Using gamification to stimulate employee innovation

E Zongliang ORCID: 0000-0002-8825-9660 Postgraduate student, Department of Personnel Management, Moscow State University named after M.V. Lomonosov 119192, Russia, Moscow, Lomonosovsky Prospekt str., 27 zongliange366@gmail.com

Introduction. Innovation, broadly defined as the process of developing new methods, ideas or products, serves as the basis for economic growth and increasing the competitiveness of companies in today's global market. As Schumpeter noted, innovation is the main driving force of "creative destruction", contributing to the displacement of established technologies in order to make room for new ones ^[1]. In an increasingly complex and interconnected economic situation, the role of innovation goes beyond simple technological advances and includes new business models, processes and organizational structures ^[2]. The economic consequences of innovation are quite significant – companies that prioritize innovation achieve higher profitability, market share and are better equipped to adapt to external shocks ^[3].

Although some researchers consider the availability of an innovative approach to be critically important ^[4], its implementation within an organization can cause many difficulties. Employees often encounter conflicting requirements for their time and focus resources and may seek to avoid risks, which leads to suboptimal investment in innovation activities. Moreover, innovation activity itself is characterized by a high degree of uncertainty, making it difficult to accurately assess and reward and encourage innovation. In this regard, companies are constantly looking for effective ways to stimulate the innovative activity of their employees.

In response to such challenges, stimulating innovation through gamification seems to be a compelling approach. Gamification is based on the principles of behavioral economics and uses elements of game design in non-game contexts to influence behavior. The application of human psychology related to motivation, reward and social interaction makes it possible to eliminate some of the shortcomings and inconsistencies of traditional economic models. It is important to note that gamification offers a flexible, adaptive structure that can be adapted to the unique needs and challenges of specific companies.

The purpose of this article is to study the economic foundations and consequences of using gamification to stimulate employee innovation. The author defines the key terms and provides an overview of the relevant literature to create a theoretical basis for the study. Subsequently, the author studies various gamification methods and provides practical examples to illustrate the effectiveness of each method. Based on the conducted research, the author offers a number of recommendations for companies and other stakeholders. The author offers both academic and practical ideas that will bridge the gap between economic theory and organizational practice.

The main part. 

The concept of gamification has gained popularity since the early 2010s. In general, gamification refers to the application of game mechanics in non-game contexts ^[5]. Despite the fact that the assumption of incompatibility between work and play is still widespread, it is not confirmed in practice. G. Zikkerman and J. Linder emphasize the practical value of gamification, considering it as a tool that complements and improves the effectiveness of an organization's branding strategy. They point out that the concept of gamification should be based on the effective use of gamified techniques or elements borrowed from online games, the experience of developing loyalty programs and the provisions of behavioral economics ^[6].

K. Verbach and D. Hunter also support the idea of using gamification as a business tool, focusing on the development of so-called "game thinking". They define gamification as "a game of thinking in practice"^[7] and rightly point out that gamified systems are not required to copy game mechanics. The main purpose of gamification is to use the psychological aspects of the game.

Summarizing the available theoretical approaches, it can be argued that gamification is the strategic implementation of the application of game elements, including, among other things, scores and ratings, in the context of a non–gaming context, such as a workplace, educational institution or health care system, with the obvious goal of increasing the level of engagement, stimulating specific behavioral changes and achieving predetermined results.

Scientists offer a variety of interpretations of the concept of innovative activity of employees. For example, V.N. Belkin, N.A. Belkina and O.A. Antonova characterize innovative activity as "the realization of the creative abilities of enterprise managers aimed at increasing production efficiency and competitiveness of the enterprise" ^[8].

A.V. Gankina describes the innovative activity of employees as "the activity of [staff] in the field of development, discussion, and implementation of innovations within the framework of their work activities" ^[9].

The aforementioned definitions of employee innovation offer different perspectives, but also have limitations. The definition of Belkin, Belkina and Antonova emphasizes the ultimate goal of improving efficiency and competitiveness, which provides a clear benchmark for measuring success. However, their definition is narrowly focused on managerial roles, potentially overlooking the contribution of non-managerial staff. On the other hand, Gankina's definition is more inclusive and covers the entire life cycle of innovation — from development to implementation. However, it lacks attention to the desired result, as a result of which the deadline remains open.

Considering these considerations, the author proposes a more concise and comprehensive definition. Employee innovation is the systematic participation of individuals at any organizational level in the development and implementation of new ideas aimed at improving operational efficiency, competitiveness or creating new revenue streams.

As part of this study, the author conducted extensive research on the implementation of gamification strategies in companies in various industries. The study covers technology startups, established manufacturing enterprises, healthcare and the service sector. Along with other researchers ^[10], the author notes that the use of gamification is becoming more common.

Based on the conducted research, the author proposes the following classification of methods of using gamification to stimulate the innovative activity of employees:

1. Incentive-based methods.

2. Competition-oriented methods.

3. Identity-oriented methods.

4. Methods based on recognition and feedback.

Let's look at these methods in more detail. Incentive-based gamification methods are well-thought-out strategies designed to motivate employees to be more active and involved in the workflow. These methods are based on the principles of the theory of economic incentives, according to which individuals are more actively involved in activities if there is an opportunity to receive both short-term and long-term incentives. Various forms of rewards are used in this scheme, including points, rewards, and even financial rewards.

This approach has a number of advantages, including increasing employee participation in the workflow and simplifying implementation. However, it is necessary to take into account some difficulties. For example, employees focused on short-term incentives may be inclined to perform tasks aimed at achieving immediate results, while ignoring the strategic goals of the organization. It should also be noted that the cost of staff incentives may increase due to the need to ensure a sufficient level of remuneration.

Examples of successful application of such methods can be found in large companies such as Salesforce and Google. Employees of these organizations receive points for various achievements, such as successful conclusion of transactions or active participation in corporate educational programs ^[11]. The accumulated points can then be exchanged for various forms of rewards, which creates incentives for continuous professional and personal development. For example, Salesforce has a multi-level reward system in which participants in innovative projects, upon achieving certain results, can increase their status in the organization and gain access to additional benefits and incentives, which, in general, contributes to a high level of innovative activity throughout the company. For many years, Google has been holding a Google Code Jam competition among programmers in order to find talented specialists and hire them ^[5]. Although at first glance it may seem that the main purpose of this competition is to provide the main winner with a prize of fifty thousand dollars, in fact, Google conducts this competition to identify the most promising participants who can make a significant contribution to the development of the company.

Competition-oriented gamification methods involve the use of various competitive mechanisms, such as honor boards or rating systems, to stimulate innovation and develop the creative potential of employees. These methods find their theoretical justification in the context of the economic theory of the competitive market, according to which competition is an effective way of allocating resources and is able to stimulate an increase in productivity and the level of quality of work.

One of the most significant advantages of such methods is the activation of the creative and innovative potential of employees. Healthy competition makes employees want to surpass their colleagues and show outstanding results. It is also worth noting that these methods are easily adapted to existing business processes and do not require radical changes in the organizational structure. However, this approach is not without drawbacks. A competitive environment can sometimes reduce the level of cooperation between employees and even lead to interpersonal conflicts. In addition, not all employees react equally to competition – for some, teamwork is more comfortable, and they may feel uncomfortable in a competitive environment.

Microsoft and Cisco use game elements in non-game contexts to increase the engagement and motivation of their employees. In particular, they apply a system of ratings and competitions between employees to stimulate their innovation activity. For example, at Microsoft, internal tournaments among developers encourage the creation of innovative software solutions, and participants can win various prizes ^[12]. At Cisco, leaderboards track and reward employees who actively participate in corporate educational programs, fostering a culture of continuous learning. Burger King has developed a game in which participants grow products for the menu and thus stimulate an increase in sales. Game monitors are available for viewing by cashiers, chefs and managers. The manager can add tasks to the “gardens” of employees at his discretion. According to the company, sales, supported by game mechanics, increased by one and a half times ^[5].

Identity-focused gamification techniques offer employees participation in interactive situations or business games that aim to strengthen their identification with organizational goals or specific projects. This approach is consistent with the principles of the economic theory of social identification, which states that the subjective feeling of belonging to a particular group or project can significantly increase the level of motivation and, as a result, productivity.

One of the key advantages of this method is to create a strong sense of belonging among employees. When employees feel that their activities are closely related to the goals of the organization, this has a positive effect on their desire for innovation. However, the implementation of these methods may require considerable effort and time to develop suitable scenarios, role-playing games or other interactive formats. In addition, the reaction of employees to such methods may differ, which can lead to an uneven degree of enthusiasm and effectiveness in the working group.

Companies such as IBM and Deloitte use gaming techniques in a non-gaming context, such as role-playing games and scenario techniques, to train and develop their employees ^[13]. This helps employees better understand the goals and objectives of the company, as well as promotes the development of leadership skills and strategic thinking.

Table 1. Classification of gamification methods for stimulating employee innovation activity.

Source: compiled by the author

Recognition and feedback-based methods focus on the active use of feedback mechanisms and incentive options to stimulate employee engagement and motivation. This approach finds its justification in the economic theory of principal-agent relations, which analyzes the relationship between employees (agents) and management (principals). According to this theory, positive recognition and constructive discussion of feedback can significantly improve these relationships and, as a result, increase productivity.

One of the most important advantages of this approach is to increase the level of satisfaction and motivation of employees who feel that their efforts have been well-deserved recognition. This, in turn, stimulates the creative potential of employees and their innovative activity. Nevertheless, feedback mechanisms must be carefully applied to avoid possible abuse or distortion. An unbiased assessment can lead to a negative result, causing employees to feel disappointed and a decrease in motivation.

Adobe and GE use feedback and reward systems to motivate and foster innovation among their employees. Adobe uses a constant feedback system in which employees regularly discuss their successes and problems with management, contributing to the creation of a culture of innovation ^[14].

Thus, four key gamification methods for stimulating employee innovation activity are considered (Table 1). Each of them has its own unique advantages and disadvantages, which must be taken into account when choosing a strategy.

Conclusion. In a modern economy characterized by a high level of competition and rapid pace of change, innovation is a key factor in the success of organizations. However, stimulating the innovation activity of employees remains a difficult task. In this context, gamification offers modern, effective methods to motivate employees to innovate.

Despite the positive results and the increase in the use of gamified programs in various business areas, the introduction of gamification into personnel management is slow. Only 17% of international organizations use such methods. In Russia, the percentage of use is even lower: according to a sociological study of HR specialists: only 6% of respondents are familiar with gamification and use its tools in their gamification projects were coordinated with the development strategy of a modern organization ^[5].

It is necessary to invest in corporate education in order to ensure the hiring and retention of professional employees in the business, creating a competitive advantage for the company ^[15]. This aspect is especially important, given that gamification often includes elements of learning and development, and can serve as an additional incentive for employees as part of a corporate educational strategy.

Within the framework of this article, an analysis of four key gamification methods has been carried out in order to apply them to stimulate the innovative activity of employees. These methods provide unique mechanisms to address issues of motivation and employee engagement in innovation processes. In practice, each method has its own set of advantages and possible difficulties, and the choice of a specific approach should be based on a comprehensive consideration of various aspects: from the characteristics of corporate culture to strategic goals and resource capabilities of the company.

In general, gamification can become an effective alternative to traditional personnel management tools in the coming years, since it is able to form the unique experience of the organization's employees, give additional meaning and direction to their activities, increase motivation and involvement in the company's work, as well as generate profit. To ensure the most effective and lasting impact on innovation processes, it is necessary to take into account not only commercial goals, but also the personal needs of employees. This involves careful planning and an adaptive approach, in which each component of the gamification system is precisely configured according to the specific characteristics of the organization.

In conclusion, gamification is an effective management tool with great potential to stimulate employee innovation. When applied correctly, it can not only increase the motivation of employees, but also significantly enhance the economic efficiency of the organization in the long term.

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