Many people who heard U.S. President Barack Obama’s State of the Union speech last week found it uncharacteristically uninspiring. One of its few powerful notes, though, was its focus on innovation as the remedy to America’s economic malaise. Recalling the space race with the Soviet Union during the 1950s that unleashed innovation in new technology and ultimately created millions of jobs, the President said, “This is our generation’s Sputnik moment.”

A week later, the White House has followed up on that rhetoric with a program that promises to invest $2 billion in innovative small businesses. Headed by former AOL CEO Steve Case, the new initiative — named “Startup America” – envisages two fiscal measures. First, it seeks to make permanent the elimination of capital gains tax for key investments in small businesses, which was introduced last September as a temporary measure. And second, the program aims to expand tax credits for private sector investments in start-ups. In addition, the Small Business Administration (SBA) is being asked to direct $2 billion in funds over the next five years to “match private sector investment funding for start-ups and small firms in underserved communities, as well as seed and early-stage investing in firms with high growth potential, through its Small Business Investment Company (SBIC) program,” according to a media report.

At Knowledge at Wharton, we see this renewed thrust on innovation as being particularly timely. The reason is that we have just launched our second Innovation Tournament in collaboration with Wipro Technologies, a software services firm in Bangalore, India. The competition is based on Innovation Tournaments: Creating and Selecting Exceptional Opportunities, a book by Wharton professors Karl Ulrich and Christian Terwiesch. The professors see such tournaments as a way to discover a handful of outstanding innovation opportunities from among a large number of alternatives. As Ulrich explained in an interview last year, “A tournament, like its counterpart in sports, is one in which you have a large number of candidates who enter a competition, but only very few emerge as truly exceptional. The challenge is how to evaluate the candidates without going out of business, without spending a lot of resources.” Winners of a similar tournament organized last year succeeded in finding innovative tools to predict stock-outs and solve other problems that bedevil supply chains.

This year’s tournament presents potential participants with two challenges. The first is to come up with path-breaking ideas in the area of sustainability and green technology/clean energy. Second, participants are encouraged to propose solutions involving so-called customer-centric innovation, such as expanding into underserved markets, creating new classes of customers, and so on. In each instance, the competition invites bold new ideas that have never been attempted before, as well as tried and tested solutions that have yielded measurable results. Winners of the tournament are being offered a grand prize of $20,000 and three other awards.

In short, these are good times for creative, innovative people. Everyone – from the Obama administration to Knowledge at Wharton – wants a piece of your mind (and your time).

Editor’s note: To learn more about the Innovation Tournament, click here.