Challenge contests and prize competitions lead to better, cheaper technology

The federal government needs to do more to leverage challenges and prizes to find innovation, according to two government officials who oversee federal research and development agencies.

The U.S. government should use more contests, challenges and prizes to find technological innovations and savings, according to two government officials who oversee federal research and development efforts. 

At Thursday’s PeaceTech Summit in Washington, D.C., Ann Mei Chang, the executive director of the U.S. Agency for International Development’s Global Development Lab, and Jason Matheny, the director of the Intelligence Advanced Research Projects Activity, said federal challenges and prize competitions often unlock innovations that are rare in traditional federal contracting — and cheaper. 

Chang said competitions sometimes even allow the government to reach a global audience, which can’t be done in a world of RFPs and RFIs.

“The level of creativity we get from [contracting] is very limited,” Chang said. “We are missing 99.999 percent of the population’s great ideas. The idea of these challenges is really to figure out how do we tap into the ingenuity of not only of these big multi-national [companies], but of entrepreneurs that really understand the issues.” 


Matheny says the work that he has seen come out of challenges is every bit as good as what the government has pulled in from contractors, and at a price that’s better for cash-strapped feds, too.

“Folks working out of their basements and garages are often as good and usually a lot of cheaper,” he said. “We’ve been able to get the same performance for about one-tenth of the cost.” 

The focus on being cost-effective is something Matheny examines when the agency puts research contracts on He often weighs whether to run a prize competition alongside traditional contracting means to cover untapped markets. 

“Thanks to the America Competes Act, every federal agency can use prize challenges to deliver a solution to a problem they have,” Matheny told FedScoop. “Not only do all federal organizations have the ability to run challenges, they have access to advice and consulting on how to run challenges that are most cost effective.” 

Both Chang and Matheny said agencies should be working to scale challenges and competitions to the point where the work done related to the challenge — and just not the eventual end project or award winner — furthers agency’s broader missions. 


“Challenges are absolutely valuable in getting these new ideas out there,” Chang said. “I think there are so many great ideas out there, but we are not investing enough in the 99 percent that’s necessary to really get them to impact [these programs].” 

That impact will only grow, Chang said, when agencies realize the smartest innovators in the world can help the government with their most pressing problems without the rigor associated with winning contracts.

“The long term is for us to figure out how to reward and incentivize not just the ideas, which is where all the attention lies, but incentivize outcome and impact,” Chang said. “How can we do more to get results?

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Greg Otto

Written by Greg Otto

Greg Otto is Editor-in-Chief of CyberScoop, overseeing all editorial content for the website. Greg has led cybersecurity coverage that has won various awards, including accolades from the Society of Professional Journalists and the American Society of Business Publication Editors. Prior to joining Scoop News Group, Greg worked for the Washington Business Journal, U.S. News & World Report and WTOP Radio. He has a degree in broadcast journalism from Temple University.

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