CROWDSTORM THE FUTURE OF INNOVATION, IDEAS AND PROBLEM SOLVING

Background and Context

Crowdsourcing is the term most often used to describe how organizations work with large groups to
achieve any number of ends. Crowdstorming is essentially sourcing ideas and getting feedback on ideas
from large groups of people outside of the organization.

Crowds in todays world, powered by new devices, user interfaces and better looking platforms enable
organizations to use the abundant talent outside of their organizations to generate ideas and feedback

Firms Before Crowds and Crowds in Context























There is a clear shift in functioning of firms from traditionally being organized as stand-alone units to
more collaborative work environment that involves not only people within the organization, but also
broader communities.

Complimenting/Changing Existing Models
Some examples of firms implementing crowd-based environments to compliment or change their
existing business models
i.) GE Ecomagination To speed to innovation in developing new power grid technologies, GE
came up with a 10-week idea-generation contest known as Ecomagination in partnership
with technology firm Brightideas. The contest resulted in over 3,800 ideas, 80,000
comments and 120,000 votes. The ideas were evaluated by GE subject matter experts and
resulted in commercial partnerships of GE with 22 startups in a broad spectrum of
technologies

Traditional Firms Crowd-enabled Firms
Employees
Broadcast Media
Financial Institutions
Individual Ownership
Data Samples
Labor
Influence
Capital
Assets
Data

- Open Innovation, Cocreation, Microtasks
- Sharing, Commenting, Reviewing
- Crowd-funding, Crowd-lending
- Collaborative Consumption
- Big Data, Collective Intelligence,
Analytics, Algorithms
ii.) Lego Cuusoo Toy giant LEGO launched a project in 2011 named cuusoo (meaning wish in
Japanese) to find and evaluate new ideas for LEGO products. Anyone can submit and
promote their ideas on the Cuusoo website. After an idea gathers 10,000 or more votes,
LEGO reviews the idea. If the idea matches certain production, pricing and design guidelines,
it is put to production and royalties are shared with the idea owner. A good example of this
is the Minecraft games

iii.) P&G The company that was 90% internally focused on getting new product ideas, moved
from a 90-10 internal-to-external ratio in sourcing product ideas (innovation) to 50-50,
resulting in increased product throughput

iv.) CEMEX In 2010, the construction materials company CEMEX deployed SHIFT, a new
platform to encourage intra-company collaboration to develop new products and reduce
time-to-market. This required transforming internally from a company with independent
global operations to a more tightly integrated global company across languages, cultures
and modes of problem solving. They achieved Crowdstorming across company by creating
an innovation team to generate awareness, make participation attractive and easy with
relevant training and advocating success stories to create an experience. The result was
moving from a core group of 2,000 people in 2010 to over 13,000 active users across
countries in 2012

Some other successful examples of Crowdstorming include Threadless, TaskRabbit, Giffgaff, IDOE, Elance
among many others


Crowdstorming Failures
i) Mountain Dew In 2012,Mountain Dew came out with a contest named Dub the Dew to
come up with the best alternative name(s) of the drink. The result was a list of top 10 (by
votes) not-so-nice names, including Diabeetus as a potential new name




The key is to ask the right questions and direct the campaigns/contests to the right audience.
Careful planning is important.

Some other failed Crowdstorming projects include prizes.org that provided a tool with no guidance
at all; and NASA ISS Module that resulted in the name Colbert (the name of an American
comedian) as the best name for a new room at the international space station

Brainstorming to Crowdstorming
Crowdstorming is essentially using the brainstorm workflows coupled with low-transaction costs to
result in increased participation of people outside of an organization. Crowdstorming is therefore
brainstorming at a much larger scale to find more ideas, insights and feedback

Brainstorm Workflows + Low Transaction Costs = Crowdstorming

Crowdstorming projects can be identified into one of the following three broad categories
i.) Search Contests and challenges that are focused on looking for the best idea/s (or
partner/s). It involves sourcing new ideas and picking the best ones per the companys
discretion and requirements. Examples include X Prize or DARPA

ii.) Collaborative This approach relies not only on generating new ideas but also encouraging
getting feedback on existing ideas. This results in a drastic increase in the number of
participants and also involves the outside-talent-pool in determining the best idea(s).
Examples include LEGO Cuusoo that helps generate ideas for product extensions as well,
and GE Ecomagination

iii.) Integrated This approach involves increased participation in giving feedback, and also
assigns a value to each feedback contribution. The idea behind this approach is to not only
be able to select the best idea(s) but also improve upon it. Usually, feedbacks are rewarded
based on the value assigned to them. Examples of companies using this approach include
Quirky that pays out shares of revenue to participants in its design process; Jovoto that
awards karma; Giffgaff that has payback points and OpenIDEO that uses a design quotient

Crowdstorming as a process
Crowdstorming is about Asking the right question i.e. deciding what you are solving for and who are
your best audience. What should be asked and to whom a virtual community or issuing a Request-for-
Proposal.

This is followed by a Call to Action. The characteristics of good Calls to Action include focusing on the
right outcomes (what are you looking to do), right detail, level of complexity, concept maturity, clear
evaluation criteria and right story and vision to inspire external talent to participate. It involves a funnel
approach starting from the desired outcomes and moving to the right set of participants











Crowdstorming starts and ends with Meta, which means starting with an idea and then focusing on
smaller parts of that idea. Crowdstorming involves the following four iterative steps as a process
1.) Planning (Problem)
a. Protecting intellectual property, confidentiality and brands
b. Asking the right questions
c. Deciding on fair incentives to motivate the crowd

2.) Organizing (Social Creative Process)
a. Building the coalition
b. Recruiting the participants

3.) Executing (Ideas & Evaluation)
a. Managing communities to facilitate great outcomes
b. Understanding participant contributions
c. Evaluating ideas

4.) Meta (Solution and break-up ideas)
a. Feedback and using ideas for product extensions


Case Starbucks Coffee
In 2010, Starbucks realized that they were generating huge wastes to the extent of over 2,000 paper-
cups from one local store being thrown out a day and decided to reduce the waste. They approached
not only municipal governments, material suppliers and cup manufacturers, but also environmentally
conscious individuals for the problem.

In association with several partners, Starbucks ran a contest with cash incentives to get ideas on
reducing the waste. At the end of the contest, Starbucks came out with a better quality of paper cups
that could be recycled, and a chalkboard that recorded the number of times each cup was recycled. For
every tenth time a paper-cup was recycled and used, the coffee was given free. This resulted in
The Call to Action
(External
Talent)
increased awareness about environment protection and cast Starbucks as an environmentally conscious
company.

The Crowdstorming model followed by Starbucks can be summed as





Audience Questions
Q 1.) How is Crowdsourcing different from Social Production?
While both involve using the experience of a community or large groups of people to obtain ideas or
content, Crowdsourcing is usually based on a market mechanism and has a kind of intermediary or
broker involved in the process such as an agency or team

Q 2.) What is the difference between Social Intelligence vs. Collective Intelligence?
While both are about knowledge or ideas that emerge collectively from a group, social intelligence is
more explicit and directed towards a particular topic or question such as Quora and Wikipedia that are
user contributions on specific topics.
Collective intelligence is more implicit and used to derive indirect information such as reviews and
amazon sellers. These give information about the type of users, their preferences etc

Q 3.) How large does a crowd have to be for Crowdstorming?
There is usually a 1-9-90 rule in Crowdstorming i.e. for every one idea, there are likely to be 9 votes,
reviews or feedback and another 90 observers. So the larger the crowd, more the ideas and feedback
are going to be.