Crowdsourcing: The Kids aren’t Always Right


One of the most interesting management tools of the past few years is Crowdsourcing (also known as open source development, peer production and collective intelligence).  First coined by Jeff Howe in an article in Wired magazine, Crowdsourcing uses the power of the internet to leverage a dedicated community of users to undertake important business activities like software programming & testing, data analysis, and product support.  Properly executed, Crowdsourcing can help firms reduce production & service costs, gain valuable insights and improve the speed of their business especially when mated with social media technologies 

Crowdsourcing programs have been successfully implemented in a variety of areas including the development of the Linux operating system and Wikipedia, the online encyclopedia. Commercially, Apple depends on thousands of users to deliver product support.  Procter & Gamble has asked amateur scientists to find a new detergent dye that changes colour when enough has been added to dishwater.  Finally, Unilever used crowdsourcing techniques to find new creative ideas for one of its UK brands.

Despite some noteworthy successes, Crowdsourcing may not deliver on all its promise.  For example-

Quality Results Could be Elusive

The majority of what the crowd generates is usually of poor or inconsistent quality.  Finding the diamonds in the rock takes lots of time, expertise and effort. All too often, there is little of value to be mined in the first place; many users and experts are simply unwilling to provide their services to companies at no cost. Finally, community-based activities are susceptible to faulty results arising from targeted, malicious work efforts.

Implementation is Not Easy

You don’t just sit back and rely on the crowd to handle important tasks.  Implementing Crowdsourcing is hard work requiring patience, active collaboration and project management.  According to Jimmy Wales, one of Wikipedia’s co-founders,“Any company that thinks it’s going to build a site by outsourcing all the work to its users completely misunderstands what it should be doing. Your job is to provide a structure for your users to collaborate, and that takes a lot of work.”

Costs & Risks are Higher than Anticipated

Crowdsourcing may not necessarily yield all the promised savings as significant management effort is needed to create the appropriate structure, manage & filter the input, and ensure project momentum.  Furthermore, utilizing crowds of strangers for mission-critical activities (e.g., customer support and software design) introduces the possibility of brand and legal risk.  For example, leveraging external users comes with no written contracts, nondisclosure agreements, or employee agreements.

Given the challenges, what can organizations do to maximize the return on Crowdsourcing programs?

1.  Your crowd is often unpaid so make it fun and easy for them to engage your firm.  When necessary tailor incentives to attract the most effective collaborators;

2.  Focus Crowdsourcing efforts against a specific, measurable task versus larger, more nebulous objectives;

3.  To find the diamonds, ensure you develop and apply key evaluation criteria which are enforced by a centralized, internal authority;

4.  Activity often comes in spurts so make sure your IT infrastructure has sufficient peak load capacity;

 5.  Make certain your culture is receptive to new ideas and collaboration;  your organization needs the right structure, people and process to manage Crowdsourcing initiatives.

 For more information on our services and work, please visit the Quanta Consulting Inc. web site.

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9 comments so far

  1. […] an obvious example of this effect.  Savvy organizations are leveraging herding behavior through crowdsourcing strategies that trigger word of mouth promotion, perform support and develop open source products like […]

  2. […] an obvious example of this effect.  Savvy organizations are leveraging herding behavior through crowdsourcing strategies that trigger word of mouth promotion, perform support and develop open source products like […]

  3. […] and customers around the world for good ideas.   As well, emerging open innovation models like crowdsourcing are bringing the ideas and thinking of the masses into the […]

  4. […] enlist their customer as product reviewers, referral sources and support staff through the use of Crowdsourcing strategies that leverage “the wisdom of crowds” and reduce operating costs.  Market leaders […]

  5. […] enlist their customer as product reviewers, referral sources and support staff through the use of Crowdsourcing strategies that leverage “the wisdom of crowds” and reduce operating costs.  Market leaders […]

  6. […] internally (e.g., iTunes) or externally through thousands of externally developed applications, crowdsourced technical support and functional […]

  7. […] internally (e.g., iTunes) or externally through thousands of externally developed applications, crowdsourced technical support and functional […]

  8. […] internally (e.g., iTunes) or externally through thousands of externally developed applications, crowdsourced technical support and functional […]

  9. […] testing and networked communications. Powerful web tools bring the market inside the firm, enabling crowd-sourced collaboration as well as the rapid prototyping of product ideas.  Furthermore, many employees must commit a […]


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