District and state school leaders setting up prize competitions to generate innovative solutions can find a blueprint in “The Craft of Incentive Prize Design – Lessons from the Public Sector,” a white paper from Deloitte University Press released in June.

The 84-page report analyzes successful government and nonprofit prize competitions, or challenges, and how incentives can be designed to engage the public and elicit responses providing a range of potentially successful solutions.

A challenge can be used to attract new ideas, build prototypes, launch pilots, or stimulate markets. Other purposes include raising awareness and inspiring systemic transformation. In the past five years, the U.S. government has administered 350 such challenges.

At a more local level, New York City public schools began experimenting with this approach last year, conducting a School Choice Design Challenge, a Gap App Challenge to address wide disparities in middle-school math achievement, and a Music Education Hack-a-thon.

To be successful, school leaders must identify the high-level outcomes they want to achieve from a competition, and those outcomes need to be measurable in some way, said Jesse Goldhammer, a principal at Doblin, Deloitte Consulting LLP’s innovation practice, in an interview.

“It wouldn’t take lot of time and money to develop a prize that rewards teachers who are able to increase meaningful test scores over some period of time,” Goldhammer said. But test scores need not be the litmus test. It could be something he described as more “holistic,” like reducing homework that proves to be ineffective at advancing knowledge retention.

“You want to design it in such a way that you’re not prescribing what the solution is, and you’re rewarding only when people solve it—so you’re paying for the results,” he said.

Examples he identified in education included those of the Broad Foundation, which awards $1 million in college scholarships for students in winning districts in its urban education competition, and $250,000 for college readiness efforts to public charter schools that best achieve certain goals. Ashoka Changemakers teamed up with the LEGO Foundation to find educational innovations through the Re-imagine Learning Challenge, in which 10 “champions of learning through play” will receive a total of $200,000 from the foundation. And the Aspen Institute has established the $1 million Prize for Community College Excellence, which is awarded every two years.

Goldhammer said his report provides a framework, rather than a recipe, for effective prize design. “For someone who’s a little creative and entrepreneurial, they could use the report to create a reasonable prize,” he said. Interested state education departments or districts might seek help in vetting prize designs from nonprofits like the Kresge Foundation, which is based in Troy, Mich., or the Knight Foundation, based in Miami, Fla., he added.

Steven Hodas, executive director of Innovate NYC Schools and a 2014 Education Week Leader to Learn From, leads challenges in New York City for the iZone, a community of nearly 300 public schools in the city committed to personalizing their learning environments to accelerate college and career readiness for students. He described that process in a recent webchat, “Solving School Problems Using Crowdsourcing and Hackathons,” which is archived.