked any prior experience with 3-D printing.

Next, we examine how expert (rather than citizen) votes vary depending on participation motives, provided an idea made it to the top 30%. Figure 12.3 shows, evaluation outcomes no longer differ as strongly with participation motives as above. Those whose primary participation motive was to make Hamburg a better (more sustainable and social) place received, on average, the most favorable expert score (0.62). Note, however, that this finding is generated based on one observation only: three individuals indicated that they participated to make Hamburg a better place, and of those only one made it to the top 35%. Hence, this finding does not allow for any solid inferences. Those whose primary motive was to learn from feedback received, on average, the lowest scores (0.38). Those whose primary participation motive was altruism received an average score of 0.51, which is slightly above the overall average score. Hence, if innovation motives are at all predictive of innovation performance as measured by expert votes, altruistic motives are associated with superior innovation performance.

We also estimated the relationship between participation motives and innovation outcome in a series of regression models. Specifically, we predicted the likelihood of ideas to become top 35% based on participation motives. Using logistic regressions, we found that ideas that were submitted for altruistic reasons were more than 3.2 times more likely to become top 35% than ideas that were submitted with a community motive (p < 0.05), and more than 3.6 times more likely to become top 35% than ideas that were submitted with an experimentation motive (p < 0.1). Results from linear probability models point in the same direction: compared with the altruistic individuals with a community (experimentation) motive had a 30% (28%) lower probability of ideas ending up in the top 35%. We did not find any evidence that participation motives other than community and experimentation mattered relative to altruism. We also did not uncover any statistically significant relationships in the second stage of the voting process, i.e., the expert voting, which is hardly surprising given the small sample size of 38 ideas.

Organizations across industries rely on challenges to elicit ideas to problems that they face. Challenges have thus become a key determinant of organizations’ innovation performance and continue to grow in importance as the knowledge required for successful innovation is increasingly distributed over a wide number of individuals inside – and outside – organizations. Given the importance of innovation challenges for organizational life, a growing body of research has investigated various questions related to innovation challenges: how many individuals should participate in competitions? Should participants receive feedback? Which individual background characteristics are predictive of innovation performance? The latter question has, surprisingly, remained rather less explored than expected. Specifically, individuals’ motivation to participate in challenges has not been considered as a determinant of their innovation performance in challenges. Yet, understanding the relationship between participation motives and innovation performance is key for organizations to target the ‘right’ individuals and to design prizes accordingly.

Leveraging the Fab City Hamburg Maker Challenge as an empirical context, this article attempts to fill this gap. After individuals had submitted their ideas to the contest, we asked them why they had done so. This information, together with the citizen and expert votes of ideas, allowed us to uncover links between participation motives and innovation performance. We found that those individuals with altruistic participation motives scored best with the citizen judges: almost half of their ideas made it to the top 35%, and hence to the next round of expert voting. Besides this descriptive evidence, we also found, based on logistic regressions, that individuals whose primary participation motive related to experimentation and community were substantially less likely to have their ideas chosen by citizens than altruistically motivated individuals. We could not replicate this finding in the second stage of the voting process, when expert judges assessed the top-35% ideas. This, however, is not surprising given the very limited sample of 38 ideas in this second stage.

This study comes with several limitations. First, it is based on (non-experimental) survey evidence, precluding any causal interpretation of the found results. Specifically, it is possible that participation motives are related to other unobserved variables that influence idea quality, and that this is what drives the relationship between participation motives and idea quality. For example, it is very likely that participation motives are related to prior experience in developing ideas, and that this experience also drives idea quality. Individuals who indicate an experimentation motive might have no or very little prior experience with 3-D printing, and this lack of experience might result in a low-quality idea. At the same time, individuals with altruistic motives believe by definition that others might benefit from their ideas, which might go hand in hand with higher-quality ideas. In this study, we were unable to control the influence of such unobserved variables. Future research should thus examine the effect of participation motives on the quality of ideas, and innovation performance more generally, experimentally.

Another limitation is that our results likely suffer from selection bias. Winners were promised a 3-D printer as well as the opportunity to participate in a prototyping workshop. As such, the competition attracted few individuals with pecuniary motives while speaking first and foremost to those with altruistic motives. Unsurprisingly, almost half of the participants indicated altruism as a participation motive. The choice of a prize means that our sample of participants is not representative of the general population. Future challenges should use different prizes to forestall such selection effects.

What implications can we draw based on our evidence that the quality of ideas tends to be especially high with altruistically motivated participants? Future Fab City challenges should target individuals that score high in altruism. To attract these individuals, prizes should be designed accordingly. The altruistic are unlikely to be attracted by monetary rewards. Rather, prizes should give participants a platform to further diffuse their ideas and help others implement their ideas. If the altruistic derive benefits from seeing others implement and use their ideas, this should be facilitated through (online and on-site) workshops that involve both innovators (or challenge winners) and users. As such, the prototyping workshops – though a right first step – should also involve potential users.

More generally, the Fab City Hamburg maker challenge demonstrates that involving citizens in innovation activities, e.g., via innovation competitions, bears great potential for a realization of the goals spelled out by the Fab City Manifesto, which is, among others, to make production more local, to encourage citizens to share their knowledge, and to make innovation more inclusive.