Why a hackathon may not be a good strategy for your company

Hackathons, or hackfests, are getting a lot of buzz for being a collaborative, crowdsourced way of generating new product or service ideas. Sometimes they’re even touted for ideas that drive change and create a competitive advantage. But if that’s what you have in mind for a hackathon at your company, prepare for a letdown.

The buzz isn’t all hype. Entirely new companies (such as GroupMe, which was acquired by Skype) have been birthed from hackathons. And Facebook’s “like” button originated in an internal hackathon at Facebook. Some hackathons resulted in government entities capturing new ideas on how to improve government services. And an increasing number of companies find hackathons to be an effective strategy for improving employee engagement.

Yes, you will get many great ideas by holding a hackathon. But when it comes to solving big, expensive problems in a business or when it comes to creating a competitive advantage, hackathons don’t play out the way executives hope they will. They fail to make a measurable difference.

The whole purpose of a hackathon is to bring in new ideas, and what business wouldn’t want to access “the crowd?” The thinking is: surely there is genius out there somewhere that we need to capture.

The truth is great ideas about how to solve a problem seldom create business value. Service providers, for example, ask their clients, “Let us take your problem and do a hackathon. We’ll come back with 13 great breakthrough ideas to solve your problem.” But it won’t really matter. You’ll get interesting and intriguing ideas. You’ll get great code. And it will feel like you’re making fast progress. But it’s just an illusion that it will solve a problem or create real value.

The Illusion of Technology Implementation

Often, business leaders believe that implementing clever technology will solve a business problem. Believing that there is purely a technology answer to a problem is an illusion. The technology relates to the rest of what a company is doing, so it requires making changes to those other aspects.

For example, digital technologies want to go end to end. What does that mean? Let’s look at processes involved in customer experience. The experience needs to be compelling and powerful. It needs to be on time and in full, meaning it completely solves a customer’s problem in a timely fashion that is acceptable to the customer. That’s the goal. And no smart app can do that.

Big issues are involved in improving customer experience. Ensuring value and customer experience that is on time and in full requires changing more aspects than technology. An end-to-end approach typically involves shortening cycle times and making other changes to processes, talent and even philosophies.

The problem with hackathons is they provide only tiny snippets of that end-to-end journey. The ideas sound great. But when it comes to solving a business problem and creating competitive advantage, a hackathon is just an illusion that you’re making meaningful progress toward those goals. You’ll need to drive deep and broad change for the hackathon-generated idea to produce real results.