How Open Innovation Can Shake-Up Auditing and Accounting

Published Nov-05-12

Breakthrough:
Internal auditors help to shape the future of audit technology in an open innovation contest.

Company:
TeamMate, United States

The Story:

Yes, open innovation can accelerate the pace of innovation, design better products and services and provide access to good and perhaps even better ideas. But its potential isn't just confined to R&D activity. External expertise can be brought to bear on many other business processes to help companies run leaner, better and more cost-effective operations.

Advances in Auditing

One of those areas is auditing and it’s ripe for innovation and development according the organizers of the 2012 Audit Innovation Competition. The contest was open to audit professionals all over the world and offered $50,000 in cash and prizes for the best ideas on applying technology to the auditing process.

The open innovation competition received a lot of attention and more than 400 auditors submitted more than 600 ideas during the four-month submission period. Registered users could vote and comment on these concepts which helped to inform the judges' opinions.

However, the panel had the power to select any ideas it believed to be promising, and submissions were judged on a number of criteria including broad applicability, design, feasibility and functionality.

“We pride ourselves in offering innovative audit technology that’s cutting edge and simplifies auditors’ daily tasks,” said Mike Gowell, vice president and general manager of TeamMate the company that hosted the competition. “With that in mind, we truly value the opinion of auditors and welcome their ideas on how we can continue to help them leverage technology to overcome challenges and better assess the risks facing their organizations.”

Throughout the competition bi-weekly prizes were awarded. These were for the top individual ideas in each contest category and the winners were given iPads and accessories.

Overall there were two Grand Prize winners who were each presented with a check for $5,000. The winning ideas were:

“Auditor Development Assessments” by Justin Anderson, manager of Internal Audit at Boston Scientific - integrates assessments of resource performance on audits to allow managers to provide actionable feedback in real-time. The aim is to ensure auditors are working toward career progression.

“Audit Team Collaboration” by Erica Maciel, manager of Internal Audit at Western Union - integrates social media into the audit management system to allow real-time collaboration among team members.

The Innovation Promises of Prizes

Prizes have long been used to drive innovation and there are many ways that they can bring about change. For example prizes can motivate individuals and teams to creative heights, enhance the skills of those involved, and encourage specific innovations.

Designing and delivering prized-based contests is not a walk in the park. They must have clearly defined goals, be marketed to the right kind of solvers who are knowledgeable about the genre and interested in the outcome, and of course they have to be managed well. Significant resources must be expended in a contest’s design including rules of participation and specifying the competitor pool.

Though an old idea, prizes are still a very powerful way for organisations to create game-changing ideas, technologies, products and processes.

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