Parallel team strategy has been widely adopted by high-tech industries in knowledge creation. In this research, we study the design of organizational incentives, including a fixed wage payment and an additional reward structure, for the parallel team strategy. We consider two types of parallel teams—collaborative and non-collaborative parallel teams. Proposing and investigating two types of organizational reward policies (individual and aggregate) for both collaborative and noncollaborative parallel teams, we demonstrate the viability and characteristics of these policies and analyze the tradeoff between the number of parallel teams and their rewards. We show that collaboration in parallel teams is vital for obtaining maximal benefits. This research provides valuable insights for firms in employing parallel team strategy for knowledge creation.