Appealing to the "crowd" for innovative ideas or for funding was a concept originally intended to help smaller businesses strapped for resources.
But it's also catching on with large enterprises and organizations, including the likes of Proctor & Gamble, American Express, Coca-Cola, Chrysler's Dodge division, IBM and NASA — particularly as a source of feedback and brand engagement.
"About a year ago, the amount that companies were starting to raise started dramatically increasing," says Richard Swart, a former entrepreneur who is director of research on crowdfinance for the University of California in Berkeley and author of a World Bank report about the trend. "We started seeing big companies on Indiegogo. … The common theme is engagement and market awareness. Something that helps align their project with social good, while leveraging crowd wisdom."
The experiments are taking many different shapes, ranging from internal experiments at IBM that incent employees to weigh in on problems or projects across divisions to the registry that Dodge created in 2013 to "fund" new car purchases. Only a few people actually got a car, but the company earned 1 million social media impressions in the process and experienced a spike in quarterly sales.
Estimates from researcher Massolution sized the crowdfunding economy at approximately $5.1 billion in 2013, with projections of almost $90 billion by 2025. You've probably personally received pleas from campaigns on Indiegogo, RocketHub and Kickstarter, but there are literally dozens of other sites that offer a twist on the concept.
While startups may be primarily interested in funds, more established businesses are looking to the crowd as a means of delivering against research or product development goals more quickly, or for gathering or testing new ideas. Reflecting this interest, UC Berkeley plans an executive-level course this fall to help businesses become "crowd-empowered," Swart said.
Actually, It IS Rocket Science
Perhaps the most dramatic demonstration so far of crowdsourced intelligence is the development and engineering challenges run collaboratively by crowdsourcing site Topcoder and the Harvard NASA Tournament Lab.
Topcoder, which is affiliated with cloud integrator Appirio and now includes a community of more than 660,000 data scientists, developers and designers, has been used by more than 700 organizations to pull off projects they otherwise couldn't complete on their own. NASA is using the community for several initiatives.
Here are some examples:
- Asteroid Data Hunter, focused on developing algorithms for validating images captured by ground-based telescopes
- The Disruption Tolerant Network Challenge Series, centered on improving email transmissions between earth and the International Space Station
- Food Intake Tracker, a mobile app for helping astronauts log their diets (with an eye toward thwarting potential nutrition problems)
- Planetary Data Systems Challenge, analytics for researching the rings around Saturn
Narinder Singh, president of Topcoder and co-founder of Appirio, said many of the big companies testing crowdsourced intelligence — including high-tech giants Comcast and Hewlett-Packard — have "an imbalance between their appetite for innovation and their internal capabilities."
Another new challenge starting in September by a group of companies including Booz Allen and BMC Software will encourage developers to build enterprise applications on OS X and iOS using the new Apple Swift programming language. The idea is to accelerate knowledge of the development approach.
New Ways To Gather Internal Knowledge
But crowdsourcing isn't just about looking externally; it's also transforming processes and technologies for capturing and sharing internal knowledge. One example centers on pharmaceutical giant Sanofi, which is using a newfangled feedback gathering tool called Waggl to test strategic "hunches" related to kickstarting innovation without subjecting its employees to "survey fatigue."
"I needed something that looked different, felt different and behaved different," said Claire Derbyshire, head of decision support in Sanofi's UK operation.
Derbyshire and a steering committee have been tasked with suggesting ways in which Sanofi can better use customer insights to drive decisions about new products, projects or services. She used the platform — which allows people to vote anonymously — to test the team's hunches with a larger group of employees, as well as to gather and rank their ideas.
Waggl's approach is minimalistic: it advocates the same "hot or not" sort of voting that defines the well-known crowdfunding platforms. An idea either resonates or it doesn't. What also makes Waggl different from traditional survey tools is the anonymity, said Waggl CEO Michael Papay.
"We want the merit of an idea to stand on its own," he said. "We don't want the CEO's answer to be voted up just because of his or her title."
A similar approach is used by Portal of Pain (PoPin), a service originally created by a technology solution provider Trace3. "The key to this is that you don't want to use it around things that are trivial," said Hayes Drumwright, founder of PoPin and CEO of Trace3. "Almost every employee I've asked wants to be involved with the strategy of their business. This helps you contain, control and curate the feedback."