On Outsourcing – Or Crowdsourcing?
By Jack Mixner
After six years of effort, P&G has moved thirty-five percent of its research and development initiatives outside the company effecting productivity gains of sixty percent. iConclude reduced creation of repair flows for customer’s software problems from $2,000 each to just five dollars (Howe, p 183).
A couple things were necessary. Trust of outside developers came first. Then, in almost the same timeframe came suppliers like iConclude which farm out the work to all sorts of experts who may work for minutes or hours as opposed to months or years. The experts bring interest in finding creative solutions to problems outside their normal experience. Companies pay less and get tiny little solutions to huge problems from people with specific expertise in very precise areas.
Howe’s five rules for making it work:
- Make sure you understand what a dispersed crowd may do.
- Work them hard for a short time.
- Look for the specialists.
- Must of the work performed is useless. Look for the diamonds.
- Trust the crowd’s intuition to tell you which solutions make the most sense.
Strategic Implication
You do not have to have total control to succeed. Trust is part of the mix. Communicating with interested supporters and researchers precisely what you need will save time. Ask specific questions.
Reference
Howe, Jeff. The Rise of Crowdsourcing. Wired. June 2006. Page 176.