How World of Warcraft Promotes Innovation

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The degree of challenge increases dramatically as players play WoW.

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What if these dashboards were made available to everyone in the company? What if these dashboards could be designed and tailored by the individual employee? What if these dashboards provided real-time feedback on individual performance as well as the performance of the broader group? What if this feedback was visible to everyone and not just the individual contributor? Within WoW, this real-time performance feedback helps players to focus their innovation in game play on the areas with greatest impact.

Keep raising the bar

WoW designers have constructed an environment that continually challenges players to develop new skills. Complacency and boredom are rarely encountered, but neither is frustration, since challenges are thoughtfully calibrated to the existing capabilities of players. The next rung of achievement is just in sight, motivating players to invest the time and effort necessary to achieve that next level of performance. In the real world, companies, particularly those pursuing high growth strategies should provide a continuing set of new challenges to drive innovation by their employees.

Don't neglect intrinsic motivations

Talk about incentives in a business context, and the discussion quickly falls back to cash. With minor exceptions, cash is not an incentive to play WoW, so the designers focused on intrinsic motivations. Players get widespread recognition as they master new skills and successfully address each new challenge. As the game advances, players learn to collaborate and participate in "guilds"—teams of players who must work together to innovate in their game play and achieve the next level of performance. As relationships and trust develop within these teams, everyone is motivated to innovate by the desire not to let the team down.

Provide opportunities to develop tacit knowledge, but do not neglect broader knowledge exchange

The guilds foster the relationships and trust required to generate new tacit knowledge—the kind of knowledge that cannot be easily expressed and develops through shared practice. This is where most of the innovation in game play occurs.

At the same time, the game has generated a rich ecology of online forums where players can share experiences, post requests for help in addressing new challenges, and learn from each other. These forums provide a "pull" platform where players encountering unanticipated needs can quickly reach out and assemble helpful resources. In contrast to knowledge management initiatives in more conventional corporate environments, a significant part of a player's recognition and status accrues from participation in these forums. In fact, these forums have become a primary vehicle for identifying high performing players to be recruited into guilds.

Create opportunities for teams to self-organize around challenging performance targets

Participation in guilds in WoW is not mandated from above. Players naturally coalesce into guilds as they move into more advanced levels because they realize they cannot accomplish the tasks without collaborating with others with complementary skills. Teams have become important organizational units within companies, but how many of these teams are self-organized? By giving teams the autonomy to recruit new participants and—equally importantly—expel participants who are not carrying their weight, companies can significantly increase the accountability and motivation of teams.

Encourage frequent and rigorous performance feedback

WoW designers built in detailed performance metrics specific to the individual, the role, and the guild. These provide a foundation for regular after-action reviews where all the participants come together after a major initiative to review how they performed as individuals and as a team. The key focus is on how they can do better. This is a catalyst to innovation in game play as players can see performance gaps that are holding back the progress of the team.

These 360-degree performance reviews ensure that everyone from the guild leader down to the newest member receives feedback. Unlike the 360-degree reviews that have begun to crop up in a corporate setting, the reviews are based on objective, quantified performance metrics and visible to all participants. In this environment, poor performers at all levels have a strong incentive to address performance gaps in order to avoid being sidelined in future initiatives.

Create an environment that rewards new dispositions

WoW not only encourages players to develop new skills; it fosters a new disposition. WoW has created a compelling environment that naturally attracts participants interested in gaming, but it also enhances and rewards their dedication over time.

This encourages players to seek out new challenges as an opportunity to innovate and learn faster. Rather than viewing the unanticipated as a threat, gamers learn to welcome unexpected events as an opportunity to innovate, tinker, experiment, and, in the process, learn even more.

They also learn to welcome collaboration as an opportunity to learn faster by focusing on a set of individual strengths while being exposed to the diverse perspectives and experiences of those with complementary strengths. At the end of the day, this is the most powerful contribution of WoW. This disposition creates an amplifying effect throughout the game. Players seek out other players who share this point of view, and they end up performing better than players who bring more conventional ideas to the game.

Companies seeking to thrive in a world of increasing uncertainty and accelerating change will need to foster this disposition among their own executive team and employees. They would be well advised to take a closer look at World of Warcraft, both in terms of the approach taken to foster this disposition and as a potential recruiting ground for employees who can bring this attitude and approach into the company.

John Hagel and John Seely Brown are co-chairman and independent co-chairman, respectively, of Deloitte LLP's Center for Edge Innovation. John Hagel writes a blog at Edge Perspectives. Their monthly column, Innovation on the Edge, explores what executives can learn from innovation emerging on various forms of edges, including the edges of institutions, markets, geographies and generations. Sign up here for an RSS feed.