Crowdsourcing

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"Crowdsourcing" is a neologism for a business model that depends on work being done outside the traditional company walls: while outsourcing is typically performed by lower paid professionals, crowdsourcing relies on a combination of volunteers and low-paid amateurs who use their spare time to create content, solve problems, or even do corporate R&D. The term was coined by Wired magazine writer Jeff Howe and editor Mark Robinson in June 2006.

Crowds targeted for crowdsourcing include garage scientists, amateur videographers, freelancers, photo enthusiasts, data companies, writers, smart mobs and the electronic herd.

Overview

Although it is similar in some aspects (like collaboration basis), it is a different model from open source projects that has existed for years. People who may not know one another work together online to create complex software such as the Linux kernel, and the Firefox browser. But in the OS model, everybody gets benefits for the global contribution. In recent years internet technology has evolved to allow non-technical people to participate in online projects. Just as important, crowdsourcing presumes that a large number of enthusiasts can outperform a small group of experienced professionals. In this new model of collaboration the results of the global efforts returns only in the organisation which leads the project.

Advantages

The main advantages of crowdsourcing is that innovative ideas can be explored at relatively little cost. Furthermore, it also helps reduce costs. For example if customers reject a particular design, it can easily be scrapped. Though disappointing, this is far less expensive than developing high volumes of a product that no one wants. Crowdsourcing is also related to terms like Collective Customer Commitment (CCC) and Mass Customisation. Collective Customer Commitment (CCC) involves integrating customers into innovation processes. It helps companies exploit a pool of talent and ideas and it also helps firms avoid product flops. Mass Customisation is somewhat similar to collective customer commitment; however, it also helps companies avoid making risky decisions about what components to prefabricate and thus avoids spending for products which may not be marketable later.

Types of crowdsourced work

  • Procter & Gamble employs more than 9000 scientists and researchers in corporate R&D and still have many problems they can't solve. They now post these on a website called InnoCentive, offering large cash rewards to more than 90,000 'solvers' who make up this network of backyard scientists. P&G also works with NineSigma, YourEncore and Yet2.
  • Amazon Mechanical Turk co-ordinates the use of human intelligence to perform tasks which computers are unable to do.
  • YRUHRN used Amazon Mechanical Turk and other means of crowdsourcing to compile content for a book published just 30 days after the project was started.
  • iStockphoto is a website with over 22,000 amateur photographers who upload and distribute stock photographs. Because it is not burdened by the expenses of a professional organization like Getty Images it is able to sell photos for a lower price. It was recently purchased by Getty Images.
  • Cambrian House applies a crowdsourcing model to identify and develop profitable software ideas. Using a simple voting model, they attempt to find sticky software ideas that can be developed using a combination of internal and crowdsourced skills and effort.
  • A Swarm of Angels is a project to utilize a swarm of subscribers (Angels) to help fund, make, contribute, and distribute, a £1 million feature film using the Internet and all digital technologies. It aims to recruit earlier development community members with the right expertise into paid project members, film crew, and production staff.
  • The Goldcorp Challenge is an example of how a traditional company in the mining industry used a crowdsource to identify likely veins of gold on its Red Lake Property. It was won by Fractal Graphics and Taylor-Wall and Associates of Australia but more importantly identified 110 drilling targets, 50% of which were new to the company.
  • CafePress and Zazzle, customized products marketplaces for consumers to create apparel, posters, cards, stamps, and other products.
  • Marketocracy, to isolating top stock market investors around the world in head to head competition so they can run real mutual funds around these soon-to-be-discovered investment super-stars.
  • Threadless, an internet-based clothing retailer that sells t-shirts which have been designed by and rated by its users.
  • MyChances.net utilizes crowdsourcing to generate admissions information on American and Canadian universities. It uses this data to predict, through statistical processes, the odds a student has of getting accepted to a given school.
  • Public Insight Journalism, A project at American Public Media to cover the news by tapping the collective and specific intelligence of the public. Gets the newsroom beyond the usual sources, uncovers unexpected expertise, stories and new angles.
  • Steve Jackson Games has maintained a large fan community online since 1983, with the inception of the Illuminati BBS. They actively encourage fan pages, and tap the community for playtests, customer feedback, and volunteer product representation (via the MIB program).
  • My-Currency is crowdsourcing home and neighborhood valuation and search (in Alpha for San Francisco as of February 2007).
  • And hundreds more

See also

External links and references

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