Open Innovation 2.0 Yearbook 2013 - European Commission - Europa

82 O P E N I N N O V A T I O N 2 0 1 3
3.5. Crowdsourcing in large companies
Introduction
In all the hype around crowdsourcing and open
innovation, we often don’t hear very much about
the possibilities and challenges related to its planning
and implementation within larger organisations
(companies or governments). Change can be
hard for any organisation, but change in a large
organisation where a crowdsourcing or an open
innovation programme is going to impact personnel,
processes and, sometimes, surprisingly large
numbers of stakeholders can be received sometimes
positively but sometimes also negatively. As
such, despite the potential benefits to the organisation,
properly socialising the concept, and defining
a clean change management process is critical for
realising the objectives.
This chapter will seek to answer the following
three key questions that will be of most interest
to large organisations such as corporations and
governments.
1. What can crowdsourcing do for large organisations
and how is it being used for marketing,
product development, human resources, customer
services, etc.?
2. What are some of the challenges large organisations
face when considering and implementing
crowdsourcing activities and how do those differ
from the challenges in smaller organisations?
3. How do you overcome the risk-averse nature of
large organisations when implementing what is
inherently an open process that does not have
the same controls that many other corporate
programmes have?
We shall limit our focus to large companies even
if some of the observations and remarks will be
adaptable to government institutions and nonprofit
organisations.
What is crowdsourcing in 2012?
As the phenomenon matures, the definition varies:
crowdsourcing is one of those concepts that can be
defined in at least two, diverse, ways. On the one
hand, crowdsourcing is an engagement method
whereby organisations (such as brands, companies,
cities and entrepreneurs) seek input from communities
of people. These communities can be open
or closed, homogenous or diverse. Participants are
invited to contribute ideas, solutions, or support in
an open process whereby the elements of creativity,
competition and campaigning are reinforced through
social media to come up with more powerful ideas
or solutions than could be obtained through other
means. ‘Ideation’ is also a term used to describe the
concept or process whereby crowdsourcing is used
especially as part of innovation management.
On the other hand, crowdsourcing can also be
defined as the division of labour by a distributed,
multidimensional workforce (sometimes paid,
sometimes voluntary), motivated to accomplish
a set of tasks that combine to achieve an overall
goal or solve a problem. This motivation can be
financial, reputation-building, joy of participation or
part of being a good citizen of a particular community
(i.e. computer programmers ‘tribe’).
As Boutin wrote [1]: ‘Crowdsourcing is a subset of
what Eric von Hippel calls “user-centred innovation”,
in which manufacturers rely on customers not just
to define their needs, but also to define the products
or enhancements to meet them. But unlike the
bottom-up, ad hoc communities that develop opensource
software or better windsurfing gear, crowdsourced
work in a corporate setting is managed and
owned by a single company that sells the results.’
To paraphrase von Hippel, it relies on would-be customers’
willingness to hand over their ideas (time,
workforce, reputation, credibility) to the company,
either cheaply or for free, in order to see them go
into production for the benefit of themselves and
other customers.
Crowdsourcing in a corporate environment
The development of crowdsourcing can be seen
as running in parallel to cloud computing as both
were driven by the limitations of current business
constructs or technological practices, and certainly
by corporations’ financial ability to keep up with
change happening all around them. Before the
cloud, companies preferred to procure and manage
their own on-site IT infrastructure hardware. When
business was slow, most of a company’s computing
resources (the processing power of its servers and
the memory of its storage devices) would remain
idle or unused. Conversely, the company’s on-site
IT infrastructure would probably be overwhelmed
once business picked up. The main benefits of
a cloud-based IT infrastructure is that it does not
require new hardware purchases and has the flexibility
to scale as required based on demand.
On the other hand, a business that does not use
crowdsourcing will find that they have a challenge
scaling the intellectual and physical capacity of