The Unbalanced Benefits of Crowdsourcing
I just read a nice article on BusinessWeek – Workers of the World, Innovate – that looked into employee-driven innovation and crowdsourcing.
The article prompted a comment that starts like this:
“I have a real problem with this. Crowdsourcing is heavily biased towards benefiting those who run businesses, but not the idea creators. It cheapens the skill of creative thinking by lowering the cost of obtaining it. Why pay professionals thousands of dollars if you can dangle a carrot worth a $500 bonus?…”
I understand the concern, but I don’t agree with the commentator. If someone figures out different ways of solving problems or creating new opportunities, then what does it help to say that things should be as they have always been (pay someone thousands of dollars rather than paying prizes in a competition).
We can choose to stay in the past or go with the flow. I know what I want to do even though the future brings uncertainty.
The commentator also proposes that we should turn crowdsourcing into an entrepreneurship participation opportunity. I just don’t think it will happen. One reason is that that many of the companies that use crowdsourcing only focus on their benefit. They see this as a one-way tool in which they can get their challenges solved. This value proposition by itself is strong enough to give crowdsourcing future staying power.
This is just fine with me as long as companies do not confuse crowdsourcing with open innovation, which is more in line with the thinking of creating opportunities for many stakeholders in an ecosystem.
Another thing about crowdsourcing is that many companies seem to view this more as a marketing tool than a way to improve on innovation. Crowdsourcing gives companies great opportunities to interact with customers and users. This can make the mouth water on savvy marketing executives that understand the power of social media. Thus the marketing benefits alone are often enough to justify the launch of crowdsourcing initiatives turning real innovation opportunities into a nice side effect.
It would of course be nice if companies can get the best of both worlds and I also think this will happen more often as crowdsourcing matures.
I think that some benefits for the idea submitters could be:
Job opportunity to the best ideas submitters to be able to participate and continue to work on the idea selected the best.
Be part of the first user tests / focus groups on the new product / service when the idea is being developed and ready to launch.
Be the first to get a free product..
Be part of marketing statement or commercial, have your name on it….
Intangible rewards are often much better than tangibles.
I can appreciate both sides of the argument. And I agree crowdsourcing must not be confused with open innovation – I wrote an article on the subject recently. There is a world of difference between Professional Originators and user-based crowd sourcing competitions. Both have a place. However, without an economic structure in place serious particpation in problem solving for corporate firms by professional originators will be restricted – and arguably therefore, so to will innovation per se.
For that purpose a revolutionary new IP protection model for pre-commercialised pre-patent/not-patent concepts has been launched for Professional Originators and anyone seeking to engage them in direct innovation, open innovation or any other means. http://www.creativebarcode.com
As the name implies it is a data-encoded barcode system that denotes the creators and owners of works and their contributions and provides a means to trade ideas and problem solving.
Without a economic model in place – only those earning profits from the end results (and consumers) will benefit. whilst those whose skills, knowledge, time and creativity remains unrewarded. It's time for change http://www.creativebarcode.com/newsitem?item=3
By nature, free market economies move in a direction that eventually matches excess capacity to the need, with the impact of lowering costs for the many. Since the end of the second world war, the global economy has been moving in this direction – hence the migration of manufacturing to China and software development to India, where there is ample supply of labor. Yes, this has had profound negative impact on the some existing businesses, but brings benefit to millions of people who use the products or software created.
Crowdsourcing, in some areas like graphic design and photography, is now further matching excess supply for innovation and problem solving with the need. Yes, this shift will result in pain for some, but benefit for far more. To your point above, one can choose to try to hold onto the past, but it won’t prevent the future.
To your last point about crowdsourcing often being viewed and used by companies more as a marketing tool than as a true innovation tool. I couldn’t agree more, and in fact wrote a recent post about how when companies use crowdsourcing primarily for marketing awareness, they run a higher risk of having it go wrong. http://tiny.cc/gys0i
"Instead of identifying a need that can be applied for good, the program is just another marketing program for the company. "
Surely you jest…what else could it POSSIBLY be when a Rabelaisian "crowd" meets a company needing to SELL ?
Unless you of course believe in magic…"See no Evil, Do no Evil etc. v.s. "Off with their heads" (:>)
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Any “Innovation / Creativity” etc. in package goods or consumer products companies is “controlled” by the Ad Agency, or whatever passes for that today !
It has the ear of the CEO in a very decided and deliberate manner…and yes it is a gatekeeper and… it is not going anywhere!
If you have had even a tiny amount of experience in this domain you know that the “agency will ask “creatives” for a treatise (often for expenses only).
The creatives will kill themselves to provide their “best” and then the agency gives the project (and the creative’s ideas) to someone in the inner circle.
It was like this in 1956 and in 2020 !
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