About Crowd Sourcing and Wisdom Of Crowd
Dated, March 2009
It is half past 10 AM in Bangalore. As usual, I and my colleague HR Bala grabbed a cup of coffee, brisk past the hallways to reach the 3rd Floor Balcony over-looking the sprawling IBM Golf Link campus. It’s indeed, one of the most beautiful places on the corporate campuses in Bangalore – known as the Silicon Valley of India.
It was drizzling outside; cool breeze flew away the hair-thin water droplets back into the sky, and sometimes made to hit on the crystal clear glass walls of the third floor of IBM-GLF-Campus, where the VP-Global delivery sat. Although it made the transparent glasses hazy and the strenuous to the eyes to pass through, but it made the outside atmosphere more serene and extraordinarily beautiful; an exceptionally cool atmosphere for the brains seeking a break.
After a brief conversation, we got back to our desk. IBM had just announced the Values-Jam. Over the next 3 days,
over 320000 IBMers around the world would engage in an open conversation on ‘corporate values’ on the global intranet. Everybody is excited about the new IBM World-Jam (as IBM called it). On 29th July, 2003 IBM is re-defining her 80 year old value system for the decades to come. IBM decided to talk to employees directly, asked what they thought the values of IBM should abided by in its run up to becoming an X billion dollar company. IBMers, by the tens and thousands weighed in. By 11AM next day the portal was bombarded with views and perceptions from Nebraska to Newzealand; from Bangalore to Boston, funneling into the World Jam. They were thoughtful and passionate about the company they are part of. They were also brutally honest. Some of what they wrote was painful to read, because they pointed out all the bureaucratic and dysfunctional things that get in the way of serving clients, working as a team or implementing new ideas. But IBM was determined and committed in keeping the dialog free-flowing and candid. And “I don't think what resulted - broad, enthusiastic, grass-roots consensus - could have been obtained in any other way”, Said Sam Palmisano, the IBM CEO.
over 320000 IBMers around the world would engage in an open conversation on ‘corporate values’ on the global intranet. Everybody is excited about the new IBM World-Jam (as IBM called it). On 29th July, 2003 IBM is re-defining her 80 year old value system for the decades to come. IBM decided to talk to employees directly, asked what they thought the values of IBM should abided by in its run up to becoming an X billion dollar company. IBMers, by the tens and thousands weighed in. By 11AM next day the portal was bombarded with views and perceptions from Nebraska to Newzealand; from Bangalore to Boston, funneling into the World Jam. They were thoughtful and passionate about the company they are part of. They were also brutally honest. Some of what they wrote was painful to read, because they pointed out all the bureaucratic and dysfunctional things that get in the way of serving clients, working as a team or implementing new ideas. But IBM was determined and committed in keeping the dialog free-flowing and candid. And “I don't think what resulted - broad, enthusiastic, grass-roots consensus - could have been obtained in any other way”, Said Sam Palmisano, the IBM CEO.
For me, it was the b
eginning of a realization that the web had changed enormously from what it was in the 90’s to what it’s today. More precisely, the 2nd generation web phenomenon, what’s now called the web 2.0 is happening right under your nose. The beginning of a participative culture getting built over the web. The Facebook, Linkedin and Myspace are the most happening places on the web. Facebook is growing at average of 300%, MySpace at 70% and Linkedin at 40% per month, when I heard last.
eginning of a realization that the web had changed enormously from what it was in the 90’s to what it’s today. More precisely, the 2nd generation web phenomenon, what’s now called the web 2.0 is happening right under your nose. The beginning of a participative culture getting built over the web. The Facebook, Linkedin and Myspace are the most happening places on the web. Facebook is growing at average of 300%, MySpace at 70% and Linkedin at 40% per month, when I heard last.
It stopped drizzling; the sky is bright now and waiting to embrace the clouds. Golfmen are back in the field. From a long distance, I could barely see a newcomer hitting a second ball. Though it went past the fence losing its directional geometry, it did tell the world about the infinite possibilities that the web had opened upto. It also told us, perhaps a lesson, not to search for the ball, as it has already been disappeared in the wilderness. Just the same way you get lost in the web’s wilderness.
Back at my home, I haphazardly turned the pages of the book Wisdom of Cro
wds by James Surowiecki, and I was struck by this revealing paragraph. It read “Everything we think we know about intelligence suggests that the ‘smart’ individuals would offer the most help. And, in fact, the "experts" did okay, offering the right answer—under pressure—almost 65 percent of the time. But they paled in comparison to the audiences. Those random crowds of people with nothing better to do on a weekday afternoon than to sit in a TV studio picked the right answer 91 percent of the time”.
wds by James Surowiecki, and I was struck by this revealing paragraph. It read “Everything we think we know about intelligence suggests that the ‘smart’ individuals would offer the most help. And, in fact, the "experts" did okay, offering the right answer—under pressure—almost 65 percent of the time. But they paled in comparison to the audiences. Those random crowds of people with nothing better to do on a weekday afternoon than to sit in a TV studio picked the right answer 91 percent of the time”.
I’m sure; all of you would have heard, if not seen, "Who Wants to Be a Millionaire?" program on TV. It was a simple show in terms of structure: a contestant was asked multiple-choice questions, which got successively more difficult, and if she answered fifteen questions in a row correctly, she walked away with $1 million. The show's gimmick was that if a contestant got stumped by a question, she could pursue three avenues of assistance. First, s/he could have two of the four multiple-choice answers removed (so she'd have at least a fifty-fifty shot at the right response). Second, s/he could place a call to a friend or relative, a person whom, before the show, she had singled out as one of the smartest people she knew, and ask him or her for the answer. And third, s/he could poll the studio audience, which would immediately cast its votes by computer. And I heard, the crowd was successful 91% of the time while the experts made it just 65%.
That’s just the beginning; producers of everything from animated films to video games are tapping the power of social networks and letting the group do the heavy lifting. Companies have been outsourcing to India and China for years. Now they are taking it to another level by using social networks such as Facebook, MySpace, Second Life, and a multitude of virtual communities to solve their most gnarly business problems. Business model innovation is happening at a lightning clip. First there was outsourcing, then open-sourcing, and now crowdsourcing.
Every business has customers who are sure they could design the products better themselves. So why not let them? Crowdsourcing is the unofficial (but catchy) name of an IT-enabled business trend in which companies get unpaid or low-paid amateurs to design products, create content, even tackle corporate R&D problems in their spare time.
Threadless, is a Chicago-based T-shirt maker whose design process co
nsists entirely of an online contest. Each week the company receives hundreds of submissions from amateur and professional artists. Threadless posts these to its Web site, where anyone who signs up may give each shirt a score. The four to six highest-rated designs each week are put into production, but only after enough customers have pre-ordered the design to ensure it won't be a money-loser.
nsists entirely of an online contest. Each week the company receives hundreds of submissions from amateur and professional artists. Threadless posts these to its Web site, where anyone who signs up may give each shirt a score. The four to six highest-rated designs each week are put into production, but only after enough customers have pre-ordered the design to ensure it won't be a money-loser.
Last year, I came across a site called InnoCentive.com, providing crowdsourcing services to corporate Giants. Now, Boeing, DuPont, and Procter & Gamble, etc. post their most ornery scientific problems on InnoCentive’s Web site; anyone on InnoCentive’s network can take a shot at cracking them.
The companies pay solvers anywhere from $5,000 to $100,000 
per solution. (They also pay InnoCentive a fee to participate.) Jill Panetta, InnoCentive’s chief scientific officer, says more than 30 percent of the problems posted on the site have been cracked, “which is 30 percent more than would have been solved using a traditional, in-house approach.” The solvers at Innocentive are not who you might expect. Many are hobbyists working from their proverbial garage, like this Professor of a University near Jaipur, India who came up with a solution for producing lactic ester “Synthetic route to a lactic acid ester” has already solved a few problems on Innocentive and have been rewarded more than $ 50,000 and she is one among the top problem solvers identified by Innocentive.
per solution. (They also pay InnoCentive a fee to participate.) Jill Panetta, InnoCentive’s chief scientific officer, says more than 30 percent of the problems posted on the site have been cracked, “which is 30 percent more than would have been solved using a traditional, in-house approach.” The solvers at Innocentive are not who you might expect. Many are hobbyists working from their proverbial garage, like this Professor of a University near Jaipur, India who came up with a solution for producing lactic ester “Synthetic route to a lactic acid ester” has already solved a few problems on Innocentive and have been rewarded more than $ 50,000 and she is one among the top problem solvers identified by Innocentive.
Crowdsourcing is a new and nascent business tool for innovation. Used properly, it can generate new ideas, shorten research and development time, cut development costs, and create a direct, emotional connection with customers. Participation is the key. Like IBM that used the same workforce to filter the ideas and shortlist top ones to invest on.
In essence, if innovation is the way to go, crowdsourcing is here to stay; it’s only a matter of time. And the question is not about should we? It’s about how? How shall we enter into this bandwagon and treasure the wisdom of the crowd. Thanks for crowding around this article, and do post your comments.
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