Title topic: Collectively creative

The crowd goes professional

Crowdsourcing is developing from a marketing tool into a strategic innovation tool. While this does not make the company’s own development department obsolete, if used correctly it has an immense leverage effect.

Claudia Bardola

A resourceful mother from Castrop-Rauxel invents a toilet brush with a child safety lock, a retired physicist from New Mexico develops an environmentally friendly coating technology and a medical student from Osaka works on a more effective diabetes treatment for a Swiss pharmaceutical company – the research and development departments of companies have not only become global in nature over the past few years but, thanks to total networking, the “wisdom of crowds” can be tapped more and more easily. Through crowdsourcing, companies have access to an almost unlimited global pool of creative individuals who work with or in competition with one another and, in the process, frequently come up with better and, above all, more creative results than the internal development departments.


From a marketing tool to an innovation strategy

Until recently, crowdsourcing was primarily used as a cheap marketing tool: companies called on the crowd to take part in ideas competitions and product reviews or had them filter design proposals. The advantage of this is that companies no longer have to fly completely blind when developing their products and can simultaneously increase customer retention. ;


However, in the meantime, crowdsourcing has reached the next level: “A clear professionalisation can be seen,” says Oliver Gassmann, Professor for Innovation Management and Director of the Institute for Technology Management at the University of St. Gallen. The trend is moving towards more complex questions for which the crowd collaborates as a real problem solver and development partner. Not least in the face of ongoing competitive pressure, more and more companies are opening up their innovation process in this way instead of brooding over their ideas in a quiet room.


Where and who is my crowd?

But even with crowdsourcing 2.0, the principle applies: “If you place abstract problems online with no preparation or strategy, you will receive little or no input,” says Gassmann. This is encouraging the rise of a new industry – knowledge brokers. They lend a hand, for example with designing and formulating the task, collecting, selecting and evaluating the submitted solutions and finding the right group of people in the first place


because whether it’s with laypersons or a select group of experts, open or closed collaboration, selecting the right cloud has a decisive impact on the result.


1/8 Migros is considered to be a Swiss pioneer when it comes to crowdsourcing: the retailer’s customers have already developed more than fifty products via its Migipedia platform. This has already brought in over 40 million francs with retail successes such as mojito syrup and Blévita spelt biscuits with gruyere.

2/8 “Nivea Invisible for Black and White”, which was co-developed by customers, has seen the most successful market launch of a deodorant in the 130-year history of the Beiersdorf group. Users’ knowledge and the expertise of in-house developers are cleverly mixed during the ideas-generation phase, resulting in over four hundred ideas.

3/8 The crowd can also turn against something. The chocolate producer Ritter Sport demonstrated how to master “crowdslapping” with style. When crude suggestions for new chocolate variations appeared on the Internet, the company used its blog to provide a humorous commentary about the fakes, thus taking the wind out of the crowdslappers’ sails.

4/8 Toymaker Lego outsources part of its product development to the fans: users can submit ideas for new kits on the Lego Ideas platform. Anyone who can find a minimum of 10,000 supporters has a good chance of seeing their suggestion end up on shop shelves – as was the case for the “Mini-Big Bang Theory” set, which is based on an American sitcom.

5/8 Industry, too, is slowly getting a taste for crowdsourcing: Bühler, the Uzwil-based plant constructor, asked suppliers and employees worldwide for new ideas as part of an Innovation Challenge. The result is a compact maize mill called Isigayo, which aims to improve food security in rural Africa.

6/8 Don’t mess with the Crowd – the Town Council of Schwäbisch Gmünd went against this principle and snubbed one of the crowd’s decisions: thousands of people had voted online to name the new tunnel in the town after Bud Spencer. In spite of this, the town council called it the Einhorn Tunnel but they did name the open-air swimming pool after the hero of cowboy films and former elite swimmer.

7/8 Brilliant shape for an ice scoop, novel teaspoon strainer, space-saving multiple socket and the variable cake cover – coffee roaster and retailer Tchibo has its Tchibo Ideas online platform to cream off the best flashes of inspiration from its community and brings them to shop shelves.

8/8 Creativity of the crowd against genetic engineering: last year the environmental organisation Greenpeace appealed to designers and graphic artists from all over the world to design campaign motifs to dissuade the beef burger giant McDonald’s from using genetically modified food. A total of just under one thousand entries were received. “Flashing the finger” is one of the winning ideas.

1/8 Migros is considered to be a Swiss pioneer when it comes to crowdsourcing: the retailer’s customers have already developed more than fifty products via its Migipedia platform. This has already brought in over 40 million francs with retail successes such as mojito syrup and Blévita spelt biscuits with gruyere.

The range of crowdsourcing platforms is also large and diverse these days. “We have observed that these are increasingly specialised, for example in individual process steps, skills or industries,” notes Gassmann, and predicts: “In the future, these could evolve into central business ecosystems that cover all links in the value-creation chain: from ideas generation and creation to financing and marketing.”


The ideas platforms that have already been around for some time, such as Jovoto or the Swiss Atizo, are now being joined by research and development platforms like TecScout, Ninesigma or InnoCentive, which network companies with hundreds of thousands of scientists. Meanwhile, on Crowdspring and 99design, for example, marketeers and designers offer their creativity for sale, and even highly specialised industries are now working together with the crowd. For example, on Skipso you can find knowledgeable people and companies from the Cleantech field, and the Medical Valley Innovation platform connects more than 180 medical technology companies with a total of more than 16,000 employees, 18 universities and 22 research institutes.


Community-based crowdsourcing is also very popular. Those who have a reputed name and enough manpower establish their own platform with their own crowd. For example, Tchibo Ideas, Ideas4Unilever and My Starbucks Idea tap the valuable creative performance of their fan base. Here in Switzerland, Migros stands out in particular as a pioneer: on its Migipedia platform, consumers have already created more than 50 new products, bringing in around 40 million francs.


In general, a number of companies in Switzerland have already gained experience with crowdsourcing is Gassmann’s analysis: “But there is still significant potential that needs to be identified.” Here, it is remarkable that the gap between the crowdsourcing pioneers and those who avoid it is becoming ever wider: “Companies with a strong innovation culture and open employees, in particular, are opening themselves up to crowdsourcing. Less innovative companies, on the other hand, do not accept ideas from external sources and, metaphorically speaking, prefer to reinvent the wheel. In this way, crowdsourcing facilitates the principle of St. Matthew: Whoever has will be given more.”

«Companies with a strong innovation culture and open employees, in particular, are opening themselves up to crowdsourcing.»

Oliver Gassmann, Professor of Innovation Management at the University of St. Gallen

Employees form a crowd

A second trend: large enterprises above all are realising that the longer the chain, the more possibilities for using the collective intelligence of the company’s own employees. In this way, the boundaries between departments can be lifted, existing ideas made visible and developed further by as many people as possible.


This approach is also useful for Swisscom when it comes to its internal feedback tool Flux: with this tool, employees can easily and quickly load their prototypes onto the platform in visual form and ask colleagues for their opinions. It makes no difference whether this is a digital or physical product, an app, a campaign or a website. The person asking the question simply has to select who should give their opinion: their own team, experts such as designers, technicians or sales employees or the entire Flux community, which has more than 1,500 employees and a good 100 different job profiles. The tool automates the posing of the question and the delivery, and then provides a meaningful evaluation within 24 hours. “This is extremely efficient,” explains project manager Michael Baeriswyl, and adds: “Previously, companies developed a project for a number of years and then launched it onto the market once it was complete. This simply doesn’t work anymore today. The ever shorter product cycles require ideas to be tested increasingly early and quickly. However, the necessary access to customers or expertise is often unavailable and then expensive market researchers get involved.”


Flux is therefore based on speed, simplicity and perfect usability. The feedback process takes less than five minutes. “It should work the same way as in a physical shop: take a quick look at a product and form an opinion,” says Baeriswyl. This is well received among the employees: on average, every prototype receives feedback 100 times in 24 hours. In the meantime, Flux has become so popular within Swisscom that the tool will be available as a version for purchase and software as a service (SaaS) as of the end of the year.


Pitfalls with all varieties

A study by the German Chamber of Industry and Commerce also showed that crowdsourcing is worthwhile. According to this, development times can be reduced by up to 42% and costs cut by up to 20%. However, such successes do not occur by themselves and all varieties involve any number of pitfalls, as Gassmann knows from practical experience: “Often opportunities and risks are not given enough consideration when publishing a question. It is important to bear in mind that if Hilti, for example, advertises a project publically, its competitor Würth will follow it closely, and vice versa. Patent topics are also frequently carelessly overlooked. A public discussion can quickly have a negative impact on subsequent patentability.”


The selection of the most suitable incentive system is also crucial, as this varies depending on the crowd: for example, various projects have shown that rewarding a broad crowd with money can destroy the entire project as the participants feel as though they are being misused as cheap labour. Here, it is more effective to use gamification elements like rankings or to issue exclusive prototypes. On the other hand, professional idea generators are hardly prepared to work for free. On expert platforms, they are also increasingly rewarded with a share in the profits. In the future, such incentive systems will expand and professionalise the innovator communities even more.


Gassmann views raising awareness among the employees as a key internal success factor: “Often, crowdsourcing is still seen as a replacement for innovation rather than a knowledge accelerator that can move your own groups forward. However, if a company manages to implement the right approach, this generates immense leverage effects for the company’s own innovative strength.”


How much crowd?

Crowdsourcing is part of the open-innovation paradigm, in which companies open up their innovation processes to external groups and involve customers, suppliers, universities and experts in the value-creation process in an interactive manner. Crowdsourcing defines the outsourcing of work processes, creative processes and other processes to the masses – usually via the Internet.

The varieties include, for example, micro- or clickworking, in which easy mini-tasks that can be performed electronically, such as indexing or categorising images, are outsourced to the masses for an extremely small fee. In the case of crowdtesting, which is becoming increasingly popular, the community performs software tests, and with co-creation, companies work on product development together with their customers or employees from different departments. Crowdvoting, on the other hand, involves putting something to a vote – anything from product and design ideas to political questions. Crowd donation refers to the web-based collection of donations. Crowdfunding is a web-supported form of financing that is provided by the masses – usually in return for a reward such as property or rights. In contrast, with Crowdlending, the community gives dedicated loans to companies.

Further reading:

Large collection of news and videos in English on the topic of crowdsourcing Overview of numerous crowdsourcing platforms

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