Tuesday, June 14, 2011

About crowdsourcing

First published on June 14, 2011 last updated June 11, 2021. 


See history of the term and concept on Wikipedia.

The practice first appeared as a participatory action that is mediated by the Internet: people got together online to collaborate on some project - ex. open source development.

The term crowdsourcing was first coined in 2005 by Jeff Howe and Mark Robinson, editors at Wired, in a business context, referring to an organization "outsourcing work to the crowd". Outsourcing is externalizing some processes that previously were part of an organization to another organization, which implies a clear boundary between in and out, us and them. Although the outsourcing relation is mutually beneficial, it is not symmetrical. The outsourcee has an information disadvantage and is economically dependent on the outsourcer, cut-off from the market or the customer. Outsourcing can be seen as inter-firm collaboration or synergy. This leads to the notion of supply chains. This form of collaboration has become a key success factor in the global capitalist economy; it has been said that the best companies are the ones that can manage the best supply chains. 

Towards 2008 this phenomena of Internet-mediated sourcing got the attention of academia and Daren C. Brabham wrote the first review paper on the subject. He identified three patterns of crowdsourcing:

  • open collaboration crowdsourcing
  • competition crowdsourcing
  • virtual labor market crowdsourcing

Open and collaboration crowdsourcing is the pattern that stands on the high moral ground. This is what we see in open source software and hardware development, knowledge repositories like Wikipedia, or transaction networks like Bitcoin. Open, in this context, means access to participation as well as transparency. This pattern establishes symmetric relations between participants and a plain field for opportunities and potential development. This is also the pattern used in open value networks.

The other two patterns are at odds with the multitude philosophy, or with the edicts of the p2p economy. 

Competition crowdsourcing is mostly used by companies in need of new ideas. They create a contest between individuals (sometimes organized in groups) and the best idea(s) is rewarded. These contests are usually high adrenaline events that generate a few happy winders and lots of sore losers, while trying to provide a fun experience and enriching experience. I call this type of crowdsourcing "flock milking". Examples: Xprize and the Mio project.

This practice comes from the realization that companies (i.e. closed and hierarchical organizations) can use some of the tools and techniques developed by the open source culture to coordinate a very large number of individuals and extract value from the crowd. The relation remains asymmetrical between the company, a closed, intrinsically individualistic organization and the crowd. In the eyes of the company, the role of the crowd is similar to the role of an outsourcee, although the different nature of the crowd forces the company to modify its practices.

Virtual labor market crowdsourcing is about externalizing low-skills and repetitive tasks, often through an intermediary platform with a market functionality. There, tasks (demand) are matched with skills (offer) and the platform facilitates the transaction and mediates potential disputes. Example: TaskRabit.

In both last cases, the crowdsourcing concept supposes a powerful entity (the outsourcer or the labor market provider), which has some advantage (informational, transactional, logistical, financial, access to market, etc.) over the crowd. The crowd is considered disorganized but resourceful. It is implicitly assumed that this powerful entity is necessary to channel potential out of the crowd, which is seen as incapable of producing a coherent output. For that matter, and for others too, it seams justified for this powerful entity, acting as a center of analysis, coordination and production, to keep the biggest part of the reward/revenues and to reward the crowd just enough. Let's call that the candy economy.

When it comes to motivation, there is a fundamental difference between outsourcing and crowdsourcing. The outsourcer has more influence over the outsourcee than over each individual in the crowd. Moreover, negative incentive doesn't work on the crowd. The outsourcer must become seductive, attractive and must give something in return, something that the crowd likes, which can be a bundle of intangibles (fun, learning experience, networking, exposure, badges, etc.). In some cases the crowd can insist on opening the new information or knowledge that is created during this process, to make it public, which is a form of open innovation that companies have started to appreciate, but not for altruistic reasons. Open innovation unleashed by crowdsourcing, if well conducted, is hyper-innovation, which can better tactic in a very dynamic, innovation-dependent market, as opposed to a defensive tactic based on intellectual property protection.

Structurally speaking, a these two crowdsourcing patterns exhibit a high degree of centralization. 
We cannot ignore the innovation potential of the crowd. Moreover, the crowd is building its production, transactional and distribution capacity. I believe that the last two patterns of crowdsourcing will fade away with the sunset of capitalism.

Sensorica is an example of an open network centered around the individual and its capacity to work in collaboration. Sensorica is not an entity exploiting the crowd, it is the crowd creating solutions for its own problems. It's mode of production is commons-based peer production (Yochai Benkler).

Open source communities don't "source" the crowd, they are the crowd working in collaboration to produce something, one entity, one system. They are not lead by any other entity. They are self-oriented and self-governed entities.

By t!b!   AllOfUs

1 comment:

  1. It would be interesting to hear you comment on the "Arab spring" and how decentralized political movements can arise in networked groups.