White Paper: Before You Begin - Crowdsourcing Best Practices


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Community Engagement. Innovation Management. Voice of the Customer. Crowdsourcing. Whatever you want to call it, communities are forming around companies, ideas, projects, start- ups, nonprofits, and people. These dialogues are happening organically and they’re happening online, which means that the transparency associated with these conversations presents a large variety of challenges and opportunities.

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White Paper: Before You Begin - Crowdsourcing Best Practices

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 There  Is  No  ROI  on  Understanding:           Crowdsourcing  Best  Prac:ces   5  Metrics  to  Develop  and  Consider   Impact   Example  Crowdsourcing  Community  Goals:   Reach   Engagement   Sa:sfac:on   Costs  of  Implementa:on   IdeaScale  and  Innova:on   3   3   4   4   5   6 7   8   Before You Begin
  3. 3. 
 5 Metrics to Develop and Consider Community Engagement. Innovation Management. Voice of the Customer. Crowdsourcing. Whatever you want to call it, communities are forming around companies, ideas, projects, start- ups, nonprofits, and people. These  dialogues  are  happening  organically  and  they’re   happening  online, which means that the transparency associated with these conversations presents a large variety of challenges and opportunities. The title of this piece is “There is No ROI on Understanding.” Which is not to say that community managers and innovation experts shouldn’t try and understand their network, they should. It’s just that for any of these investments to truly pay off, one must respond to those insights. One must take action. Before they begin and in seeing innovation all the way through the idea lifecycle. Industry leaders are finding ways to involve themselves in these discussions and learn from them. Coca-Cola used co-creation to generate a series of ads from their customers and enthusiasts. Companies like Avid ProTools are improving their product based off of feature requests in their customer lab. The new app called Waze uses information from the crowd to generate real-time traffic reports and information. These are, of course, in addition to whole host of other businesses large and small that are implementing programs that invite discussion, ideas, and innovation. Every conversation and community is different, however, and knowing where to begin is oftentimes a daunting process. There are a few important metrics to define early on, however, and they are: • Impact • Reach • Engagement • Satisfaction • Costs of Implementation There Is No ROI on Understanding: Crowdsourcing Best Practices 3BEFORE  YOU  BEGIN
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 “How  do  we  find  the  one  out  of  1,000  ideas  that  is  really   revolutionary  unless  we  go  through  the  torture  of  listening  to  the   4 Impact In Romi Mahajan’s book Cool is For Fools, he introduced a character (and problem) that most people are familiar with: We all have that friend, peer, boss, employee, associate – you know, the guy who always knows how everyone should do everything, how to run every company and every country, the space program, and so on. He’s worse than an armchair quarterback, and even as a Monday morning quarterback, he often loses the game […] Okay, fine, you get it. Arrogant pricks, right? Yeah, well, sure. But here’s the deal: How do we find the one out of 1,000 ideas that is really revolutionary unless we go through the torture of listening to the other 999?1 The most successful communities are places where great  ideas  and  half-­‐baked  ideas   germinate  happily  together and not every great idea arrives on schedule. So how do businesses identify the right ideas? How do they find the great ideas and separate them from the good ones? The most successful companies that implement these programs are those that define their goals early on. Some even organize challenges or campaigns based on those needs, but even those who leave the conversation open need to know what they are looking for. What are the goals? Example Crowdsourcing Community Goals:   • Cost Savings • Revenue Increase • Improving Company Offering • Create Relevant Marketing Content • Reduce Environmental Impact • Improve Regulation Adherence
 *Note: none of these goals is simply “customer/employee/stakeholder understanding.” All of these goals demonstrate a response to improved audience understanding. BEFORE  YOU  BEGIN
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 “When  members  are  rewarded  for  the  impact  or  discussion  or   collaboration  that  their  work  generates,  idea  quality  improves  by  over   5 Every business is different. Every community presents a new field of opportunities. Defining goals early on will help in the assessment process later. One IdeaScale customer launched a feedback community to its restaurant employees in hopes of identifying possible cost-savings solutions. Ideas were rewarded based off of their ability to help meet this goal. One employee made a simple suggestion of replacing ketchup bottles with 2 oz. ramekins filled with ketchup instead. The  idea  was  able  to  save  the  company  $200,000/ year.  A  value  that  was  easy  to  conclude,    because  the  company  knew  what  it  was  looking   for. The employee was rewarded and the company saved thousands. And that was just one idea. IdeaScale also offers an assessment tool that makes it possible for clients to input their goal bottom-lines and evaluate ideas against those goals based on projection. Reach When curating and considering a community, it is important to think of the invisible audience. “a Facebook analysis of top 100 brand pages reveals that for every fan there are an additional 34 friends of fans that can be reached. This multiplier was found to grow even larger when one looked beyond the top 100 brands.”2 This means that when asking a question, setting a challenge, seeking feedback by casting for it out into the lake of ideas, that it’s not just about the voices that you’re hearing, you’re  still  in   conversation  with  and  making  an  impression  on  those  that  are  watching  and  not   participating. It’s like going to a party and telling a story in a large group of ten people. Maybe only two other people dominate the discussion, but everyone goes home and talks about what the party was like. It also means that every person is potentially 34 more people that could have a solution. Bring in a large community. It’s larger than you know. The government issues 8,000 regulations every year and independent government agencies like the FCC operate under the mandate to involve public opinion in any rule-making (so that the government operates democratically and to improve law adoption when the time comes). When  the  FCC  used  the  IdeaScale  tool  to  get  feedback  on  the  National  Broadband  plan,  there BEFORE  YOU  BEGIN
  6. 6. 
 Engagement Innovation  programs  and  engagement  initiatives  are  communities. There should be an opportunity for not just idea suggestions and feedback, but dialogue between members. This means, that you’re not just looking for a community that speaks to you, but speaks to each other. Many community engagement programs offer incentives to contributors, but Professor Olivier Toubia found that the best way to not only improve engagement, but also the quality of the idea, was to offer rewards to members who generated the most participation with their ideas. He called this model the impact model. When  members  are  rewarded  for  the  impact  or  discussion  or  collaboration  that  their  work   generates,  idea  quality  improves  by  over  40%.3   IdeaScale is a system designed around community and dialogue (with the most relevant conversation boiling to the top of the most relevant ideas), but members are also rewarded for their participation in the IdeaScale gamified badge system. There’s even a badge that is automatically awarded to the member whose idea generates the most activity. were  over  60,000  responses  from  the  public,  (the  highest  number  of  Public  Notices  ever   published). As of the writing of this paper, the plan was 88% implemented, a nearly record- breaking pace of adoption for any national plan, perhaps helped along by the voices of both active and passive members that participated in the dialogue. Finally, reach isn’t just about reaching everyone. It’s about reaching an audience that’s relevant to you. If you reach out to your target audience (say: female entrepreneurs between the ages of 25 -50), it is more likely that their networks will include similar audience members rather just putting out a blanket call for engagement to anyone. 6 Innovation programs and engagement initiatives are communities. BEFORE  YOU  BEGIN
  7. 7. 
 7 Satisfaction One of the side benefits of engaging a group of stakeholders (beyond new ideas and fresh insights) is that the  more  a  group  feels  heard,  the  more  likely  they  are  to  feel  good  about  the   organization  that’s  doing  the  listening. For example, only one of five employees feel engaged on the job. And, according to Gallup research, engaged  employees  recommend  their  company’s  products  and  services  78%  of  the  time.4 The same goes for customers or other public communities, the more involved they feel in the process, the more likely they are to feel loyal to the brand and glad to recommend it. In an engagement scenario, people are more likely to feel heard and incorporated when there is good moderation. As the moderator promotes ideas, rewards ideas, reviews ideas, and completes ideas, all of these actions should be celebrated and shared not just for the sake of transparency, but to show the efficacy of participation. When  creating  a  community,  one  cannot   underestimate  the  value  of  a  good  moderator: reward them for actively curating a community. One  researcher  concluded  that  using  the  IdeaScale  tool  to  collect  public  feedback  nearly   doubled  customer  service  sa_sfac_on.5 Satisfied customers mean more recommendation and the growth of a business, even as you learn and grow from those customer insights. Make sure that your moderators are making your community members feel heard. “Engaged  employees  recommend  their  companies  products  and   services  78%  of  the  time.” BEFORE  YOU  BEGIN
  8. 8. 
 8 It’s  easy  to  get  excited  about  a  great  idea.  But  it’s  not  always  easy  to  deliver  on  a  great  idea. One of the most popular examples of crowdsourcing innovation is the Netflix prize in which Netflix asked the community at large to generate an algorithm that would improve the Netflix recommendation engine’s accuracy by 10% in exchange for a $1 Million purse. A few years later, a team met that goal and happily walked away with their check for $1 Million and a sense of a job well done. But the story doesn’t end there, because it turns out that Netflix never implemented the final solution for a number of reasons, stating: “we evaluated some of the new methods offline but the additional accuracy gains that we measured did not seem to justify the engineering effort needed to bring them into a production environment.”6 The market changed for Netflix and so did their priorities and goals and even though the algorithm they purchased was great, they couldn’t make the commitment to implement it in the long run. It is important when selecting and assessing ideas to consider your bottom lines, to understand what it will take to meet the practical applications of innovation and see them though. Conversely, the Veteran’s Association launched their IdeaScale community knowing exactly how much money they had to spend on implementation. Ideas that didn’t fit the scope of the budget had to be shelved for another time. The ideas were filtered from the top 125 to 32 finalists and then the 32 finalists were evaluated against what was feasible. You know your business best. You know what you can afford and what innovations are worth the cost of investment. Costs of Implementation Businesses that use an online tool capable of not just prioritizing ideas and inspiration, but also generating a community around those ideas are the ones that are leading their industry. They are considering engagement, their brand reach, what the costs of innovation are and what the gains of innovation are. IdeaScale has been providing a flexible platform for numerous businesses since 2008. From the beginning the guiding principles have been those of engagement  and  collabora_on. It’s not just a list of ideas, it’s a community around those ideas. These are just a few of the metrics to consider as you help build your community. IdeaScale and Innovation BEFORE  YOU  BEGIN
  9. 9. FOR  MORE  INFORMATION   sales@ideascale.com Global  /  Americas   +1  800-­‐549-­‐9198 New  Zealand   +64-­‐080-­‐099-­‐5088 Australia   +61-­‐02-­‐9037-­‐8414 United  Kingdom   +44-­‐0-­‐808-­‐189-­‐1476 1. Mahajan, Romi. Cool Is For Fools: The Poetry of Marketing. Ascentium Corporation, 2011, p. 86. 2. Swati. "To Expand Your Brand’s Reach on Facebook, Focus on the Friends of Fans." Web log post. BuzzOm. 28 July 2011. Web. 01 Feb. 2012. http:// www.buzzom.com/2011/07/to-expand-your-brands- reach-on-facebook-focus-on-the-friends-of-fans/ 3. Toubia, Olivier. "Idea Generation, Creativity, and Incentives." Marketing Science 25, no. 5 (2006): 411-25 4. Lauper, Elizabeth. “Social Knows: Employee 9 Engagement Statistics.” Social Workplace. 8 August 2011. http://www.thesocialworkplace.com/ 2011/08/08/social-knows-employee-engagement- statistics-august-2011-edition/ 5. Newell, Angela. “Open Government is Dead, Long Live Open Data.” GovLoop. 30 June 2011. http:// www.govloop.com/profiles/blogs/open-government-is- dead-long 6. Amatriain, Xavier. “Netflix Recommendations: Beyond the 5 stars.” The Netflix Tech Blog, 6 April 2012. http://techblog.netflix.com/2012/04/netflix- recommendations-beyond-5-stars.html BEFORE  YOU  BEGIN