Crowdsourcing – The way of the future?

crowdsoursing,

Will R&D departments be replaced by crowdsourcing? Or at least partly? A problem solved is a problem halved, the old saying goes. But what happens when you share a problem with an abundance of people instead of just a few colleagues?

Research and development is usually regarded as top secret and fiercely guarded against prying eyes. However that seems to be changing a bit due to the increased use of crowdsourcing, which allows you to tap into a much wider pool of knowledge and specialist skills.

Reach out to experts you don’t know

The idea behind crowdsourcing is to harvest both internal and external knowledge to solve problems by reaching out to capable people outside your company and regular network. And more and more companies post challenges on web sites and offer a reward to anyone who can solve it.

Get some of the brainiest people in the world competing to solve your problem

A good exampel of such a web site is InnoCentive. It has a network of about 200,000 of the brainiest people in the world that will be able to look at your problem from an objective point of view. The rewards are substantial and to get $50,000 for solving a problem is normal.

A tool for industrial espionage?

Needless to say there are voices are raised against crowdsourcing in particular when it comes to security and the dangers of industrial espionage. InnoCentive believes it has solved that by being responsible for the IP process by making both the source that posts the problem and the sources that solve them anonymous to start with.

Money saver as well as new job market

Crowdsourcing is becoming increasingly popular and new sites are appearing on a continuous basis which seem to indicate that companies are increasingly regarding it as an efficient way of handling innovation. R&D is extremely expensive and by out sourcing, at least part of it, to freelancing scientists not only saves a lot of money but also give companies access to some of the best brains in the world. It’s also interesting to note that it is creating a new job market for the intelligentsia of the world where they can pick and chose what they want to work with.

Goldcorp struck gold

One good example is that of the Canadian mining company Goldcorp, which was struggling financially and unable to find gold on its land in northern Ontario.

When a new chief executive arrived he put all its geological data online, asked for help on where the gold was located and put up $500,000 in prize money for accurate suggestions.

“They got submissions from people all over the world, including people using 3D computer modelling techniques. They found $3bn worth of gold on the property and Goldcorp became one of Canada’s largest mining companies.”

Secrecy versus solutions

Where would Goldcorp be today if secrecy had been more important to them than solving the problem? Crowdsourcing actually enables small and medium sized companies, as well as individuals for that matter, to have an R&D department comprising some of the best brains in the world. With worms like Stuxnet around is it actually possible to keep anything secret nowadays? Unless of course you don’t in any way involve computers in R&D (you don’t even have to post it online for Stuxnet to get access to it).

Useful tool for governments?

And governments are starting to use it as well. It can be particularly useful when there are difficult decisions to be made, such as where the axe must fall in terms of cutting public spending. Critics on the other hand, say it has been proved that crowd sourcing for governments gets out of hand and becomes a tool for lobbyists.

Crowdsourcing in your personal life

Are you using crowdsourcing to solve your own problems? You can actually do so even as a private person. Networks such as Globe Forum allows you to post your problems to their global pool of networks and instantly have a team of experts collaborating to solve your challenge.

What are your feelings about crowdsourcing? Do you believe it’s the way of the future? Or is safety more important to you than a solution? Will crowdsourcing enable small and medium sized companies to better compete with the giants? Do you already use, or plan to use, crowdsourcing?

Picture: Steve Johnson

92 thoughts on “Crowdsourcing – The way of the future?

  1. Sounds sensible,we need to break traditional mold business organisational models.Tapping into external sources, remunerating them on a success or order participatory basis can surely generate more value.
    How you manage these resources are separate and sometimes complicated issues but these should not override the value concept.

      1. yes, crowdsourcing does provide solutions to small companies with less resource the possiblity to compete with big business. But many people stop getting interested in participating in crowdsourcing because of the contest reward application. At blurGroup we do crowdsource but we don't ask the solution provider to give it all up in a competition rather we gather the best problem solvers have them pitch themselves and allow the seeker to choose among them Of course we crowdsource creative solutions, websites, marketing social media not scientific questions.

  2. Perhaps I'm old fashioned, but I don't dig crowd sourcing. I think it devalues what people do (most people won't earn 500k), but I think it will become more popular in the coming years. I think this economy has created new ways for people to get what they want and this is one example. But I do think that when it comes to social issues and things of that nature, this can be a great tool.

    1. Dennis how much you earn from crowd sourcing depends on what you do. Look at how much Goldcorp paid. But obviously only top brains will earn that kind of money, most people will not.

      However, if you look upon it from a business point of view it enables small and medium sized companies to get access to the kind of problem solvers the giants have. That to me is an interesting aspect that can enable entrepreneurs to develop their company faster and better than they would be able to if crowd sourcing wasn't around.

  3. Catarina,

    Very interesting. This sounds like it could be a cost effective way to get ideas from many people that are outside of the traditional R&D process. It could also be a great form of publicity in some cases.

    Chris

  4. Crowd Sourcing in our personal lives? I think it would work only in formalized setting such as "Globe Forum" which you mentioned, and which I intend to check out! Without a formal setting, I find that many (most?) individuals are unwilling to share their expertise without being compensated either monetarily or with an expectation of returned services. With these paramaters in place, where there is a "I'll scratch your back if you scratch mine" mentality, then I see crowd sourcing working beautifully. Reminds me of the saying "It takes a village".

    1. Good points Keyuri. People expect rewards and what Goldcorp did is a good example. With crowd sourcing they compete to get rewards of $50,000 or so. Crowd sourcing is different from members of say, Linkedin, trying to get us to do work for them for free.

  5. Catarina.

    One might suggest that Linkedin is a fine example of crowdsourcing, but with a smaller, more select crowd.

    Slim

    1. Slim, Linkedin is not crowd sourcing. A good exampel is a web site called InnoCentive. It has a network of about 200,000 of the brainiest people in the world that will be able to look at your problem from an objective point of view. The rewards are substantial and to get $50,000 for solving a problem is normal.

      Linkedin on the other hand is a huge social media network with about 70 million members.

      If your company has a problem that you believe could be solved by crowd sourcing I suggest you use a site like InnoCentive and get 200,000 of the best brains in the world to solve it for you. Then you, like Goldcorp, may just stike gold.

  6. I think crowd sourcing is a viable option for certain business, especially if using a company like InnoCentive and I do like the way they protect the seeker's identity.

    Having worked with R&D, sometimes when they are having issues with a new idea or problem the market opportunity can be missed. It could also save a lot of time and money getting the assistance instead of hoping R&D will crack the problem someday.

  7. Catarina, very interesting post. I think what Slim meant was that the concept behind crowd sourcing is similar to the activity on Linkedin in that people seek advice from those they network with in an effort to share ideas.

    I think crowd sourcing can be a very viable and potentially profitable route for the small and medium sized companies like you suggested. A way to compete with their giant counterparts and have access to the same pool of brainiacs can definitely give the little guy an edge.

    1. Glad we agree about crowd sourcing Julie.

      On Linkedin you can get new ideas and opinions. But Linkedin members are not going to invest a long time and effort solving your problem without payment. Besides on Linkedin you are not anonymous. Unless of course you are a one of the members with fake name and details.

  8. CLOUD SOURCING is in fact so BRILLIANT IDEA ….that no big discussion is called for to use it as a TOOL ….

    I would suggest a Good cloud sourcing on ' The Dangers of Cloud Sourcing ' WOULD HELP in creating FIR E WALLS while using this tool

    VIJAY DONGARE,PUNE INDIA

  9. I think the topic of croudsourcing is fascinating. I thought I share a recent discussion on ethics related to crowdsourcing.

    Whitla (2009) stated the following unethical issues when engaging in crowdsourcing:
    * Organizations replace highly qualified and paid staff with cheaper external people; and
    * The low payment made to the winning participants versus the benefits gained by organization from using the idea.

    The following evidence highlights crowdsourcing as ethical:
    *Notably, so far there has not been evidence that suggests that participants are forced to partake in crowdsourcing (Whitla, 2009). Furthermore, Franke & Klausberger (2008) academic research proved that the crowd is only concerned with the fairness of the crowdsourcing process followed by the organization rather than personal economic benefits. There is no documented evidence in relation to any of the process being done unfairly; and
    *An example that reflects that crowdsourcing is not unethical is InnoCentive.Com. The participant is made aware of the terms and condition when registering to be solver. One of the terms says, “InnoCentive shall retain all ownership in the Site and all content generated by it that is displayed on the Site”. The participant chooses to go ahead and participate even though is aware of this term. This clause in the terms and conditions supports that crowdsourcing is not necessarily unethical.

    I look forward to everyone's comments.

    1. If high paid experts are replaced by lower paid crowdsourcing, its because their expertise no longer holds the relative value it used to thanks to direct communications capability between businesses and consumers and scientists. however, at thesame time scientists will be able to access funding through new connectivity to philanthropy and the public through connectivity as well and that will at some point change the dynamic. if science no longer requires business to fund it or experts to decide what gets funded for r and d, we could well see a reversal of market science control. imagine a world where the scientists are funded directly by the public and license their inventions to businesses wanting to use it and willing to a) pay the price for the license and b) willing to adhere to the terms of use set by the scientist / funders / public. the world would be a different place, I think.

  10. An interesting post, Catarina. I've not really thought about crowd-sourcing in this context but can see it makes a lot of sense…

    I think companies are increasingly using [elements of] it to improve service and products, but as you illustrate, this can go so much further.

  11. Catarina, Crowd sourcing is a new term to me but it’s certainly not a new concept. I have to admit that I was unaware of sites like InnoCentive and OneBillionMinds. It never ceases to amaze me how technology has changed the way we collaborate. Thanks for another enlightening post. I learned something new today.

  12. The low payment made to the winning participants versus the benefits gained by organization from using the idea. Simply that would be the best happened to the people who will be participated a certain organization.

  13. Hi Catarina: I enjoyed this post.

    As a freelance writer, I use "crowd sourcing" all the time. We have listservs in our writer's associations on which members post questions pertaining to their search for clients and their ideas for writing projects. If we chose to work in secrecy, and be suspicious of the motives of our fellow members, we would not have the wonderful resource of sharing to help with our marketing and professional efforts. I'm for sharing all the way.

  14. Catarina,

    Awesome post. Crowd sourcing is indeed a splendid idea and it can work wonders for businesses (I have heard about news companies using it to collect news and others using it as a way to get things done quick and cheap – like the concept of fiverr taken to a mobile level).

    I think that crowd sourcing is a great idea because you essentially have a large list of people from which you can choose the most suitable for your job (I think that's the biggest benefit). And like you said, saving money is also one among the most important benefits.

    My recent post You Certainly Need To Procrastinate!

  15. Caterina — very enlightening post. I wasn't aware of InnoCentive or One Billion Minds. Always something new to learn. I think crowd sourcing is an extension of brainstorming (which is mentioned on InnoCentive's site) taken to a new level. Instead of brainstorming in a room with maybe 6-12 people, you are brainstorming with thousands. I think you can get a lot of ideas from crowd sourcing. But be aware that the people you are sourcing don't have all the facts. The people who have all the facts — and ideas from crowd sourcing — are the ones who have to make the final decisions and they may or may not reflect the majority view of the crowd.
    My recent post TED on Employee Engagement: “No result matches your query”

  16. I found this very informative and enlightening. The biggest challenge we face in this, ever changing and fast paced world, is what to trust and what is worth the time and energy to pursue. Crowd Sourcing could offer a way the help with the "time and energy" part of the equation if you can get past the fear of what and whom to trust. Thanks for this. It gives me food for thought regarding how I might solve some challenges in my new business.
    My recent post Judge A Book By Its Cover?

  17. Excellent post as usual Catarina…crowd sourcing has helped people in my network solve some of the most pressing problems…as well as assisted them in finding funding which was crucial to their projects survival…it allows everyone to become involved whether you are a friend, family, neighbour or just a passing stranger…which is all kind of awesome!

  18. I have a bit of mixed feelings when it comes to crowdsourcing. I dont beleive that every new product development should be exposed to the world, internal crowdsourcing is better for that (unless the project is topsecret like some of the stuff is at apple hq).

    As for small development issues, marketingpurposes, its great. However I think that having a great network of leadusers in your industry can provide more value depending on the problem that needs to be solved. I read a paper once about Colgate who had a problem to fill fluor into their tubes (looks like flour), they crowdsourced for a solution and saved alot of money – that was a simple process engineering problem, so its not dangerous for the organization to share.
    My recent post What Does Ethanol Fireplaces Cost?

  19. Interesting topic.

    The example; Goldcorpis, is very clear, but is it not more about finding something than to actually solve a problem? Maybe it's more a kind of application of "wisdom of the crowd" (Sir Francis Galton)

    As it is, I understand that those who leave suggestions for a problem-solving, are kept apart; anonymity. If you could combine the 'right' people, we could get great things done. I think much of the solution to any problem is to pursue cooperation.

  20. I've never used crowd sourcing for myself. And I don't recall even donating to any requests. But because I've seen some that are getting sometimes a million dollars or more I HAVE to believe, these are working. While I'm not sure of the follow-up – like do they people who donate ever find out their funds were put to good use? Does the requester thank the early adopters in some way? But there are some of the craziest things that boggle me in terms of the dollars/money they get. Like recently my son pointed me to Bunch O Balloons: 100 Water Balloons in Less Than 1 Minute on KickStarter. WILD! Yes; I think it is a wave but pleasant or tsunami, I'm waiting to assess.
    My recent post Bad drama and good stories for introverts to navigate

      1. Yes of course. I forgot to transition to my comparison. Sorry. That thought train got derailed. If crowd sourcing is like crowd funding I think it will be more of a trend (not a fad) in the future. They each depend on "crowds" to either harvest the best ideas or raise money. Both are essential for being competitive.
        My recent post Bad drama and good stories for introverts to navigate

  21. This is quite timely as crowd sourcing has become a very viable option for self-published authors to complete projects that they need funding for….like cover design, interior formatting, conversion to ebook format and editorial help. This is the first I have heard of it's industrial use! Thinking back to my manufacturing days,I'm not so sure it would have worked in my industry of food service equipment. Patents were always being challenged as so many products has such close similarities and I might worry about pirating:) On the other side, some of our best ideas for marketing came from people outside of our industry. Are there crowd-sourcing opportunities for marketing rather than development?

    1. What you talk about in the beginning is crowdfunding, Jacqueline. Am sure you can find crowdsourcing for marketing ideas. Go and check out the sites for crowdsourcing. Development is definitely being crowdsourced.

  22. In an ideal world crowdsourcing sounds like an incredible and viable idea. My concern however would be those issues you raise but also that, as we all know, there are plenty of folks on the internet proporting to be experts but are not. A solution from this source could simply mean the beginning of other problems within your organization or personal life.

    1. Yes, there are pros and cons, Tim. If you crowdsourced for a solution in your company, would you really be as gullible as to fall for a fraudster? Having said that when it comes to personal life, though, the risk is higher.:-)

  23. I have no experience with crowd sourcing but it could be a terrific resource for small companies. I hate the idea of personnel being replaced by it though. It sounds a lot like having the best brains present at your brainstorming session. I read all the possible drawbacks that you mentioned and of course there is always the possibility of problems when something goes public. From my limited knowledge, I think it could be a great way to find solutions.

  24. I've been on both ends of the crowdsourcing rope! I have worked on Amazon's mTurk and Appen Butler-Hill for more than 2 years, and I have just started using mTurk to crowdsource tasks that I don't have time to complete myself. It's a fine line to walk. As a worker, I have seen the dark side – employers that crowdsource jobs then refuse to pay, employers that don't pay enough, workers that try to automate the process and ruin it for other workers. Because I've been on that end I think I am a pretty fair employer when I crowdsource my work. 🙂 It's very cost and time efficient, and most crowdsourcing sites allow the employer to pre-screen and choose which workers are allowed to perform their work.

  25. Great post Catarina. This issue was a conundrum for me for a while. It all seemed like a great idea until I came across a crowd sourcing project that was related to creating glow in the dark plants. No real consideration was given to environmental impact, or ethical oversight because the project had no real institutional affiliation. However, imagine pursuing that project without any commentary at all and out of the public eye. The beauty of crowd sourcing is that it is NOT secretive. 🙂
    My recent post The Edge

  26. This is really interesting Catarina. Never heard of InnoCentive. (Maybe because I don't qualify as one of the 200,000 brainiest people in the world.)

  27. This was, and still is, very interesting to me. Among the many challenges we face everyday, one of the biggest is who and what to trust. We spend a lot of time sucking energy trying to determine that. Crowd Sourcing could offer a resource to help with that. It certainly gives us some food for thought. 🙂

    My recent post Easy Herb Butters: #Recipe

    1. Yes, Susan it's an interesting issue isn't it. Getting access to top experts online instead of just your colleagues could be a step forward, provided security isn't compromised.

  28. I can definitely see the potential for many businesses. Believe it or not, crowdsourcing is also becoming more and more popular for authors as a way to test their works in process. I’m all for having critique partners, beta readers, and even hiring an editor of my own when the time comes, but I can’t ever see myself putting my work out there like that.

  29. Crowdsourcing is an interesting phenomenon. I have mixed feelings about it. I think it can be a great way to bring great minds to a tough problem. But I also see the potential for businesses to try and get something for nothing and possibly short-change their own employees.
    My recent post Manitoba Lake Life

  30. Great informative post as always. I have seen people engaging in crowd sourcing without knowing its name so informative post. The key with the technique is to protect one's interests while drawing from others to solve a problem. The Goldcorp example is great, but they would have had claims secured first to ensure that the help would benefit them more than anyone else who may jump their claims. So this technique needs to be used with care. I would use it selectively though.

  31. Although I am not new to the concept I have not heard of those specific groups. I think crowd sourcing done right is a good thing. I have seen it used by authors very successfully. Like with any tool, use it wisely.
    My recent post Wearing Glasses is Cool… Now

  32. The Goldcorp story is impressive. Companies really have to get over their history of veiling their product development in secrecy. In a technology driven economy any good idea that goes to market gets replicated quickly anyway.

  33. Great topic! I use crowd sourcing in a smaller scale. In Facebook, I am a part of several groups of similar likes and we ask each other questions. It has helped a great deal with getting my issues answered for my website, blog, and service offerings. The trick is to find a group large enough and active enough to help answer the questions quickly. To make it quicker, I offer to give them free links on my site if I use their suggestions. It works pretty well for me as a small business owner and helps me not feel alone.

  34. In some ways crowdsourcing is just a new twist on networking, particularly within professional organizations. Using it as tool for a company’s research is a new approach, however, and it will be interesting to see how the trend develops – whether it becomes a common way of R&D or fades out.

    1. Kind of Donna. But a huge difference is that you frequently have to disclose confidential information in order to succeed. Most likely crowdsoucing will grow like everything that's carried out online.

  35. Crowd sourcing is a new concept to me. What a remarkable tale about Goldcorp. Where would they be today?

    If a company has the money to recruit people to bring in their expertise – why not?

    1. Crowdsourcing is definitely going to increase. A positive aspect is that you don't need to recruit people to get their expertise. You just pay the person that solves your problem.

  36. Crowdsourcing could be one of the biggest achievements we have recently made. The benefits you mentioned, cost, more and smarter people working on the issue, could be the next biggest advancement in business and technology. However, as great as it could be, I could still see many companies and organizations remain in the old culture. They will try to keep their results, and knowledge secret from others. I have seen this in government, individual IT staff refusing to share information, or doing what the can to keep their results a secret.
    I just hope eventually, companies will see the benefits outweigh any objection they have to crowdsourcing.

  37. Hello Catarina, I have been thinking and researching on Crowdfunding sites. As I am looking for either crowd fund or find an angle investor for expansion of one of my companies. Thanks for the information.

  38. I find this fascinating. Knowing who to trust is a constant worry, and takes up a lot of our time. Crowd Sourcing could offer a resource to help with this. It's definitely something to consider.

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