Crowdsourcing. By Roy Anderson Summit Ridge Parkway, Suite 401 Duluth, GA (678) (678)

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1 Crowdsourcing By Roy Anderson

2 Crowdsourcing By Roy Anderson The idea of using a pool of people to collect information, generate excitement, and drive change has been with us for ages. The early and effective use of the crowd was to solicit ideas from a wide pool of participants. This broadcast method is used in many ways such as soliciting ideas for new commercials, submitting pictures to create compilation books or designing memorials such as the Vietnam Memorial. Television news rooms use this method in each broadcast as they ask the crowd to submit their pictures and videos in order to capture breaking news. Cereal brands have used the crowd for the past 40 years soliciting from children and adults to create the next character, prizes in the cereal box or new slogans. The early value in the crowd was the sheer number of unique ideas that would come from a large group. The physical attributes of a crowd are seen at every political event, sporting arena, and public demonstration. The ability of the crowd to summon vast resources of talent, that when focused on a single task, can create monumental changes. Examples from the past include the anti-war demonstrations and the civil rights movement where the power of the crowd changed history. In the digital age, on a less historic note, crowds are being asked to participate in the selection of the winners in a number of competition shows such as American Idol and Dancing with the Stars. These examples are not used to demote the crowd but rather to show that the crowd is now being used in all venues, for historic impact as well as for entertainment value. The concept is simple enough; reach out to a large diverse body of opinions and based on their expertise and viewpoint, incorporate multiple modes of easy to use technology, take action, and complete the task. The idea of Crowdsourcing is in fact the application of Open Sourcing principles for work that can be accomplished outside the world of software. In the Open Source model, the crowd may not know each other but can work together, in the online environment, to create complex software where everyone benefits from the global contribution. The developing internet technology has created a solution to allow many skills to now participate in online projects. THE CROWD IS COMING OF AGE Crowdsourcing is coming of age as it moves from sending and collecting ideas and actions from the World Wide Web, to a technology driven resource solution, which provides organized quality output, to meet well defined tasks. These tasks are found throughout the corporation in the form of project plans, department objectives and process charts that incorporate defined tasks. A good project manager has the skills to define the end state, build a project plan that lays out the tasks, resources, timeline and the sequence to reach the end state on time, to specification and on budget. The resources utilized continue to include Page 1

3 associates within the organization, contract workers, outside consultants, and outsourced providers. The crowd, which is a defined pool of capable talent, has now been added to the resource mix that can be employed against the tasks to be completed. The Crowd is a technology enabled virtual workforce that leverages the available talents of at-home workers, college students, freelancers, in-transition and retired workers that have a broad range of skills, to complete tasks to meet business requirements. These workers are found around the globe, are available 24 hours a day, 365 days a year with the ability to expand and contract from one to thousands on a completely variable cost structure. The solution matches supply of talent with demand, encompassing the associated peaks and valleys without the burden of downtime costs, retainers or fixed charges required. Crowdsourcing uses delivered output as the driver of the payment. This refines the payment of work to measurable, delivered tasks which creates a well understood end state cost structure. The program eliminates the need for facilities, utilities, on site supervision, additional benefits, vacation, and sick leave. This process has lower recruiting costs as crowd workers are sourced and screened online with minimal need for outside agencies or in-person interviews. There are also lower termination costs as tasks end, the crowd worker moves on to another task provided within the pooled environment with no closing costs to the original program. The task deliverables can also be measured across a number of criteria to improve the quality, delivery and total cost over time. The development of the task, training and process includes quality checks to confirm the work is being done to specification. As the pool is a known list of individuals, who log into the system, they can be measured for the quality of the work they complete. Poor workers are moved out of the program, quality workers are retained. The system is in a continuous loop of definition, quality improvement, six sigma analysis and improved definition. VALUE TO THE INDIVIDUAL The value to the worker is that they can build on their skills across many companies, spreading the opportunity for work and additional compensation based on their own work output, putting in as much time as fits into their schedule, at the time that works best for them. The task can be done from the comfort of their own home or from any Wi-Fi connected environment, around the world. The labor is compensated based on the skills that are required. Sophisticated and educated people are required to crowd source for highly technical products and services which raises the compensation. This becomes an excellent opportunity for students to build a resume of results, individuals in transition to maintain activity in their specialty or build out new skills, and retired workers have an opportunity to Page 2

4 build a base of revenue. It is clear that this mode of work is not a fit for everyone but it becomes an efficient way to use available talent in support of companies around the world. CROWDSOURCING SOLUTION An enterprise crowdsourcing solution provides the project management, risk mitigation, contracting, and payment mechanisms for enterprises to effectively leverage the skills and capability of the crowd. The opportunity is for the organization to incorporate this solution as an additional resource model along with internal associates, contract workers, temporary staff, consultants, and outsourcing partners. The managed service provider can enable the analysis and provide alternatives that can compare the quality, service, delivery and total cost of each solution. Ultimately it will be a mix of resources that drive the most effective outcome based on the parameters of the project. As with most initiatives that create fundamental changes in work process to improve quality or drive down costs, a mind shift is required to effectively apply Enterprise Crowdsourcing and the MSP can support that change management. Crowdsourcing is based on the development of well-defined tasks that tend to have common characteristics including: - Autonomous Independent tasks with no collaboration or supervision of subordinates required - Algorithmic Tasks can be highly prescribed with clear steps and output - Supportive Tasks provide inputs into business decisions; they don t make them - Dispersed Inherent value in the geographic location/language of the worker EXAMPLES OF CROWDSOURCING - A large manufacturing company that employs thousands of scientists and researchers in corporate R&D and still have many problems they cannot solve. They now post these on a website using tens of thousands of solvers who make up a network of backyard scientists. - A book publisher used Crowdsourcing to compile content for a book published just 30 days after the project was started. - istockphoto is a website with over 22,000 amateur photographers who upload and distribute stock photographs. Because it is not burdened by the expenses of a professional organization is able to sell photos for a lower price. (istockphoto was purchased by Getty Images) - Cambrian House applies a Crowdsourcing model to identify and develop profitable software ideas. Using a simple voting model, they attempt to find sticky software ideas that can be developed using a combination of internal and crowd sourced skills and effort. Page 3

5 - A Swarm of Angels is a project to utilize a swarm of subscribers (Angels) to help fund, make, contribute, and distribute, a 1 million feature film using the Internet and all digital technologies. It aims to recruit earlier development community members with the right expertise into paid project members, film crew, and production staff. - The Goldcorp Challenge is an example of how a traditional company in the mining industry used a crowd source to identify likely veins of gold on its Red Lake Property. The challenge was won by Fractal Graphics and Taylor-Wall and Associates of Australia by identifying 110 drilling targets, 50% of which were new to the company. - Marketocracy, isolating top stock market investors around the world in head to head competition so they can run real mutual funds around these soon-to-be-discovered investment super-stars. - Threadless, an Internet-based clothing retailer that sells t-shirts which have been designed by and rated by its users. - Public Insight Journalism, A project at American Public Media to cover the news by tapping the collective and specific intelligence of the public. Gets the newsroom beyond the usual sources, uncovers unexpected expertise, stories and new angles. - Wired and New Assignment have launched a pro-am collaboration called Assignment Zero that allows citizen journalists to work with professional editors on a story, with the team s research available for re-use. THE NEXT STEP Steps to incorporate Crowdsourcing as a solution requires that we use category intelligence, project management and focus on long term solutions that provide highly compelling businesses cases to attract line of business executives. Engage key stakeholders and suppliers that are thought leaders in the space. Incorporating an approach where a core team of suppliers and internal customers can drive the overall strategy, and highlight high value opportunities. The Business Case needs to tie to the internal customer s pain point. These include: - Ability to hire quality people - Lack of data - Inability to accurately measure the quality of process output - Improve quality - Meet the demands of a dynamic environment - Rising Costs The team needs to be able to provide a holistic cost review that includes: - Labor Rate (competitive to the market) - Skill level to meet the requirement - Demand management(# of hours) - Length of assignment - Downtime between assignments - Startup time (space, log in administration, badging) Page 4

6 GET STARTED To learn how to save up to 30% in crowdsourcing and drive down your contingent labor costs, please contact Roy Anderson at: Phone Crowdsourcing services are provided in collaboration with Lionbridge Enterprise Crowdsourcing About the Author: As Chief Procurement Officer and Vice President of Procurement Services for MetaProcure Roy Anderson collaborates with customers to provide a comprehensive procurement services organization to increase supply chain efficiency and effectiveness. By implementing spend analytics, procure to pay, strategic sourcing, supplier management and category expertise, Roy provides procurement teams with the opportunity to become a strategic partner with internal customers. Roy is the former Chief Procurement Officer of State Street Bank and Vice President of Global Procurement for MetLife. Prior to joining MetLife, he worked as the Director of Purchasing at John Hancock Financial Services. He was also the Director of Purchasing Operations at Fidelity Investments and has worked as Purchasing Manager in commercial and military manufacturing facilities for Textron Corporation and Raytheon Company. He has also built data-driven, high performing global sourcing teams in the US, India, Korea and Mexico. He travels extensively throughout the country, sharing thought leadership with forwardthinking procurement executives who want to move their organizations to the next generation of transformational value. Roy holds a B.S and a MBA from Babson college of Wellesley, Massachusetts. Page 5