Point: Crowdsourcing and open innovation efforts rely on participation.  Attracting participants and encouraging activity is a key success factor in obtaining and vetting new product, service and process innovation ideas.

Story: Crowdsourcing is only as good as the crowd.  Presenters at the World Research Group‘s Innovation Cubed Summit described several methods that they use to engage people for internal innovation efforts.  In particular, they talked about getting participation beyond just idea submission.

Although some innovation contests have an easy-to-score objective measure of success (such as NetFlix’s rating algorithm contest or the get-to-space Ansari X PRIZE), most participatory innovation efforts cast a wider net and have more open-ended, subjective measures of performance.  That means people need to evaluate all the submissions to find the best ones.  These broad innovation contests involve more than just submitting a great idea (the proverbial 1% inspiration).  The effort also requires the 99% perspiration to sort through hundreds or thousands of candidate ideas, score those ideas, and refine the ideas.  Motorola, for example, received 17,000 ideas in their system.  How can companies evaluate ideas?

The solution is to recruit and reward a crowd that helps curate, moderate, vote, and refine ideas even if those participants aren’t idea submitters. Kraft and PepsiCo, for example, emphasized ease-of-use in their efforts at increasing participation.  They make it very simple and intuitive to join the innovation effort, submit ideas, vote, comment, and participate in the effort.  The companies avoid the temptation of asking too many questions and putting approvals barriers on participation.

Real-time recognition also spurs interest and activity.   Both PepsiCo and Motorola post a leaderboard of “Who’s Hot” on their innovation portals.  The up-to-date ranking list enables competitive participants to see their standing at any time.  Timely updates to standings keep people more engaged than if the company ran a “submit-by-the-deadline-and-you won’t-hear-anything-for-a-month” black hole contest.  Game mechanics with well-defined ways of earning points or game currency help increase activity.

Finally, offer a sliding scale of rewards for valuable participation, not just idea submission.  Although some contests focus on rewarding a single big winner with the best idea, several of the companies at the summit sought ways to reward more of the participants in the system.  For example, PepsiCo offers participatory awards for reaching certain point totals.  Both Motorola and PepsiCo had side-contests for high levels of participation, such as “Top Voter” or “Top Point-Getter” in addition to awards for the best ideas.  Approximately 10% of PepsiCo’s 3000 participants reached some sort of award level for their participation in the open innovation efforts.

Action

• Minimize the labor, barriers, or hassles for participation in innovation efforts
• Create a transparent process with clearly-defined expectations and rewards for participation as well as idea submission
• Provide a sliding scale of rewards for all kinds of participation on the innovation process, not just one big prize for one big idea.

For further information: The next World Research Group Open Innovation Summit will be held August 10-12, 2011 in Chicago, IL.

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: Crowdsourcing is maturing beyond its amateur-content and open innovation origins toward core business processes.

Story:

In the beginning, companies used crowdsourcing as part of their open innovation efforts to get new ideas from lead users, customers, and the world at large.  But now, entrepreneurial companies such as Trada and CloudCrowd are moving beyond one-off design efforts and contests (e.g., the Netflix Prize) to encompass routine everyday business processes.  As CloudCrowd CEO Alex Edelstein sees it, “similar to the way Henry Ford’s early assembly lines created a new, more efficient way to complete work, we’ve designed an online process that delivers accurate finished work for even complex projects at a significant savings.”  Let’s look at these two examples.

First, Trada Inc., which recently emerged from stealth mode private beta, offers crowds of pay-per-click experts who create paid-search marketing campaigns.  Each vetted crowd member generates his/her own keywords, ad copy, and deep links to attract prospective pay-per-click customers to the client site.  The result is a much broader span of keywords with less chance of overpaying for over-used common keywords.  By giving access to the long tail of keywords, Trada executes campaigns at lower cost and with greater success than do traditional agencies with in-house employees.

Second, CloudCrowd has 18,000 registered workers who participate in its Labor-as-a-Service business. CloudCrowd’s project managers begin by breaking down a complex task into hundreds or thousands of smaller tasks. These tasks are then passed on to Cloudcrowd’s registered workers. CloudCrowd speeds delivery time and lowers costs in a wide range of BPO (Business Process Outsourcing) applications.  Tasks that CloudCrowd has deconstructed include tracking the University of Southern California’s “lost alumni” and a wide range of web content creation tasks.

Both Trada and CloudCrowd eschew the winner-take-all model of contest-oriented crowdsourcing projects.  Instead, they offer well-defined incremental pay for incremental results.  In the case of Trada, an expert gets paid for each click-through of the ad that the expert created (Trada also offers pay-per-sale crowdsourced campaigns).  CloudCrowd gives its workers a pre-agreed payment for each unit of work they successfully complete.  In CloudCrowd’s case, a worker’s “success” is measured using a system of escalating peer reviews that are also crowdsourced.

Both Trada and CloudCrowd create carefully-cultivated crowds — more like reliable workforces than mobs of transient volunteers of dubious quality.  Trada uses online testing and verified identities to ensure that its experts are really experts.  CloudCrowd assesses each worker’s percentage of correctly-completed tasks to compute a Credibility Rating.  Highly-rated workers gain access to higher-level, higher-paying tasks.

Action

• Evaluate which business processes might benefit from on-going outside expertise or labor
• Create clear tasks and clear rewards
• Create processes to vet or rate prospective crowd members on expertise or quality
• Use the crowd to monitor the crowd

Sources:

Personal interviews with Niel Robertson, CEO, Trada http://trada.com/

and Cloudcrowd (via email) http://www.CloudCrowd.com/