Point: Dividing work into microtasks and using software to manage quality enables outsourcing of work directly to billions of workers worldwide

Story: One month after launching in Kenya, startup Txteagle Inc became one of the country’s largest employers with a workforce of 10,000 Kenyans. Let’s look at what Txteagle does and the implications for managers and employees worldwide.
In 2008, former MIT Research Scientist Nathan Eagle founded Txteagle (now Jana Mobile), with the idea of marrying crowdsourcing to cellphones.  Txteagle deconstructs work into microtasks that can be performed on any simple mobile phone through texting. Txteagle distributes the microtasks to thousands of workers (currently primarily in Africa) who complete them and get paid via the mobile phone either in airtime minutes or in cash through the M-Pesa service.
“Txteagle is a commercial corporation that enables people to earn small amounts of money on their mobile phones by completing simple tasks for our corporate clients,” says Eagle.
The types of tasks Txteagle’s African workers have done are:
* enter details of local road signs for creating satellite navigation systems
* translate mobile-phone menu functions into the 62 African dialects (for Nokia)
* collect address data for business directories
* fill out surveys for international agencies
Txteagle seems similar to Amazon’s Mechanical Turk, except that workers only need a simple mobile phone – no computer or Internet access is needed. TxtEagle now has partnerships with 220 mobile operators in more than 80 countries.  This expands Txteagle’s reach to 2.1 billion cellphone users in sub-Saharan Africa, Brazil and India, who can all participate as workers. Currently, the firm earns revenues 49 countries.
At first glance, managing 10,000+ workers — not to mention controlling quality — seems daunting. Txteagle solves the problem through algorithms.  “Instead of using managerial staff to oversee accuracy and quality, we use math,” Eagle says. Txteagle’s algorithms infer the correct answer by asking more than one person, Eagle said.  Txteagle also tracks each worker’s accuracy and rewards the best workers. “If they get a lot of right answers in a row, we pay them more for each answer,” Eagle says.

Win/win/win/win for everyone:
For companies in the developed world:
* lowers labor costs through access to a worldwide workforce
* access real-time local expertise in language, business, markets, and conditions
For developed-world workers
* make extra money during downtime
* flextime work
For developing-world workers
* access to work despite local economic conditions
* lets women work remotely
Entrepreneurs everywhere have to opportunity to design work in a new way and not need employees on the payroll in order to get work done.

Action

• Think about the information that ordinary people in foreign markets could collect for your business, such as market  conditions, surveys, local business prospects
• Consider overcoming language hurdles that keep your products from succeeding in diverse economies
• Think about tasks anyone in the world might do during a few minutes to spare
• Imagine how 2.1 billion people could work for you one text at a time

Sources:

Txteagle (now Jana Mobile)

Jessica Vaughn, “Q&A: Nathan Eagle, founder of txteagle,” JWT Intelligence  March 3, 2010 http://www.jwtintelligence.com/2010/03/qa-nathan-eagle-founder-of-txteagle/

Robert Bain, “The power of text in the developing world,”  20 January 2011 http://www.research-live.com/features/the-power-of-text-in-the-developing-world/4004395.article

Kate Greene, “Crowd-Sourcing the World,” MIT Tech Review, Jan 21, 2009 http://www.technologyreview.com/business/21983/

Nathan Eagle presentation at TedxBoulder, August 7, 2010

Point: Solve a ubiquitous problem by using a ubiquitous practice

Story: Four entrepreneurs found a way to generate free electricity in developing nations.  The entrepreneurs – all women who had experience in developing countries – prototyped a soccer ball that “captures and stores energy during normal game play to be used later to charge batteries and LEDs,” said co-creator Jessica Lin. [1]  The soccer ball, called sOccket, generates and stores energy with every kick and bounce. The ball looks like a regular soccer ball, but inside “there’s a magnet that goes back and forth through the inductive coil, which allows a current to be captured in a capacitor and electricity to be stored,” said co-creator Hemali Thakkar. [2] “About 15 minutes of kicking the ball allows us to use a single LED for three hours,” Thakkar said. After kicking the ball around, the person plugs their light, battery pack, cellphone or other small electrical gadget into a DC jack in one of the ball’s panels and enjoys the clean renewable power.  A day of play can become a night of light.

The genius of the idea is that it takes a ubiquitous practice – soccer is the most popular sport in the world, especially in developing countries – and uses it to solve the common problem of the lack of electricity in those countries.  The UN estimates that nearly 80% of people living in the 50 poorest nations have no access to electricity.  By piggybacking electricity production onto the prevailing activity of soccer, the innovation lowers barriers to adoption.  Customers don’t need to change practices to use the product.

The entrepreneurs got the inspiration for their idea from a dance floor in Rotterdam [3] which uses the energy of the dancers’ steps to power the lights.  In the developing world, sOccekt-powered lights would provide an alternative to kerosene lamps, which 1.5 billion [4] people use today as a lighting source.  Kerosene lamps sicken children through respiratory disease (breathing kerosene lamp fumes is the equivalent of smoking 2 packs of cigarettes a day) and produce carbon emissions equivalent to 38 million cars. [5]  In contrast, sOccket produces light from the naturally renewable energy of soccer-players.

The invention, named one of the breakthrough innovations of the year by Popular Mechanics [6] will be distributed in a sustainable way as well. Rather than giving the ball away for free, which would ruin the existing businesses selling soccer balls in developing countries, local entrepreneurs in developing countries will assemble and sell the sOccekt balls themselves. This will help local economies while lowering the cost of the product.

Action:

• Find a common problem or need (e.g., lack of low-pollution lighting)
• Examine common practices or activities of the region/country/customerbase (e.g., soccer)
• Innovate at the intersection of the gap and the existing activity (e.g., energy production from playing soccer) to maximize adoption.
• Look for other ways to enhance adoption by using local resources (e.g., employing local entrepreneurs for manufacturing and distribution)

Sources:
[1] sOccket: Soccer Ball by Day, Light by Night. http://news.discovery.com/tech/soccket-soccer-ball-by-day-light-by-night.html
[2] Electricity Onto the Field http://www.theatlantic.com/technology/archive/2010/11/soccer-ball-brings-off-grid-electricity-onto-the-field/65977/
[3] Partying Helps Power a Dutch Nightclub http://www.nytimes.com/2008/10/24/world/europe/24rotterdam.html?_r=3&scp=1&sq=dance%20club%20electricity&st=cse
[4] Harnessing the Power of Soccer http://www.loe.org/shows/segments.htm?programID=10-P13-00044&segmentID=5
[5] Using Soccer to Supplant Kerosene Use? http://green.blogs.nytimes.com/2010/01/26/using-soccer-to-supplant-kerosene-use/?scp=1&sq=Using%20Soccer%20to%20Supplant%20Kerosene%20Use?&st=cse
[6]The Soccer Ball That Makes Electricity During the Game http://www.popularmechanics.com/technology/engineering/gonzo/soccer-ball-that-makes-electricity-during-the-game

Point: Use open innovation challenges and prizes to inspire solutions, participation and collaboration from employees, partners and customers

Story: In 1919, New York hotel owner Raymond Orteig offered a $25,000 reward to the first person who could fly nonstop from NYC to Paris. Although various people tried, no one won the prize until Charles Lindbergh in 1927. Orteig’s prize, in turn inspired the X PRIZE foundation to offer the Ansari X Prize: a $10 million award in 2004 to the first team from private industry to devise a spacecraft capable of carrying three people 100 kilometers above the earth twice within two weeks. The goal of the prize was to spur private investment and develop a commercial space industry.

Erika Wagner, executive director of the X PRIZE Lab at the Massachusetts Institute of Technology, spoke about how prizes like the X PRIZE are useful to embolden entrepreneurs to take big risks. And, the fact of the substantial prize means that funders and financiers take notice. Ultimately, 26 teams competed for the Ansari X PRIZE and in the six years since the prize was awarded, more than $1.5 billion dollars in public and private funding has gone to support the private spaceflight industry.

Companies from Toyota to Eli Lilly to SAP have run challenges and offered prizes as part of their open innovation efforts through partners like InnoCentive. SCA, for example, a large, international consumer products organization, achieved a return on investment of 74%, with a payback period of less than three months as a result of using InnoCentive Challenges for open innovation in a major R&D division of the organization.

Some of the benefits of prizes are:
• Increasing the number and diversity of the individuals, organizations, and teams that are addressing a particular problem
• Paying only for results
• Attracting more interest and attention to a defined program, activity, or issue of concern (1)

I’ll be sharing more insights about prizes and ideas from the Innovation3 Summit in Orlando Dec 8-10, 2010 in the next post.  For now, here are some action strategies.

Action:

• Word your challenge precisely, around a well-defined problem, to get focused, on-target participation
• Think through all phases of the prize: how will you announce it? How will you determine the winner? How will you follow up to implement the idea?
• Be transparent throughout the process, explaining the criteria for selection of the winners, who will be selecting the winners, announcing and awarding the prize(s), etc.
• Acknowledge all participants, thanking them for their contributions and giving feedback to those who did not win, providing them with information that may help them in future challenges.