Crowdsourcing, Globalization and the Information Age

Mar 12, 2012

CIOUpdate Contributor

by Rob Vandenberg of Lingotek

More and more companies are choosing crowdsourcing as a way to outsource and innovate. From big corporations like Kraft Foods to sole proprietorships, companies are accessing software platforms to capture ideas and labor from an anonymous collection of people who can collectively accomplish a task. Whether it be R&D or Web design, crowdsourcing often generates quality results more quickly and at a lower cost than in-house alternatives.

Crowdsourcing holds numerous benefits, as proven by its viral adoption across companies and industries. Perhaps the biggest advantage is that crowdsourcing can effectively replace employees, making it a less expensive way to accomplish a task. The crowd also diminishes the time commitment associated with finding and vetting labor. Crowdwork is often done in a competitive setting, enabling the best talent and most clever solution surface quickly and with little effort on the company’s part. Instead of launching a search for the best global talent, companies tap into a massive talent pool that comes to them.

Because of the number of people involved, a crowd generally encompasses  a more diverse knowledge base and skill set, leading to creative and unexpected solutions. A crowd can generate a greater variety of solutions and innovations for a company to choose from. Not only can companies build the products that best suit their needs, they can build a pipeline of innovations by harvesting the many ideas generated in a crowdsourced project.

With crowdsourcing and open innovation -- a similar process in which companies consult with a designated crowd of people rather than launching an open call to the public -- companies can also outsource important functions such as R&D, innovation and design while saving money and increasing efficiency. As an example, personal products company Kimberly-Clark, used open innovation to decrease the time it takes to launch new products by 30 percent, according to Editor Paul Sloane’s A Guide to Open Innovation and Crowdsourcing. Problem solving and bringing products to market almost become just-in-time, on-demand propositions empowering companies to keep up with the breakneck pace of business today.

Crowdsourcing and competitive advantage

The crowd is a powerful tool for companies wanting to thrive in today’s fast-paced global business environment. Business is moving more quickly than ever before and is ignorant of time zones. Companies face losing market share if they don’t keep pace with their competitors, who may be international or multinational.

Companies need to globalize more quickly and in a more networked, efficient manner. Because crowdsourcing can quicken the pace of everything from manufacturing optimization to video marketing, it is a powerful tool for any business penetrating a new market.

Localization is another ingrained benefit. A business can crowdsource functions that require localization, such as customer support and product design, to a crowd located in a global target market. The crowd of that country will automatically create products and services that fit local culture. For example, if a company crowdsources the design of a product it wants to launch in Singapore to a crowd of Malaysians, the product will gain built-in local flavor that will automatically suit the cultural preferences of the target market. Companies save time and energy trying to figure out the tastes of their target market. Moreover, if the community is aware that it is crowdsourcing for a specific company, that company can gain brand recognition and affinity within that community.

Create the right crowdsourcing environment

Crowdsourcing isn’t without its risks, however. The Facebook Turkey localization fiasco is a prime example. Facebook crowdsourced the translation of its user interface into Turkish. A swarm of anonymous translators took it upon themselves to imbue the UI with X-rated error messages and dirty words.

To ensure successful crowdsourcing projects, companies need to create an environment that encourages quality. The solution is to provide incentives and stay engaged with the crowd. Incentives could include:

  • Rewards;
  • Contests;
  • The advancement of individuals within the crowd;
  • Achievement milestones; and
  • Community events.

Individuals in the crowd need to feel engaged and like they’re part of the solution, otherwise companies risk skewed or even mutinous results. Other techniques to ensure engagement include:

  • Setting clear objectives for each crowdsourced project, so results stay on-target.
  • Engaging with participants during the course of the project, to ensure motivation.
  • Giving participants clearly-defined and achievable tasks, to prevent burnout.

Crowdsourcing is becoming an increasingly crucial component of successful globalization. The speed, quality and creativity provided by crowds is taking the pace of globalization to a new and interdependent level. Understanding why to crowdsource and how to do it right is poised to become one of the major competitive advantages of today’s businesses.  

Rob Vandenberg is President and CEO of Lingotek, a provider of translation services to global companies. Prior to being named CEO, Vandenberg served as the company's vice president of Sales and Marketing. Prior to Lingotek, Rob was one of the first 20 U.S. employees at Intershop Communications where he helped build its worldwide business and helped make the Intershop IPO one of the most successful enterprise software company IPOs in U.S. history - ($10B market cap). Later, Rob co-founded and served as the CEO of LocalVoice, which was acquired by HarrisConnect in 2005. Rob received a bachelor's degree in political economics from UC Berkeley.

Tags: R&D, crowdsourcing, LingoTek, Kraft Foods, Kimberley-Clark, open innovation,

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