Got gamification yet? If you don't, you're not alone -- according to Gartner, fewer than 5% of organizations worldwide are using gamification. But get ready: Analysts expect enterprises to start embracing the technique in many areas over the next two years, and the impact, they say, could be far-reaching.
Brian Burke, research vice president at Gartner, defines gamification as "the use of game design and game mechanics in any kind of non-entertainment context." The technique involves adding an element of gaming to an application or platform. On an enterprise social site, for example, users could earn points by doing certain things -- such as sharing valuable information or helping another user with a problem -- with the person who earns the highest number of points receiving some sort of reward.
The goal is to use game psychology and game design to change behavior, explains Thomas Hsu, executive, global social collaboration at Accenture, which uses gamification internally and advises its clients on the topic as well. "Game designers are incredibly good at designing things that are fun and motivating, whereas typical tools used in enterprises were not designed with that in mind at all."
The earliest adopters of gamification typically used it to form a stronger bond with customers, so called "customer engagement." One example: SAP's Community Network (SCN), which comprises 2.5 million customers and partners. SAP has gradually added more and more gamification features to the 10-year-old network to encourage participation.
But now companies are gamifying internal applications to engage employees. Burke expects internal efforts to overtake consumer-engagement uses in the next year or so. By 2015, 40% of global 1000 organizations will use gamification as the primary mechanism to transform business operations, Gartner predicts. "We see gamification being leveraged for change management," says Burke. "We see that as a big opportunity."
In terms of growth, gamification has a "land and expand" kind of profile, says Carter Lusher, research fellow and chief analyst of the Enterprise Applications Ecosystem at Ovum. A company will add gamification to something on a small scale and get good results; the technique then starts spreading throughout the company. (See Gamification dos and don'ts for tips on successful implementation.) "People don't realize it's not about fun and games, but about creating engagement with employees, customers and partners," says Lusher. "Once they experience this themselves, then they get it."
Internally, gamification can be used in a sales contest, which results in more business, or to increase the effectiveness of a software rollout. "Every year organizations collectively spend billions of dollars on new software, such as business analytics or CRM or HR packages, and the problem is the users don't use it or they only use part of it or they use it incorrectly," says Lusher.
Gamification can help solve that problem. Vendors that offer software as a service, for example, could gather data on how people use their software and where they get stuck, which will help those vendors improve their products or offer better training, says Lusher.
The technique can also help companies assess their workers' competencies. "Gamification generates a tremendous amount of data on your employees' skill levels," points out Mario Herger, who worked on gamification at SAP until founding his own consulting company, Enterprise Gamification, in April of 2013. "If you gamified every system and every interaction in your corporation, you'd know exactly what each person does and at what level of skill."
Even without that degree of penetration, gamified enterprise systems have the potential to help companies easily zero in on employees with especially valuable knowledge and skills, says Herger. "This is potentially the largest and most valuable data cluster in the corporation."
Wanda Meloni, founder and principal analyst at M2 Research, estimates that consumer-facing gamification will make up just over 50% of the 2013 market, but by 2016 the enterprise will be responsible for 62% of that market share.
To find out how companies are using gamification and what benefits they are receiving, Computerworld talked to a handful of early adopters. Here, we highlight the three most interesting applications we found.
NTT Data Inc.
Headquarters (U.S.): Plano, TX
Number of employees: 60,000 total; 18,000 in North America
Number of IT employees: Everyone, with the exception of "a couple of thousand support personnel," says CTO Imran Sayeed. "IT is our business."
NTT Data started experimenting with gamification in 2011 as a way to encourage participation in its internal social network, which is called Socially. The company launched the social network to develop faster and better solutions to customer problems and spark innovative ideas, says Sayeed.
There was just one problem: When the company first launched Socially, only 400 out of the 7,000 employees in Sayeed's division (Application Development and Management) joined the networking platform. So Sayeed added what he called "karma points" for logging in, posting content and performing other activities on the platform. Each month the person with the highest number of points earned a prize, such as an Apple iPad. Within five months, participation had jumped to 4,000, he says.
The collaboration that gamification helped stimulate has led the company to create two new centers of excellence that are developing new products and services, says Sayeed.
Both centers -- one that addresses regulatory reports used in insurance, the other focused on mobile testing services -- came about after employees collaborating on Socially realized a custom service they were developing for one client would be of interest to other NTT Data customers.
In addition, NTT Data has launched a new consulting practice dedicated to gamification for its clients that want to explore the discipline.
So far the centers have generated "about $5 million in new services," according to Sayeed. Given that the company spent about $1 million to develop the new gamification practice and $200,000 to $300,000 to build Socially, "this was a very clear ROI," says Sayeed.
The company has recently expanded its internal use of gamification in two ways. In the spring of 2013, it launched a training game, called NTT Data Samurai, that guides employees through a series of questions to assess leadership skills, then offers customized training in the form of a quest (users must meet certain challenges and attain certain levels in order to scale Mt. Fuji). The application is helping the company pinpoint top performers as well as those who may struggle in certain areas.
"The nice thing about a game is that it collects incredible analytics, and so every manager can see the progress of their team members through the game, where they did well and where they are having issues, so they can offer to help them offline," explains Sayeed. "It starts painting a complete and quantifiable picture of your existing talent in the organization."
In addition, the company is piloting another training program, a secret-agent-themed game on smartphones, designed to help salespeople learn how to sell new products.
Lessons learned: Although they initially focused on extrinsic rewards like Apple iPads, NTT Data found that intrinsic rewards such as peer recognition were more effective motivators.
Along those same lines, if an organization's goal is to foster collaboration and communication, then gamification elements should be cooperative, not strictly competitive, Sayeed advises. To encourage this, NTT Data added "share only" points -- points that one employee can give to another for giving a good answer to a question or helping out in some other way -- to its social network.
Finally, Sayeed warns, it's only natural that some employees may try to game the system. They might post massive amounts of information, much of it unimportant or irrelevant, just to pile up the points. NTT Data has moderators who watch for this, Sayeed says.
Headquarters: Walldorf, Germany
Number of employees: 65,000
Number of IT employees: 1,900
Gamification has produced some valuable benefits in SAP's customer-facing SAP Community Network (SCN), where members can earn points and badges, and can advance levels, by helping fellow users in need.
The system has proved so popular that outsiders are using it as a rating system for talent. "We've seen individuals use their SCN status in their resumes and on LinkedIn profiles," says Mark Yolton, former senior vice president of digital, social and communities at SAP. "Their SCN status really indicates a degree of expertise and collaboration above and beyond the norm." That can help when looking for a new job or trying to raise their profile with their current employer, says Yolton.
Internally, SAP uses game elements on its corporate social network to promote participation and collaboration. It's also developed internal apps to encourage specific behavior. For example, SAP is piloting an app that uses gamification to encourage carpooling among its employees.
The app, called "Two-Go," matches up people planning to travel a certain direction at a certain time. Not only do employees get points and recognition for carpooling, but the app helps SAP further its corporate environmental goals and affords employees more chances to socialize and build bonds. SAP staffers may actually find the CEO in their car, something that happened in Walldorf, Germany, where SAP's co-CEO Jim Hagemann Snabe used the app to catch rides with random employees, says Yolton.
SAP is also starting to apply what it's learned about gamification to products. For example, it is working on an internal travel expense accounting application with gamification features. It would reward employees with points for timely and accurate reporting, says Yolton.
"We often test things on ourselves first and then take it out to the market, so I would not be surprised if gamification was added to the travel expense reporting and accounting app that we sell in the marketplace," Yolton says. In fact, SAP is considering embedding gamification in most, or even all, of its software, he confirms.
Lessons learned: Make sure gamification aligns with the goals of the individuals as well as the goals of the organization, Yolton advises. Gamification, he says, "can't be a management edict." Making someone play takes all the fun out of it, he says.
Location: Global; U.S. offices in New York, Chicago and elsewhere
Number of employees: 266,000
Number of IT employees: Undisclosed
Accenture also started using rudimentary gamification concepts early on, beginning in 2008, says Hsu, the firm's global social collaboration executive. That's when the company rolled out its Addo Agnitio Award to encourage employees to collaborate and share their knowledge via its online community.
Initially, employees earned points by filling out their online profiles and uploading content, for example. That's evolved into a system that now tracks more than 30 different activities, explains Steve Kaukonen, a senior manager on Hsu's team, with the goals of increasing productivity, reducing operating costs, spawning innovative ideas and improving employee engagement.
At first, Accenture rewarded participation with money -- each "Celebrating Performance" point was worth $1. And top performers -- those who shared the most content or whose blogs were most frequently read -- were also designated in the system by a gold star icon.
Still, surveys revealed that employees didn't always feel they were being recognized or rewarded for collaboration, according to Hsu. So today their collaboration scores are included as part of their annual performance reviews.
Both Hsu and Kaukonen stress that gamification is just one component of Accenture's overall program to encourage participation and collaboration, part of a broad initiative of change management.
Lessons learned: Hsu recommends that companies think carefully about what motivates people as they add gamification. Consider not only what will interest them initially, but what will keep them engaged. Extrinsic rewards might work at first, for example, but if there's not some kind of intrinsic reward that comes from participating, then interest can quickly wane, he warns.
Gamification dos and don'ts
Although Gartner expects gamification within enterprises to start taking off, it also expects some significant bumps along the way. For example, the research company predicts that next year, 80% of gamified enterprise applications will fail to meet their business objectives.
More often than not, the failure will be due to poor design, says Gartner researcher Brian Burke. Often companies design the game to achieve only the company's objectives (such as better trained salespeople), without any regard for the individuals playing the game (salespeople won't play the game unless there's something in it for them, too). And sometimes the objectives aren't defined at all -- neither the company's nor the individual's.
"If you don't know what you're trying to achieve, you're unlikely to achieve it," says Burke. Instead of having clear-cut goals, companies will say, "'Let's try this,' and then they look at the results and declare that a success," says Burke.
To avoid those kinds of pitfalls, follow these tips from analysts and early adopters:
-- Start with extrinsic prizes and rewards -- such as a $100 gift card for BestBuy -- that have allure to newbies, but then add and eventually transition solely to intrinsic rewards like peer recognition and career enhancement. NTT Data found that intrinsic rewards, such as being tapped for new assignments, were more effective at getting and keeping experienced employees engaged. "These are things that you can't go out and buy in a store," says NTT Data CTO Imran Sayeed.
-- Include elements to encourage cooperation over competition. The game can turn ugly when people's competitive nature kicks in and they race each other to achieve status. To address this, NTT Data started including "share-only" points. These are points that one individual gives to another individual for being particularly helpful.
-- Start small and then iterate. Accenture started by gamifying just a handful of elements in its online community, gradually building up to more than 30.
-- Make sure to reward quality, not just quantity. One way to measure quality is by proxy, looking at how much influence that person has, similar to Klout, says Thomas Hsu, executive, global social collaboration at Accenture. Don't just look at how much an individual posts on an internal social site, but who's reading it and how much conversation it generates.
-- Expect people to try to game the system. In a way, that's good, says Sayeed, "because if they are trying to game the system, that means they are engaged, right?" It's not hard to spot: You just need to notice if, for example, people on the leaderboards are amassing huge volumes of information. One way to address the problem is to reward people for quality over quantity (see above). But there is no cure-all, says Hsu. "Anytime you have gamification, it's not a matter of if people will game the system, it's a matter of what are you going to do about it. It's human nature to try to figure out how to beat the game."