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Stakes, limits and opportunities, how to take advantage of the crowdsourcing to offer a strong value proposition to your customers?

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Coined by Jeff Howe, the term Crowdsourcing – a composite of Crowd and Outsourcing, describes outsourcing to the crowd. Afar from cost, advantages and opportunities for a company can be considerable. …

Coined by Jeff Howe, the term Crowdsourcing – a composite of Crowd and Outsourcing, describes outsourcing to the crowd. Afar from cost, advantages and opportunities for a company can be considerable. It can outsource the risk of failure and it only pays for products or services that meet its expectations. This phenomenon covers various situations. Seeking to mobilize external competencies, it has interested a large number of businesses. However, this concept has reach its maturity and its limits seem to be pointed out as bad from professionals of different industries. Crowdsourcing is lacking a general and synthetic view of this concept. The purpose of our paper is to characterize Crowdsourcing in its various aspects. First we describe of Crowdsourcing, and offer examples illustrating the diversity of Crowdsourcing typology, practices, business models and we present comparisons between Crowdsourcing and established theories (Open Innovation, User Innovation).
Relying upon a group of persons (crowd) can be an adequate method, because of its unique characteristics that are made possible by the Internet.
Crowdsourcing offers extraordinary potential for resolving tasks efficiently by tapping into the skills of large groups of people. To illustrate so, we explain how Capseo, a crowdsourcing based company, works with freelancers from around the world to make online marketing campaigns.

Finally, we present some potential benefits and pitfalls of Crowdsourcing and explain how to bypass its obstacles to offer a strong value proposition to customers.

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  • 1.   “Stakes,  limits  and  opportunities,  how  to   take  advantage  of  the  crowdsourcing  to   offer  a  strong  value  proposition  to  your   customers?”     The  Case  of  DOZ   Carine  Esteves                   Thesis  submitted  for  completion  of  Master  of  e-­‐Business  Innovation     Idrac  Business  School   Lyon,  2013        
  • 2.   INTRODUCTION   5   1.   LITTERATURE  REVIEW   1.1.   Understanding  Main  Concept   1.1.1.   Definition   1.2.   Business  Model  Typology   1.2.1.   Quantitative  crowdsourcing:   1.2.2.   Qualitative  crowdsourcing:   1.2.3.   Innovation   1.2.4.   Open  Innovation   1.2.5.   User  innovation   1.3.   Formulating  Hypothesis   1.3.1.   Traditional  In-­‐House  management,  as  a  stand-­‐alone  strategy,  is  no  longer  enough   1.3.2.   Crowdsourcing,  is  an  effective  business  model  for  any  type  of  business   1.3.3.   Crowdsourcing  guarantees  quality  work.   1.3.4.   Crowdsourcing,  is  suitable  for  any  type  of  business   1.3.5.   Every  task  can  be  crowdsourced.   7   7   15   15   15   20   21   23   26   26   26   27   28   29   2.   RESEARCH  METHODOLOGY   2.1.   Introduction   2.2.   Methodology  Selection   2.2.1.   Qualitative  research   2.2.2.   Presentation  of  the  Case  Study   2.2.3.   Data  collection   2.2.4.   Problem  definition   2.2.5.   Research  Objectives   30   30   30   31   32   33   34   3.   FIELDWORK   3.1.   Capseo   3.1.1.   What  does  Capseo?   3.1.2.   Customers   3.1.3.   Influencers/Suppliers   3.1.4.   Different  roles   3.1.5.   Capseo  Crowdsourced  System   3.1.6.   Industry  Analysis  Summary   3.1.7.   Capseo  new  vision   35   35   35   35   35   36   37   39   43   4.   VERIFYING  HYPOTHESIS   4.1.   Traditional  In-­‐House  management,  as  a  stand-­‐alone  strategy,  is  no  longer  enough   4.2.   Crowdsourcing,  is  an  effective  business  model  for  any  type  of  business   4.3.   Crowdsourcing  guarantees  quality  work   4.4.   Crowdsourcing,  is  suitable  for  any  type  of  business   4.5.   Every  task  can  be  crowd  sourced   46   46   48   50   53   53   5.   RECOMMENDATIONS   5.1.   Prosourcing  platform   5.1.1.   Advantages  of  Prosourcing   5.1.2.   Starting  the  Prosourcing  Trend   5.2.   CONCLUSION   58   59   60   62   63   6.   CONCLUSION   65   7.   APPENDIX   66   8.   BIBLIOGRAPHY.   69     7   30   2  
  • 3.   TABLE  OF  ILLUSTRATION       Figure  1  :  Outsourcing  Vs  Crowdsourcing   Figure  2:  Store  Model   Figure  3:  Request-­‐to-­‐Proposal  Model   Figure  4  :  Data  Model   Figure  5:  Collaborative  (Peer)  Model   Figure  6:  Closed  Innovation   Figure  7:  Crowdsourcing,  Open  Innovation,  User  Innovation  and  Open  Source   Figure  8:  Open  Innovation   Figure  9:  The  four  ways  to  collaborate   Figure  10:  Crowdsourcing  Industry  Revenue  Growth   Figure  11:  Scheme  of  Capseo's  Organization   Figure  12:  Traditional  Organizational  Structure   Figure  13:  Prosourcing  System   Figure  14:  Prosourcing  Difference   Figure  15:  Prosourcing         8   16   17   18   19   20   21   22   24   28   36   46   59   61   63     3  
  • 4. ABSTRACT     Coined   by   Jeff   Howe,   the   term   Crowdsourcing   –   a   composite   of   Crowd   and   Outsourcing,   describes   outsourcing   to   the   crowd.   Afar   from   cost,   advantages   and   opportunities  for  a  company  can  be  considerable.  It  can  outsource  the  risk  of  failure  and   it   only   pays   for   products   or   services   that   meet   its   expectations.   This   phenomenon   covers  various  situations.  Seeking  to  mobilize  external  competencies,  it  has  interested  a   large  number  of  businesses.  However,  this  concept  has  reach  its  maturity  and  its  limits   seem  to  be  pointed  out  as  bad  from  professionals  of  different  industries.  Crowdsourcing   is  lacking  a  general  and  synthetic  view  of  this  concept.  The  purpose  of  our  paper  is  to   characterize  Crowdsourcing  in  its  various  aspects.  First  we  describe  of  Crowdsourcing,   and   offer   examples   illustrating   the   diversity   of   Crowdsourcing   typology,   practices,   business  models  and  we  present  comparisons  between  Crowdsourcing  and  established   theories  (Open  Innovation,  User  Innovation).     Relying   upon   a   group   of   persons   (crowd)   can   be   an   adequate   method,   because   of   its   unique  characteristics  that  are  made  possible  by  the  Internet.     Crowdsourcing   offers   extraordinary   potential   for   resolving   tasks   efficiently   by   tapping   into   the   skills   of   large   groups   of   people.   To   illustrate   so,   we   explain   how   Capseo,   a   crowdsourcing  based  company,  works  with  freelancers  from  around  the  world  to  make   online  marketing  campaigns.       Finally,   we   present   some   potential   benefits   and   pitfalls   of   Crowdsourcing   and   explain   how  to  bypass  its  obstacles  to  offer  a  strong  value  proposition  to  customers.             Key   Words:   Crowdsourcing,   Collaborative   Innovation,   Open   Innovation,   Web   2.0,   problem  solving,  co-­‐creativity       4  
  • 5. INTRODUCTION       Crowdsourcing  is  a  neologism  for  a  business  model  in  which  a  company  or  institution   takes  a  job  traditionally  performed  by  a  designated  agent  (usually  an  employee)  and   outsources  it  to  an  undefined,  generally  large  group  of  people  in  the  form  of  an  open   call.  (Howe,  2006).   Crowdsourcing   is   a   disruptive   business   model   where   customer   engagement   with   a   company  is  at  a  much  higher  level  than  seen  in  any  previous  business  model.  This  level   of  consumer  interaction  makes  it  vulnerable  to  malicious  behavior.    It  brings  out  several   major   concerns   that,   for   a   better   understanding   of   how   companies   can   leverage   crowdsourcing,   need   to   be   discussed   and   analyzed.   Evaluating   and   understanding   the   key   challenges   and   the   stakes   of   this   new   disruptive   business   model   is   necessary   to   avoid  its  pitfalls  and  take  advantages  of  its  benefits.   Crowdsourcing’s  impact  can  be  seen  by  observing  the  numerous  successful  examples  of   crowdsourcing   startups   and   large   old   economy   companies.   Even   thought   it’s   not   a   technology,   many   utilize   this   technique   to   harness   the   ‘wisdom   of   the   crowds’.   From   conventional   business   to   new   business   to   innovate,   differentiate   and   compete.     However,   new   businesses   render   this   principle   insufficient   and   in   some   cases   even   completely  inappropriate.     In   an   era   when   great   ideas   can   emerge   from   anywhere   in   the   world   and   IT   has   considerably  reduced  the  cost  to  getting  access  to  it,  it  is  now  very  usual  that  virtually   companies  shouldn’t’  innovate  on  their  own.     With   the   facility   of   accessing   new   technology,   potential   partners   and   ways   to   collaborate  with  them  have  both  expanded  considerably.  However,  greater  choice  has   made   the   choice   of   the   best   management   options   much   more   difficult.   Should   companies   share   intellectual   property   with   a   community?   Should   it   foster   collaborative   relationships   with   a   few   partners,   wisely   selected?   Should   it   harness   the   “wisdom   of   crowds”?     There  is  no  great  approach  to  leveraging  the  power  of  outsiders  unless  the  companies     5  
  • 6. consider  each  aspect  around  open  models  of  collaboration  such  as  crowdsourcing,  and   accept   the   fact   that   choosing   a   different   mode   of   collaboration   involves   different   strategic  trade-­‐offs.  Picking  the  wrong  model  could  cause  falling  behind  in  the  constant   race  to  develop  new  technologies,  designs,  products,  and  services.   Too   often   the   growing   eagerness   of   companies’   not   withstanding   to   crowdsoucing   makes   them   jump   into   relationships   before   even   analyzing   if   their   structure   and   organizing  principles.  Considering,  how  open  or  closed  a  firm’s  network  of  collaborators   should  be?   This   paper   was   developed   to   give   a   simple   framework   to   help   firms   make   decisions   about   the   type   of   collaboration   to   adopt   by   first   going   over   all   type   of   existing   crowdsourcing  business  models.     This   analysis   review   together   with   an   in-­‐depth   study   of   Capseo’s   business   type   brought   out   a   few   issues   on   how   crowdsourcing   is   perceived   by   both   unconcerned   people   and   involved   actors   of   crowdsourcing.   First   quality   control   seams   to   one   of   the   biggest   issues   for   crowdsourcing   and   the   reliability   of   the   crowd   recruited   comes   in   second   position.   Also,   considering   different   aspects   of   a   business,   like   its   organization,   partnership   possibilities   will   differ   considerably   in   the   degree   to   which   membership   is   open   to   anyone   who   wants   to   join.   So,   given   a   business’s   strategy   how   should   it   decide   which  problems  the  crowd  will  tackle  and  which  solutions  could  be  adopted?   The  final  purpose  was  to  explore  what  were  the  options  available  for  Capseo  to  set  up  to   take   advantages   of   what   is   best   from   crowdsourcing   and   improve,   or   rather,   remove   what  is  are  limits  of  it.       And   begin   to   investigate   what   Anji   Ismail,   Capseo’s   SEO,   coined   as   “prosourcing”   options  that  can  improve  the  quality  of  a  “crowd  workforce”.           6  
  • 7. 1.  LITTERATURE  REVIEW       1.1. Understanding  Main  Concept       By  analyzing  and  extracting  common  elements  we  will  first  establish  a  unified  definition   of   the   term   crowdsourcing   and   the   basic   characteristics   of   crowdsourcing   initiatives.   Based  on  existing  definitions,  an  exhaustive  and  consistent  definition  for  crowdsourcing   will  be  presented  and  contrasted  in  different  cases.     1.1.1. Definition       The   name   crowdsourcing   is   formed   from   two   words,   crowd,   making   reference   to   the   people   who   participate   in   the   initiatives,   and   the   word   sourcing,   which   refers   to   a   number  of  procurement  practices  aimed  at  finding,  evaluating,  and  engaging  suppliers   of  goods  and  services.  It  is  a  recent  concept  with  blurring  definitions.       In  this  usage  the  term  crowd,  refers  to  any  group  of  people,  from  corporation,  group  of   researchers   to   the   entire   general   public,   which   itself   does   not   have   to   be   cohesive.   A   group   of   people   answering   questions   on   Quora.com   (Quora   is   a   question-­‐and-­‐answer   website  created,  edited  and  organized  by  its  community  of  users,  wikipedia.com)  may   not   know   each   other   outside   of   that   website,   or   a   group   of   people   betting   on   a   football   game  may  not  know  each  others’  bets,  but  nevertheless  they  form  a  crowd  under  this   definition.     Commonly,   and   mistakenly,   associated   to   any   type   of   Internet-­‐based   collaborative   activity,  such  as  co-­‐creation,  open  innovation  or  user  innovation,  the  existing  definitions   vary   from   an   author   to   the   other.   “Some   authors   present   certain   specific   examples   of   crowdsourcing   as   paradigmatic,   while   others   present   the   same   examples   as   the   opposite”  (Estellés-­‐Arolas  &  Gonzales-­‐Ladron-­‐de-­‐Guevera,  2012)         7  
  • 8. Crowdsourcing   is   a   form   of   outsourcing   not   directed   to   other   companies   but   to   the   crowd  through  an  open  call  mostly  via  an  Internet  platform.     Surowiecki   (2004),   Nambissan   and   Sawhney   (2007)   state   that   the   said   crowd   can   be   defined  as  a  large  set  of  anonymous  individuals.     Figure  1  :  Outsourcing  Vs  Crowdsourcing     Source  :  Schenk  E.  and  C.  Guittard  (2009).     There   has   been   discussion   around   whether   or   not   the   term   “crowdsourcing”   came   from   Jeff  Howe,  a  contributing  editor  at  Wired  Magazine.  He  was  supposedly  the  first  to  coin   the   term   but   in   fact   Jeff   Howe   credits   Steve   Jurvetson   with   the   term   from   an   earlier  post  on  flick.  See  Appendix  [1]       Regardless   of   Jeff   Howe’s   deferred   credit,   he   posted   the   first   real   definition   of   "crowdsourcing"   in   a   companion   blog   post   to   Wired   magazine   in   June   2006   “the   Rise   of   Crowdsourcing”.         8    
  • 9. This  short  definition  of  the  term  would  be  as  follows:     “Crowdsourcing  is  the  act  of  taking  a  job  traditionally  performed  by  a  designated   agent   (usually   an   employee)   and   outsourcing   it   to   an   undefined,   generally   large   group  of  people  in  the  form  of  an  open  call.”       While   some   might   depend   upon   active   collaboration   within   a   virtual   community   of   individuals,   others   might   benefit   from   the   opposite.   Howe   goes   deeper   into   the   definition.   According   to   him   there   are   multiple   approaches   to   crowdsourcing.    In   his   book   “The   power   of   Crowd”   J.   Howe   breaks   crowdsourcing   into   four   primary   types,   laying   out   examples   of   how   businesses   can   tailor   crowdsourcing   to   each   of   their   own   circumstances.       In   the   first   type,   wisdom   of   crowd   companies   asks   people   inside   and   outside   the   company   to   help   solve   problems   and   suggest   new   products.   The   second   type,   crowd   creation  is  used  by  businesses  to  create  content  such  as  news  segments  and  video  ads.   People   voting   for   their   favorite   photography   or   product   design   at   apparel   maker’s   website,   thereby   illustrates   crowd   voting   and   finally   startups   use   the   last   model,   crowdfunding  to  raise  money  and  fund  microloans  to  individuals.  These  for  types  will  be   outlined   afterwards.   We   will   go   from   Open   Innovation   to   User   Innovation,   which   are   used   in   different   ways   by   different   authors.   Also   each   type   of   crowd-­‐sourcing   will   leads   us   to   questioning   ourselves   about   the   difference   between:   Crowdsourcing,   Co-­‐Creation   and  Collective  Intelligence:  some  might  use  these  terms  as  opposite  while  others  treat   them  as  synonyms  of  crowdsourcing.       1.1.1.1. Crowd  Wisdom     For   Paul   Sloane   it   is   “simply   gathering   ideas   from   the   crowd”.   Basically   this   concept   refers   to   “the   process   of   taking   into   account   the   collective   opinion   of   a   group   of   individuals  rather  than  a  single  expert  to  answer  a  question.”  (Surowiecki,  2004)         9  
  • 10. First  approached  by  Howe,  this  process  in  the  business  world  was  then  approached  in   detail  by  Suroweiski  in  his  book  the  “Wisdom  of  Crowds”.  It  is  attempt  to  harness  many   people’s  knowledge  in  order  to  solve  problems  or  predict  future  outcomes  or  help  direct   corporate  strategy.         Social   information   sites   such   as   Wikipedia,   Yahoo!   Answers,   Quora   and   other   web   resources  that  rely  on  human  opinion,  have  pushed  crowd  Wisdom  into  the  mainstream   spotlight.  (Baase,  2008)     The  most  famous  example  of  company  using  the  Crowd-­‐  Wisdom  is:     • Innocentive  –  Connects  research  organizations  with  a  global  community  of  scientists   It   is   common   to   reciprocally   use   the   terms   “Collective   Intelligence”   and   “Wisdom   of   Crowd.  Buecheler,  Sieg,  Fuchsil  &  Pfeifer,  2010’s  publications  the  terms  have  been  used   interchangeably  for  “using  a  large  group  of  individuals  to  solve  a  specified  problem  or   collect  useful  ideas.”  However  there  is  real  difference  between  those  two  terms.       Collective  intelligence       The   term   collective   intelligence   is   credited   to  Pierre   Lévy  in   his   book,   dated   of   1994,   “L’Intelligence   collective.   Pour   une   anthropologie   du   cyberspace”.   MIT   C.I.   Center   gives   a   general   but   simple   and   clear   definition   “collective   intelligence   makes   reference   to   groups  of  individuals  doing  things  collectively  that  seem  intelligent.”     E.  Estellés,  in  its  article  “Crowdsourcing  and  Collective  Intelligence”  dated  of  April  2012,   clarifies  the  relationship  between  both  terms  giving  8  elements  that  should  be  meet  for   something  to  be  qualified  as  Crowdsourcing:           1. Crowd  (the  gene  who)   2. Task  to  perform  for  a  specific  purpose  (the  gene  what),     3. Reward  for  the  crowd  (the  gene  why),       10  
  • 11. 4. Participative  process  (the  gene  how),     5. Crowdsourcer  that  launches  the  activity,     6. Reward  for  this  crowdsourcer,     7. The  existence  of  an  open  call       8. The  use  of  Internet.       E.   Estellés   adds,   “although   crowdsourcing   is   a   case   of   collective   intelligence,   not   all   cases  of  collective  intelligence  are  crowdsourcing.”     Advantages   of   Wisdom   of   Crowd:   J.   Howe   states,   “Given   the   right   set   of   conditions  the  crowd  will  almost  always  outperform  any  number  of  employees”       A  group  of  individuals  has  more  knowledge  for  solving  a  problem  than  any   single   individual.       Collective   intelligence   creates   a   quilt   of   knowledge   that   many  people  can  distribute.       Studies   by   Caltech   professor   Scott   E   Page   confirm   that   crowds   consistently   outperform   even   concentrated   groups   of   highly   intelligence   people.     Examples   of  crowd  wisdom  include  idea  jams  and  prediction  markets.         1.1.1.2. Crowd  Creation   As   described   in   Steve   Keifer’s   blog   post  “Four   Types   of   Crowdsourcing”,   “crowd   Creation   is   contemporarily   the   most   popular   form   of   pooling   knowledge   from   the   masses”.    Often  confused  with  the  crowd  wisdom,  which  is  simply  gathering  ideas  from   crowd,   crowds   create   original   works   of   knowledge   or   art,  such   as   individuals   filming   TV   commercials,   performing   language   translation   or   solving   challenging   scientific   problems.  The  crowd  contributes  to  a  movement  and  then  the  company  performed  it.   Paul  Sloane  in  his  book  “A  Guide  to  Open  Innovation  and  Crowdsourcing:  Advice  From   Leading   Experts”   he   complete   the   description   by   stating   the   following:   ‘the   action   of     11  
  • 12. creativity   must   be   broken   down   into   very   small   individual   pieces   that   can   be   performed   in  “spare  circles”.       The  most  famous  examples  of  companies  using  the  Crowd-­‐Creation  are:     • Threadless.com  –  Creative  consumers  propose  new  T-­‐Shirt  ideas  for  sale  on  the  site   • iStockPhoto  –   Amateur   photographers   contribute   high   quality   stock   photography   images   • Linux  –   Open   source   operating   system   developed   by   community   of   avid   programmers   Since   both  “Crowd   Creation”   and   “Co-­‐Creation”   involve   some   kind   of   collaboration,   the   separation   line   between   the   two   terms   can   be   blurred   at   times.   However   there   is   real   difference  between  both  terms,  which  will  be  outlined  afterwards.       1.1.1.3. Co-­‐Creation     Operating  like  crowdsourcing,  Co-­‐creation  is  a  considered  a  collaborative  initiative,  by   seeking  information  and  ideas  from  a  group  of  people.  However,  one  crucial  difference   between   the  two   lies  with  the  call,  which  is   not   put   to   an   open   forum   or   platform   but   to   a  smaller  group  of  individuals  with  “specialized”  skills  and  talents.     “It   captures   the   ideas   of   the   many   and   work   with   them   through   different   steps   to   ultimately  create  a  better  experience  for  the  consumer.  It’s  about  working  collaboratively   with  a  group  of  people  with  specialized  skills  or  talents.  Crowdsourcing  focuses  on  quantity   and  results  in  incremental  changes,  co-­‐creation  focuses  on  quality  and  produces  innovative   solutions.  Also  co-­‐creation  is  not  about  picking  one  from  many  but  about  working  together.   So   the   main   difference   is   that   co-­‐creation   depends   on   the   skills   of   a   specialized   group   to   work  on  one  solution.  ”  (Teng,  2011)     Co-­‐creation   perceived   as   a   tool   in   the   open   innovation   toolkit.   Co-­‐creation   is   a   joint   effort   of   the   producer   and   the   customer   to   develop   new   products   or   services   (Prahalad,     12  
  • 13. 2000).  It  involves  a  two-­‐way  interaction  between  customers  and  companies,  as  well  as   peer-­‐to-­‐peer  communication  among  customers.  In  marketing,  co-­‐creation  is  seen  as  a   new  branding  paradigm  (Schultz,  2010)     1.1.1.4.   Crowd  Voting     It   consists   in   openly   asking   questions   and   collecting   answers   through   mechanisms   such   as  polls  or  elections.     It   is   a   way   of   using   the   crowd’s   judgment   and   leveraging   it   to   organize,   filter   and   stack-­‐ rank  vast  quantity  of  information  such  as  newspaper  articles,  music  and  movies.  A  great   example   of   crowd   voting   includes   Google’s   search   result,   which   search   engines   are   based   on   algorithms   that   Google   uses   to   give   relevance   to   their   results   via   links   and   page  reviews,  that  is  to  say  give  the  site  popularity.  By  definition,  Google  search  engine   is  built  upon  the  principle  of  Crowd  Voting.       This  form  of  crowdsourcing  generates  the  highest  levels  of  participation.  J.  Howe  cites   the  1:10:89  Rule,  which  states  that  for  every  given  100  people     • 1  will  create  something  valuable   • 10  will  vote  and  rate  submissions   • 89  will  consume  creation   For   the   10   that   vote   and   rate   content   “the   act   of   consumption   was   itself   an   act   of   creation.”   Voting  and  ratings  have  been  made  possible  thanks  to  the  Internet.    Performed  by  end-­‐ users  or  computer-­‐driven  algorithms,  the  mechanism  that  assesses  popularity  via  links   and  page  views  are  numerous.       “In   Real   Life”   a   great   example   of   Crowd   Voting   is   Reality   TV   shows.  According   to   J.   Howe  “American  Idol  is  the  largest  focus  group  ever  conducted”.     Threadless.com   classified   as   Crowd   Creation   also   uses   Crowd   Voting   to   decide,   from   all   the   T-­‐shirt   submitted   on   the   website,   which   ones   to   manufacture   and     13  
  • 14. sell.     Consequently,  Threadless.com  is  able  to  measure  end-­‐consumer  demand  for  new   products  before  making  further  investment.         1.1.1.5. Crowd  Funding   The   term   basically   describes   participation   by   the   crowd   in   micro   lending.   Also   considered  as  “fundraising  the  social  way”  it  is  a  “collective  cooperation,  attention  and   trust  by  the  people  who  pool  money  or  other  resources  to  finance  or  help  a  project”.     Steve   Keifer   in   his   article   Four   Types   of  Crowdsourcing   states   that   “Crowd-­‐Funding   circumvents   the   traditional   corporate   establishment   to   offer   financing”     (Keifer)Indeed,   it  gives  individuals  or  groups,  that  cannot  get  credit  or  opportunities  to  obtain  a  loan  by   the  traditional  system,  the  financing  opportunities  that  might  otherwise  be  denied.       Typically,   under-­‐funded   populations   would   include   individuals   or   groups   with   creative   projects  and  ideas  such  as  amateur  musicians.  Well  known  for  the  music  industry,  it  is   quite  famous  for  creative  project  as  film,  and  business  ideas.       MyMajorCompany.com  is  a  great  example  of  crowd  funding.  Its  music  website  connects   investors   and   artists   in   one   place   through   its   online   platform.  Within   the   community,   users   are   able   to   invest   in   artists   they   pick   for   a   return   in   album   sales   (Rupert,   2011)   while   artists   raise   money   to   record   their   albums.   The   platform   fully   operates   as   a   functioning  record  label  headed  by  industry  professionals.             14  
  • 15. 1.2. Business  Model  Typology       With  the  intent  to  go  further  into  crowdsourcing,  M.  Arfaoui,  writer  of  “Understanding  a   new  typology  of  crowdsourcing  business  models”  paper  (Arfaoui),  developed  a  typology   of   crowdsourcing   that   allowed   him   to   identify   four   different   models   of   qualitative   crowdsourcing.  Out  of  these  four  models,  which  will  be  defined  afterwards,  he  identifies   2  types  of  Crowdsourcing:  Quantitative  and  Qualitative.       1.2.1. Quantitative  crowdsourcing:     This  type  of  crowdsourcing,  calls  on  the  crowd  to  fulfill  quite  simple  and  short  tasks  in   relatively  high  quantities.  Generally,  these  tasks  will  not  need  a  high  level  creativity  and   are  99  %  of  the  time  financially  rewarded.  It  is  most  commonly  called  “micro-­‐tasking”  or   “cloud-­‐labor”.       1.2.2. Qualitative  crowdsourcing:     In   opposition   to   quantitative   crowdsourcing,   the   qualitative   crowdsourcing   requires   more   complex   skills   and   competencies   from   the   crowd   as   companies   use   it   to   resolve   larger   and   complicated   projects.   “The   crowd   is   sourced   to   bring   either   an   opinion,   a   reflection,   an   intellectual   or   an   artistic   work,   or   a   solution   to   a   sophisticated   problem.   Rewards  can  be  financial  or  not.  “     To  better  understand  the  following  figures  of  Crowdsourcing  Business  Models  the   following  legend  is  needed.         15  
  • 16.       Symbols     Synonyms     &  Colors     Crowd   User  -­‐  Submitter  -­‐  Creator  -­‐  Contributor  -­‐   Customer   Consumer  –  Client  Company  -­‐  Buyer   Company   Business  -­‐  Model  -­‐  Platform  -­‐  Intermediary   -­‐  Website       1.2.2.1.  Store  Model     The  members  of  the  crowd  (group  or  individuals)  sell  their  products  or  service  (mostly   creations)  to  a  crowdsourcing  company.   Present  as  an  outlet.     Companies   using   this   model   mostly   provide  repeatedly  financial  rewards   to   the   actors   of   the   outlet.   M.   Arfaoui  adds  that,  to  be  sustainable,   companies   tend   to   implement   a   ““few-­‐to-­‐many”   relationship   (ratio   crowd/uses   <   1)   and   that   the   companies  make  revenue  out  of  the     Figure  2:  Store  Model     transactions  between  crowd  and  customers”.           16  
  • 17. 1.2.2.2.    Request-­‐to-­‐Proposal  Model     Members   of   the   crowd   are   competitors   to   each   other.   The   Crowdsourcing   company,   acting   here  as  an  intermediary,  provides   the   crowd   with   the   required   material  to  compete.     The   crowdsourcing   company   operates  as  a  “hub”  to  customers,   most  of  the  time  corporations  and   business.   They   gather   the   information  and  make  a  request  in   the  form  of  an  open  call.       Figure  3:  Request-­‐to-­‐Proposal  Model     The   significant   difference   with   the   above-­‐described   model   (Store   Model)   is   that   this   model  requires  a  “many-­‐to-­‐few  relationship”  to  be  profitable  (ratio  crowd/customer   >   1).     Businesses   processing   this   model   of   crowdsourcing,   promptly   offer   financial   incentives,   in   order   to   attract   many   proposals   but   reward   only   a   very   limited   part   of   them.   “Independently   or   not   from   that,   the   company   will   earn   a   revenue   from   selling   the   access  to  the  crowd-­‐base  itself.”         1.2.2.3.    Data  Model   The  core  of  the  Data  Model  is  the  community.  Social  or  not,  the  crowd  community  will   grow  around  the  company’s  network  system.     The  company’s  challenge  is  to  attract  as  much  users  as  possible  to  create  the  maximum   amount  of  data,  from  contact  information  to  random  content  as  media  and  photos,  out     17  
  • 18. of   the   crowd.   This   content   will   be   valuable   for   both   corporate   accounts   (interested   in   massive  data  exploitation)  and  for  premium  users  (interested  in  the  direct  usage  of  the   data  or  the  platform  itself)     Figure  4  :  Data  Model       1.2.2.4. Collaborative  (Peer)  Model     This  model  gives  priority  to  the  creation  through  a  collaboration  platform.  The  crowd,   here  considered  as  collaborators,  works  on  particular  parts  of  a  product.  Collaborators   progressively  propose  a  finalized  version  of  it.       18  
  • 19. The   finalized   product   will   either   be   sold   to   the   crowd   itself   or   to   real   customers   /   end   users.     Figure  5:  Collaborative  (Peer)  Model     As   it   is   quite   complicated   to   crowd-­‐source   the   full   process   of   creation,   this   model   is   a   “few-­‐to-­‐few”  relation,  or  at  best  “few-­‐to-­‐many”  relation.     The   set   of   characteristics   built   from   incentives   and   crowd’s   role   allow   a   better   understanding   of   the   factors   of   crowdsourcing   business   models,   which,   well,   chosen,   lead  to  a  more  efficient  implementation  and  a  positioning  on  the  markets.       These   four   crowdsourcing   business   models,   allow   us   to   determine   that   by   extension,   crowdsourcing  is  a  collaborative  process.       Developing   a   typological   approach   on   the   elements   of   crowdsourcing   leads   us   to   questioning   ourselves   about   the   related   concept   of   “innovation”.   We   previously   developed  that  the  concept  of  collective  intelligence  (Surowiecki,  2004)  and  co-­‐creation   (Prahalad, 2000)  were  different  but  still  closely  related.       19  
  • 20.   Also,   the   paradigm   of   collaborative   innovation,   which   includes   open   innovation   (Chesbrough,  2006)  and  user  innovation  (von  Hippel,  2005)  overlaps  with  the  notion  of   Crowdsourcing.       1.2.3. Innovation     Before  going  any  further  into  analyzing  each  of  these  paradigms,  it  is  important  to  take   a  step  back  to  the  description  of  Innovation,  strictly  speaking.       Figure  6:  Closed  Innovation   Source:  Paul  Sloane     Innovation   as   we   know   it,   is   closed   to   any   outside   company’s   contribution.   Meaning   that   everything   is   created   within   the   company.   Ideas   are   generated,   then   developed,   built,   marketed,   distributed,   financed,   and   supported   internally.   “Closed   innovation   exploits  existing  internal  infrastructure  and  capabilities”  (Sloane,  2012).         20  
  • 21. Many  authors  tend  to  identify  the  crowdsourcing  with  Open  Innovation,  treating  both   as   synonyms  (CHANAL,   2010),   identifying   crowdsourcing   as   a   particular   type   of   Open   Innovation   (Nambisan)   (Sawhney,   2007),   (Burger-­‐Helmchen,   2010)   Aitamurto,  Leiponen  and  Tee,   inspired   by   Schenk   and   Guittard   ’s   figure   of   Crowdsourcing,   Open   Innovation,   User   Innovation   and   Open   Source   (Aitamurto,   June   2011),  distinguish  each  of  the  following  paradigms  with  the  following  figure.     Open  Innovation     User  Innovation     Co-­‐Creation   Crowdsourcing   Figure  7:  Crowdsourcing,  Open  Innovation,  User  Innovation  and  Open  Source     Jeffrey   Phillips,   in   his   chapter   “Open   Innovation   Typology”   of   the   book  “A   Guide   to   Open   Innovation   and   Crowdsourcing”,  distinguishes   the   crowdsourcing   as   a   way   of   implementing  Open  Innovation.  (Sloane,  2012)     Within   the   open   innovation   paradigm,   crowdsourcing   can   be   perceived   as   a   tool   to   gather  ideas,  innovations,  or  information  for  certain  purposes.  It  can  thus  be  viewed  as  a   method   of   open   innovation.   Also   “co-­‐creation”   combines   user   innovation   and   crowdsourcing  and  is  additionally  a  subset  of  the  open  innovation  concept     1.2.4. Open  Innovation       Henry   Chesbrough   coined   the   term  open   innovation.   He   defines   it   as   a   paradigm   that   assumes   firms  can   and   should   use   ideas   both   internal   and   external,   and   internal   and   external  channels  to  market.     21  
  • 22.  It’s   “the   use   of   purposive   inflows   and   outflows   of   knowledge   to   accelerate   internal   innovation  and  expand  the  markets  for  external  use  of  innovation.”     Considered   as   “a   new   research   and   development   model”   it   shifts   away   from   the   traditional  closed  innovation  system,  as  defined  previously,  where  innovation  processes   are  mostly  generated  inside  the  organization  and  ideas  from  outside  of  the  organization   are  often  treated  with  “not-­‐invented-­‐here”  mentality.  (Aitamurto,  June  2011)     Open   innovation   establishes   new   paths   to   commercialize   the   innovation   done   within   the  company,  both  by  using  informal  and  formal  ties  to  partners,  for  example  through   exploiting   the   possibilities   for   revenue   streams   by   using   open   application   programming   interfaces.  (Chesbrough,  2006)  (Aitamurto,  June  2011)   Source:  Paul  Sloane     Figure  8:  Open  Innovation     The  similarity  between  the  crowdsourcing  and  open  innovation  is  because  they  are  both   based   on   the   same   paradigm:   knowledge   is   distributed   and   its   use   (in   the   R&D   processes,  for  example)  can  be  a  competitive  advantage.       22  
  • 23. Despite  the  similar  elements  and  characteristics  (i.e.:  reducing  risk,  increasing  the  speed   in   product   development),   there   are   author,   such   as   Brabham   and   Schenk   &   Guittard,   which  tend  to  separate  the  two  concepts.  The  two  main  differences  that  prevent  the  full   and   unambiguous   identification   between   the   two   types   of   processes   are   as   follows   (Schenk  &  Guittard,  2009):  (Schenk,  2009)   1. “Open  Innovation  focuses  only  on  the  innovation  process,  while  crowdsourcing   can  pursue  other  goals:  funding  through  crowdfunding,  discover  use  opinions   through  crowdvoting,  etc.     2. Strictly  speaking,  Open  Innovation  describes  the  interaction  between   firms  (through  patents,  joint  adventures,  et),  while  crowdsourcing  describes  the   interaction  between  a  crowdsourcer  (whether  a  company,  institution,  individual,   etc.)  and  the  crowd.”     We  can  surely  conclude  that  there  are  common  areas  between  crowdsourcing  and  Open   Innovation   since   both   can   use   the   same   business   model.   However,  not   all   crowdsourcing  initiatives  involve  Open  Innovation,  not  any  Open  Innovation  activity  has   to  be  carried  out  though  a  crowdsourcing  initiative.  (Estellés-­‐Arolas  &  Gonzales-­‐Ladron-­‐ de-­‐Guevera,  2012)     1.2.5. User  innovation       In   the   manufacturer-­‐centric   model,   manufacturers   develop   products   and   services   in   a   closed   way,   by   using   patents,   copyrights,   and   other   protections   to   prevent   imitators   from   free   riding   on   their   innovation   investments.   Also,   the   user’s   only   role   is   to   have   needs,   which   manufacturers   then   identify   and   fill   by   designing   and   producing   new   products  (von  Hippel,  2005)     In   opposition,   user-­‐centered   innovation   processes   are   very   different   from   this   traditional  model.  Indeed,  users  are  active  contributors  to  the  innovation  process.  (von   Hippel,  2005).  Lead  users  facing  specific  needs  (and  possibly  anticipate  market  needs),     23  
  • 24. ready   to   bear   some   of   the   costs   and   risks   associated   with   innovation   drive   the   User   Innovation.   User   Innovation   represents   the   “non-­‐linear”   dimension   of   the   innovation   process:   users   and   market   feedback   are   source   of   novelty   for   the   innovating   firm.   (Schenk,  2009)     The  possible  confusion  between  User  Innovation  and  Crowdsourcing  stems  from  the  fact   that  end  users  are  likely  to  be  found  within  the  crowd.  However  these  concepts  describe   very   different   phenomena.   Crowdsourcing   suggests   that   the   crowd   can   provide   firms   with  resources  under  specific  conditions,  but  it  does  not  imply  customer  feedback  in  the   innovation  process.  (Schenk,  2009)     As   potential   innovation   collaboration   opportunities   proliferate,   it’s   compulsory   understanding  how  best  to  leverage  crowd’s,  thus  collaborator’s  power.     From   crowdsourcing   to   open   innovation,   opportunities   are   numerous   when   using   “collaboration”,   however   to   ensure   its   sustainability,   it   is   necessary   to   study   its   applicability   in   terms   of   governance   and   extent   of   participation   and   define   the   boundaries   of   collaboration.   Each   Mode   of   collaboration   requires   different   dynamics   and  strategies  and  outcomes  vary  from  one  each  other.     Figure  9:  The  four  ways  to  collaborate       24  
  • 25.   To  select  the  right  type  of  collaboration  options  for  a  business,  Pisano  and  Verganti,  in   their  paper  “Which  Kind  of  Collaboration  Is  Right  for  You?”  recommend  understanding   basics   of   the   four   collaboration   modes.   These   modes   differ   along   two   dimensions:   openness  or  Participation  (can  anyone  participate,  or  just  select  players?)  and  hierarchy   or  Governance  (who  makes  key  decisions—one  “kingpin”  participant  or  all  players?).     There   are   four   basic   modes   of   collaboration   developed   by   Pisano   and   Verganti.   “The   Four  Ways  to  Collaborate”  concept,  defines  the  following  modes  for  user  participation:       • Elite  circle:  a  closed  and  hierarchical  mode,     o The   company   selects   certain   participants   and   decides   which   ideas   get   developed.     • Innovation  mall:  an  open  and  hierarchical  mode,     o Anyone   can   offer   ideas   but   your   company   de-­‐   fines   the   problem   and   chooses  the  solution.     • Innovation  community:  an  open  and  flat  mode,     o Anyone   can   solicit   and   offer   ideas,   and   no   single   participant   has   the   authority  to  decide  what  is  or  isn’t  a  valid  innovation.     • Consortium:  a  closed  and  flat  mode.   o A  select  group  is  invited  to  offer  ideas.  But  participants  share  information   and  intellectual  property  and  make  critical  decisions  together.           25  
  • 26. 1.3. Formulating  Hypothesis       As   exposed   earlier,   Internet   usage   has   changed   the   way   business   think   and   work.   Customers   are   demanding   more   customized   products,   and   to   meet   this   need,   companies   may   need   to   use   crowdsourcing   to   build   on   the   tacit   knowledge   from   customers’  experiences.  Today's  ultra-­‐competitive  environment  makes  it  difficult  to  be   successful   with   just   great   products,   services   and   traditional   marketing   alone.   Gaining   awareness  requires  great  communication  skills,  in  this  sense  getting  the  customer  to  be   notified   about   one   company's   product   or   service   makes   it   obvious   that   using   new   technologies   help   to   make   them   informed   purchasers.   The   evolution   related   to   the   technologies  leads  us  to  the  following  hypothesis     1.3.1. Traditional  In-­‐House  management,  as  a  stand-­‐alone  strategy,   is  no  longer  enough     Managing  business  processes  and  keeping  them  under  control  are  critical  for  companies   across   all   industries.   However,   for   many   companies   from   various   sectors,   redesigning   business   processes   and   management   often   leads   to   costs   savings   and   increased   efficiencies.   Crowdsourcing   appears   as   an   alternative   to   the   traditional   approach   as   it   takes  advantage  of  the  crowd’s  potential  available.     Under   some   circumstances,   crowdsourcing   is   a   powerful   tool   for   innovation   process.   However,  one  cannot  claim  firmly  that  crowdsourcing  can  always  lead  to  success  since   there  are  still  need  for  research  to  improve  the  process  and  consequently  the  outcome   of  the  crowdsourcing.     1.3.2. Crowdsourcing,  is  an  effective  business  model  for  any  type  of   business       Crowdsourcing   offers   unprecedented   potential   for   solving   tasks   efficiently   by   tapping   into   the   skills   of   large   groups   of   people.     Crowdsourcing   expands   a   company’s   ability   to     26  
  • 27. be   innovative,   customer   friendly   and   create   new   levels   of   customer   involvement   that   has  never  been  seen  before.     Products,   whether   traditional   goods   or   services,   rapidly   become   standards,   and   companies   can   find   competitive   advantage   by   differentiating   their   products   in   a   crowdsourcing   process   with   users   and   customers.   Furthermore,   customers   are   demanding   more   customized   products,   and   to   meet   this   need,   companies   may   need   to   use  crowdsourcing  to  build  on  the  tacit  knowledge  from  customers’  experiences.     Crowdsourcing   platforms   appear   to   be   interesting   organizational   forms   that   combine   community   dynamics   and   market   relationships,   internal   and   external   human   resources,   non-­‐financial  and  financial  rewards,  contribution  by  both  experts  and  amateurs,  etc.  It   may  be  that  these  organizations  are  the  prototypes  of  major  evolutions  in  ways  of  doing   business  in  the  near  future.     1.3.3. Crowdsourcing  guarantees  quality  work.     The   principle   of   crowdsourcing   is   that   “the   Many   Are   Smarter   Than   the   Few”.   By   canvassing   a   large   crowd   of   people   for   ideas,   skills,   or   participation,   the   quality   of   content   and   idea   generation   will   be   superior.   Crowdsourcing   actually   increases   the   quality   and   decreases   the   price,   compared   to   in-­‐house   management   or   online   freelancing.   It   can   also   be   a   lot   faster   and   lead   to   higher   quality   work   as   people   are   competing   against   each   other   (as   humans,   we   all   want   to   win   after   all).    The   amount   of   responses   leads   to   larger   choice   of   work.   However,   quality   can   be   difficult   to   judge   if   proper  expectations  are  not  clearly  stated.         27  
  • 28.   Figure  10:  Crowdsourcing  Industry  Revenue  Growth     Millions  of  $US,  based  on  a  sample  of  15  leading  crowdsourcing  service  providers  (CSPs)     1.3.4. Crowdsourcing,  is  suitable  for  any  type  of  business       Crowdsourcing   brings   together   people   from   different   parts   of   the   world   and   different   sectors   of   business   to   work   together   on   a   project.   This   is   effectively   a   collection   of   different   fields   and   levels   of   expertise   that   would   not   otherwise   be   available   to   any   business.       Companies   of   all   shapes,   sizes   and   business   genres,   individuals,   non-­‐profit   organizations  and  even  government  groups  can  benefit  from  the  crowd  engagement.     Procter   and   Gamble,   IBM,   Dell,   Lego,   Starbucks,   Coca-­‐Cola,   and   Nokia   that   are   large   companies  are  among  the  big  adopters  of  crowdsourcing  practices.       28  
  • 29. It  has  helped  these  firms  develop  new  products  at  lower  cost,  brainstorm  new  ideas  and   emerging   trends,   solve   technical   problems,   design   logos   and   packaging,   gather   feedback  and  business  ideas,  and  design  advertising  campaigns.”  See  appendix  [2].       1.3.5. Every  task  can  be  crowdsourced.     Just   about   any   step   in   a   product   development   and   product-­‐marketing   model   can   be   crowd-­‐sourced.   You   can   crowd-­‐source   one   step   or   multiple,   including   fundraising,   naming,   conception,   development,   Q&A,   and   pricing,   depending   on   the   company   resources,   needs   and   goals.   The   biggest   benefit   is   that   crowdsourcing   is   a   very   cost-­‐ effective  way  to  resolve  business  issues.  The  biggest  disadvantage  is  that  if  not  properly   managed,  the  process  can  lose  control  and  spiral  into  a  time-­‐consuming  disaster.           29  
  • 30. 2. RESEARCH  METHODOLOGY     2.1. Introduction     This   chapter   focuses   the   methodology   adopted   in   undertaking   this   research   and   begins   with   the   description   of   the   method   adopted   in   this   survey.   It   follows   the   four   step   sequences:   methodology   selection,   case   study   analysis,   problem   definition,   and   research  objectives.     2.2.  Methodology  Selection       2.2.1. Qualitative  research   To  gain  a  deeper  understanding  and  to  gather  an  in-­‐depth  understanding  this  thesis  will   be   driven   by   a   qualitative   research   methodology   on   accordance   with   exploratory   research  type.     Exploratory  data  analysis     We   find   ourselves   in   a   context   where   we   seek   to   understand   a   phenomenon   of   substance,  for  which  a  qualitative  study  proves  to  be  the  best  solution.  The  quantitative   study   did   not   seem   relevant   in   this   context,   because   the   phenomenon   in   question   seems   difficult   to   quantify   or   generalize.   Beyond   the   explanatory   function   that   is   the   qualitative   study,   it   will   help   to   develop   knowledge   about   issues   that   have   little   or   no   research  so  far  been  treated.  Therefore,  it  will  have  an  important  exploratory  function  in   order  to  better  understand  the  phenomenon  on  which  it  is  directed.     As  this  study  relies  on  secondary  research  such  as  reviewing  available  literature  and/or   data   and   more   formal   approaches   through   in-­‐depth   analysis   of   the   Capseo   Business   Model   the   exploratory   research   approach   is   the   most   appropriate.   These   data   have   been  analyzed  for  the  purpose  of  formulating  hypotheses.     30  
  • 31. We  will  identify  patterns  and  relationships  thanks  to  literature  review  and  Capseo’s       Process.       Problem  >  Data  >  Analysis  >  Model  >  Conclusions     2.2.2. Presentation  of  the  Case  Study     Capseo  is  a  startup  launched  in  France  (Lyon)  in  September  2009.  The  startup  appears   to  represent  a  original  case  of  crowdsourcing  with  high  potential  as  it  offers  a  platform   for   a   community   of   SEOers   and   web   marketing   professionals   to   manage   an   entire   project  management  process,  from  hiring  freelancer,  content  creation,  link  generation   and   eventually   to   payment   of   the   freelancers.   The   case   of   Capseo   is   also   particularly   interesting   in   that   its   aim   is   to   apply   crowdsourcing   to   web   marketing   projects   development   through   a   platform   that,   thanks   to   its   algorithms,   allowing   a   perfect   match  between  what  the  customers  expects  and  the  freelancers  skills  and  knowledge.   The   customer   keeps   an   eye   on   his   project   without   being   directly   in   contact   with   the   freelancers  working  or  even  knowing  who  they  are.       In  the  initial  Capseo  business  model,  humans  through  a  platform  internally  developed   managed   the   projects.   Meaning   that   when   a   new   project   came   in,   the   project   manager   was   in   charge   of   choosing   who   were   the   most   suitable   and   qualified   freelancers   for   a   given   project.   Freelancers   would   submit   their   work   in   that   platform   and   project   manager   would   review   and   approve   the   work.   Following   this   paper   Stakes,   limits   and   opportunities,   how   to   take   advantage   of   the   crowdsourcing   to   offer   a   strong   value   proposition   to   your   customers?   a   new   platform   was   developed   and   built   internally   too,   it   was   publicly   launched   in   the   US   market   and   investors   have   potentially   shown   their   interest   in   financing   the   future   of   Capseo.   The   business   model   was   based   on   the   idea   that  Capseo  would  fully  manage  the  process  management  through  the  platform.  From   customer  order  to  task  management,  an  even  online  payment  and  in  this  way  be  more   cost   effective.   It   became   clear,   however,   that   the   original   model   was   too   time     31  
  • 32. consuming  and  Capseo  is  progressively  abandoning  it.     Capseo,   thought   its   platform   is   more   of   an   intermediate,   whilst   continuing   with   the   concept  of  collective  work  done  by  a  community.  The  following  concept  was  adopted:   the  collective  created  work  could  still  be  managed  and  above  all  directly  be  reviewed  by   the   community   leaders.   The   hierarchy   would   establish   itself   with   thanks   to   the   evaluation   of   the   freelancers.   Capseo   would   earn   revenue   on   additional   services   for   firms  such  as  the  use  of  the  platform  for  agencies.  For  example,  web  agencies  would  be   granted  special  access  to  the  platform  and  use  Capseo’s  resources  and  full  database  to   manage   their   own   projects,   content   creation   and   other   requirements   in   collaboration   with  the  communities.  We  will  look  at  the  evolution  of  the  company’s  business  model  in   more  detail  later  on  in  the  company  section  of  this  paper.     2.2.3. Data  collection     The  collaborative  research  process  described  here  covers  a  18-­‐months  period  between   September  2011  and  May  2013.  Over  this  period,  the  research  covered  a  personal  work   managed   project,   customer   feedbacks,   the   comments   of   Capseo’s   staff,   including   the   CEO  of  the  company,  Anji  Ismail,  and,  somehow  the  third  parties  as  the  freelancers  and   the  customers.    This  period  can  be  split  into  two  main  phases.  Phase  1  focused  on  the   management   of   the   project   with   the   first   platform,   that   we   can   consider   as   elaboration   of   the   first   business   model,   the   launch   of   the   platform   and   the   appraisal   of   the   first   results.   After   a   few   months   of   business   activity   with   results   that   could   obviously   be   improved,   Capseo’s   founders   decided   to   rearrange   the   business   model,   giving   it   a   somewhat  different  orientation.  Phase  2  corresponds  to  the  design  and  development  of   this  new  platform,  which  required  the  development  of  a  algorithm  and  a  full  restructure   of   the   platform   as   it   was   thought   initially.   Considerable   modifications   were   brought   when  compared  to  the  first  platform.       The  data  collected  is  as  follows:     -­‐  The  empirical  material  of  the  projects       32  
  • 33. -­‐  The  theoretical  material  introduced  by  the  staff:  formal  presentations  and  brought  in   new  ideas  to  be  tested  by  the  CEO  and  to  help  him  in  his  analysis.       The   framework   used   to   guide   the   strategic   reflection   is   inspired   by   other   research   (Chesbrough   &   Rosenbloom,   2002;   Chesbrough   2006a:   109;   Osterwalder   &   Pigneur,   2005;  Schweizer,  2005;  Lecocq  et  al.,  2006;  Warnier  et  al,  2004).       Our   analysis   focused   on   value   creation   and   value   capture,   and   more   specifically   examined   the   three   following   building   blocks   that   characterize   a   business   model:   the   value   proposition   (including   the   offer   based   on   the   technology,   the   choice   of   market   segments   and   the   customer   interface   process),   the   business   model   infrastructure   (including  the  firm’s  resources,  competencies  and  capabilities,  the  structure  of  the  value   chain  and  the  positioning  and  relationships  of  the  firm  within  the  value  network),  and   the  revenue  model  (including  both  cost  structure  and  revenue  model).     2.2.4. Problem  definition       As  developed  previously  in  the  literature  review  marketers  used  to  rely  solely  on  what   has   been   working   for   them   in   the   past   using   industry   standard   approaches,   unwilling   to   explore  new  options.     Many   researchers   have   first   seen   the   crowdsourcing   as   a   competitor   to   traditional   in-­‐ house  management  rather  than  considering  it  as  a  complementary  process  that  could   enhance  mutual  growth  across  multiple  processes  by  building  synergies.     Research  question   Stakes,  limits  and  opportunities,  how  to  take  advantage  of  the  crowdsourcing  to  offer  a   strong  value  proposition  to  your  customers?             33  
  • 34.   2.2.5.  Research  Objectives     This  study  aims  at  understanding  what  the  stakes  and  limits  of  having  a  crowdsourcing-­‐ oriented  strategy  and  the  impact  of  implementing  as  a  business  model  are.  In  light  of   the   previous   literature   analysis,   the   objective   will   be   to   set   up   a   scalable   strategy   combining  both  social-­‐media  and  traditional  marketing.         34  
  • 35. 3. FIELDWORK       3.1. Capseo     Capseo   was   founded   in   2009   by   two   EMLyon   Alumni;   Anji   Ismail   &   Faouzi   Elyagoubi.   Though   originally   based   in   Lyon   at   EMLyon’s   incubator,   this   small   start-­‐up   has   expanded  to  the  United  States  by  opening  an  office  at  the  Plug  and  Play  Tech  Center  in   Sunnyvale,  California  in  April  2011.     3.1.1. What  does  Capseo  do?       Capseo   is   the   service   provider   of   an   innovative   e-­‐marketing   platform   based   on   the   power  of  crowdsourcing.  Capseo  acts  as  an  intermediary  between  the  “customers,”  or   the  companies  subscribing  to  their  e-­‐marketing  services  and  the  “influencers”  hired  to   expand   the   company’s   presence   on   the   web.   Capseo   oversees   the   coordination   of   marketing  efforts  generated  by  their  influencers  throughout  their  assignment.     3.1.2. Customers       Capseo   customers   may   be   individual   businesses   with   limited   resources   or   marketing   agencies   seeking   additional   assistance   for   a   project.   Relying   on   Capseo’s   resources   produces   higher   quality   results   in   a   faster   period   of   time   at   a   lower   cost.   Once   subscribing   to   the   Capseo   service,   customers   can   monitor   their   progress   through   the   online  portfolio.     3.1.3. Influencers/Suppliers       All   of   Capseo’s   influencers   are   hand   selected   for   each   task   by   the   staff   based   on   their   special   interests,   number   of   followers,   geographic   location   and   language   skills.     35  
  • 36. Influencers   must   meet   qualifications   and   undergo   rigorous   testing   in   order   to   qualify   to   meet  the  Capseo  standard  implemented  to  guarantee  quality  in  their  service.   3.1.4. Different  roles     The  main  process  of  Capseo  is  based  on  an  exchange  on  three  different  levels:       • Capseo   and   its   team,   which   is   the   intermediary   between   the   two   entities   that   follow     • Clients   and   Prospects   who   usually   come   to   Capseo   to   ask   how   do   their   performances   work   and   explain   their   needs   in   improving   their   ranking   in   Search   Engines,   and   at   the   end   possibly   increase   rather   their   conversion   rate   (if   they   own  a  e-­‐commerce  website).       • Influencers,   SEOers,   professional   internet   marketers   recruited   by   Capseo   by   the   intermediate   of   blogs   and   websites   for   their   skills   in   writing,   but   also   their   interests,  place  of  living  (…)   Clients  &   Prospects     needs   Capseo intermediate and organization Influencers  &   Partners     have  the  skills     Figure  11:  Scheme  of  Capseo's  Organization         36  
  • 37. 3.1.5. Capseo  Crowdsourced  System     When  contacted  by  prospects,  a  dedicated  person  of  the  team  establishes  a  proposal,  or   commercial   proposition   and   a   planning   according   to   strategies   and   goals   with   the   concerned  project  manager  (or  other),  Capseo  concentrate  on  the  different  goals  that  it   has  fixed,  which  also  can  be  subdivided  into  two  main  categories  of  actions:   • SEO  (Search  Engine  Optimization)  or  natural  referencing   • SMO  or  Social  Media  Optimization     The  SEO  part  can  be  subdivided  into  three  other  categories  that  are:  the  technique  (all   that   implies   coding   properly),   the   contents   and   texts   that   need   to   be   improved,   and   finally  the  links  that  redirect  web  surfers  on  their  website  and  counted  by  the  number  of   “clicks”.  Natural  referencing  is  a  concept  referring  to  the  fact  that  websites  are  classified   on   search   engines   “naturally”   or   “organically”   (Google   is   the   major   search   engine   in   the   market,   and   throughout   the   world).   It   is   quite   easy   to   check   whether   or   not   a   website   is   well  structured  and  valuable  to  Search  Engines  such  as  Google.  Upon  that  a  website  will   be   well   ranked   on   search   engines   thanks   to   different   tools.   The   two   metrics   that   are   commonly  used  more  often  are  the  Alexa  Rank,  and  the  Page  Rank.  It  is  not  necessary   to   go   into   further   explanation   of   these   two   metrics.       Both   are   numbers,   the   first   one   telling  the  general  ranking  of  the  website  globally  and  in  its  country  of  origin  depending   on   the   number   of   “clicks”   generated,   and   the   Page   Rank   is   about   the   credibility   and   relevance   of   it.   The   lower   the   Alexa   Rank,   the   better.   The   higher   the   Page   Ranke   the   better.         The   SMO   part   is   on   another   hand   the   management   of   one   or   more   accounts   of   the   client’s   brand/website   on   different   social   medias   personal   or   professional,   from   Facebook   to   Twitter   and   LinkedIn   most   of   the   time.   This   is   often   asked   because   companies   are   aware   that   nowadays,   the   majority   of   the   prospects   and   clients   are   a   lot   more  influenced  on  the  web  than  by  the  TV.  That  comes  from  the  fact  that  our  principal   correspondents   are   people   from   our   siblings,   fellows,   school   or   work,   which   mean     37  
  • 38. people   “like   us”   that   can   easily   make   us   consume   what   they   have   because   we   trust   them  more  than  TV  commercials.     The   next   step   for   Capseo   is   to   search   for   adapted   and   qualified   influencers/writers/bloggers   to   have   matching   skills   and   expertise   to   clients   according   to   their   needs.   Most   of   the   time,   the   participation   of   influencers   is   about   articles   published   and   remunerated   that   are   called   sponsored   posts,   which   provide   more   backlinks  to  the  clients  in  the  SEO  section.       Freelancers  are  all  evaluated  to  be  part  of  the  Capseo’s  members.  To  prove  their  level  is   acceptable  freelancers  should  get  certified  by  first  answering  a  questionnaire  and  then   by   doing   assigned   tasks.   They   are   also   evaluated   all   along   their   membership.   Each   accomplished   task   is   evaluated   and   provides   points.   The   more   point   they   get,   the   higher  they  are  paid.  However,  if  a  task  is  refused,  the  freelancers  will  loose  points.         In   order   to   provide   clients   and   partners,   such   as   freelancers   with   a   real   interface   to   communicate  more  rapidly,  Capseo  created  and  is  monitoring  a  platform.    It  allows:   • Capseo  to  submit  the  tasks  to  the  selected  freelancers,     • The  customer  to  monitor  his  own  campaign     • The  freelancers  to  process  their  task       Capseo             ts     ac i nt er   ac   er i nt ts       PROJECT           Customer   Country:  USA    never  interacts  b ut   see  each  other     Task  1:     SEOer   Task  2:     Blogger     Country:  France       Figure  13:  Capseo  Crowdsourcing  System         38  
  • 39. The   issue   is   that   everyone   could   see   information   that   was   sometimes   meant   to   be   confidential.  For  example,  Capseo  didn’t  want  the  customer  to  see  the  contact  details  of   the   freelancers   working   on   his   campaign   because   the   customer   could   get   in   contact   with   the   freelancers   and   ask   him   to   work   directly   for   him   rather   than   letting   Capseo   manage  the  campaign.     .     3.1.6. Industry  Analysis  Summary       Search  Engine  Marketing  (SEM)  and  Search  Engine  Optimization  (SEO)  are  some  of  the   most   common   ways   of   advertising   for   Internet-­‐based   companies.   Both   SEM   and   SEO   are  used  to  increase  the  visibility  of  websites  on  search  engine  page  results.     Google  continues  to  close  in  on  70  percent  market  share,  moving  up  0.1  percent  again   this   month   to   take   a   U.S.   record   67   percent   of   all   search   traffic   in   November,  comScore  reported.     An   expected   growth   of   16%   will   come   from   an   increase   in   spending   on   SEO,   social   media  marketing  and  mobile  advertising  while  another  54%  of  businesses  are  planning   to  increase  their  SEO  budget,  compared  to  10%  who  are  planning  to  decrease  it  (Brent   Rangen,   2011).   Another   study   shows   that   88%   of   US   marketers   are   increasing   their   social  media-­‐marketing  budget  in  US.  ("88  percent  of,"  2011)  If  the  SEM  industry  follows   the  current  trends,  it  will  be  a  $26  billion  industry  by  2013.     This  industry  analysis  is  based  on  the  model  of  Porter’s  five  forces.       3.1.6.1. Customer  Power   Over  90%  of  the  U.S.  companies  use  SEO  and  SEM  for  website  optimization.  SEM  has   become   essential   for   website   optimization   regardless   of   size   of   company.   As   demand   for   SEO   and   SEM   has   grown   over   the   past   10   years,   suppliers   have   also   steadily   increased   to   maintain   place   in   the   market.   However   there   is   a   more   need   of   SEM   marketers  as  the  budget  is  increasing.       39  
  • 40. As  a  result,  the  customer  has  a  moderate  bargaining  power.       3.1.6.2. Supplier  Power     We  can  consider  two  types  of  suppliers  for  Capseo:    Search  Engines  &  Influencers       For   search   engine,   Google   is   the   strongest   supplier   to   Capseo   as   Google   already   dominates   the   search   engine   market   share.     Search   engines,   such   as   Google,   Yahoo!   and   Bing   etc.,   as   well   as   social   media   sites,   such   as   Facebook,   Twitter   etc.   Google   dominates   the   American   search   engine   market   with   over   65.5%   of   the   market   share   (Brian  Womack,  2011)  and  Facebook  is  a  social  media  giant.       Also,   other   main   suppliers   are   the   influencers,   web   marketer   professionals,   bloggers   and  content  writer  for  which  the  bargaining  power  is  low.  If  freelancers  refuse  to  work,   there   are   thousands   of   people   can   replace   them.   If   content   writers   or   bloggers   that   supply   content   increase   price,   there   are   other   content   writers   and   bloggers   in   the   same   space  that  do  the  same  exact  work.  Capseo  can  hire  any  content  writers  and  bloggers  it   chooses  to  accomplish  tasks  and  can  bring  the  work  in  house  or  hire  new  contractors  or   new  companies  to  complete  the  work.       Therefore  the  bargaining  power  of  the  suppliers  in  this  industry  is  moderate.       3.1.6.3. Threat  of  New  Entrants     Capital  Requirement  and  Time     If   we   consider   the   competitive   advantage   of   Capseo:   its   algorithm   and   platform,   it   needs   goods   developers   and   engineers   to   develop   an   algorithm   and   site   (platform)   similar  to  Capseo  for  a  new  entrants.  And  it  takes  a  efforts  to  build  up  the  company  and   attract  users.  It  is  not  likely  that  competitors  will  enter  the  market  on  a  similar  platform.   However   a   big   company   with   millions   dollar   available   could   easily   develop   such   a     40  
  • 41. service.         Economies  of  Scale     The   threat   of   new   entrants   in   search   engine   market   is   relatively   low   because   competitors   are   all   over   the   world   and   has   captured   so   many   skills   about   search   engines,   a   new   entrant   would   have   easy   access   to   all   the   required   data   and   information   to  learn  how  to  do  SEO.  It  should  however  provide  even  better  search  results  at  faster   speed   and   presents   information   from   diverse   sources   in   a   more   unified   and   customized   way.   Absolute  Cost  Advantage     In   this   competitive   market,   the   new   entrants   have   to   possess   an   absolute   cost   advantage  comparing  to  others;  for  example,  new  entrants  have  to  come  up  a  better,   cheaper   and   more   efficient   plan   to   do   SEO   internationally.   New   entrants   should   have   lower  cost  of  producing  the  services  compared  to  Capseo.       Brand  Loyalty   For  new  entrants,  brand  loyalty  is  not  a  tough  entry  barrier  to  overcome  unless  the  rival   product   offering   is   of   fundamentally   and   significantly   greater   value.   However,   the   market   now   is   mature   enough,   without   a   necessary   path   dependency   to   gather   data   on   both   the   content   of   web   pages   and   the   search   histories   of   users.   With   such   competitive   and  growing  market  and  strong  competitors,  the  threat  of  entry  rather  high.     If  we  consider  only  the  activity  of  SEO  and  SEM  marketing,  it  has  been  around  for  few   years.   The   competitive   advantage   of   Capseo   should   make   the   difference   within   a   few   years.  However  for  now  it  is  relatively  easy  to  learn  SEO  and  SEM  marketing  and  start  a   company.    For  this  reason,  entry  barriers  for  newcomers  are  weak.       3.1.6.4. Threat  of  Substitutes     Despite   being   common   concepts,   SEO   and   SEM   are   not   only   utilized   as   methods   to     41  
  • 42. promote  and  stimulate  traffic  to  a  website.  There  is  also  a  “pay  per  click”  and  “pay  per   impression”   medium   of   advertisement   widely   used   for   marketing.   However,   SEO   and   SEM  are  cheaper  mediums  of  advertisement,  therefore  the  threat  of  substitutes  is  low.     Competitive  Intensity       The  intensity  of  competitive  rivalry  is  high  because  of:       Low  Exit  Barriers     Termination   of   a   low   number   of   workforce,   goodwill   and   legal   issues   would   not   too   much  to  quit  the  business.  Capseo  has  built  its  brand  value  laboriously  but  such  could   moderately  be  ignored.     New   companies   and   freelancers   offering   SEO   and   SEM   advertisement   are   growing   to   fulfill   a   high   demand   of   the   market.   Barriers   to   entry   are   low   while   the   customer   and   supplier  bargaining  power  is  moderate.  However  SEO  and  SEM  are  the  most  essential   marketing   services   and   have   the   advantage   of   being   relatively   inexpensive.   Google   AdWords,   Yahoo!   Search,   and   Microsoft   AdCenter   are   major   players   in   pay-­‐per-­‐click   advertising;   Facebook   in   social   media   marketing   and   Odesk   and   ELancers   in   hiring   freelance  SEOers.  Since  there  are  no  sign  of  a  slowing  growth,  Capseo  has  the  potential   to  be  very  profitable  in  this  industry.       3.1.6.5. Conclusion   The   Five   Force   model   helps   analyzing   the   external   environment   of   Capseo   in   a   detailed   and  organized  way.     It  shows  that  the  threat  of  entry  is  low  because  of  the  domination  of  a  few  companies  in   the  market.  Besides  that,  the  bargaining  power  of  customers  is  strong  as  their  switching   costs  are  low.  Moreover,  the  bargaining  power  of  supplier  is  medium  as  the  number  of   suppliers   is   huge   in   the   market.   Furthermore,   the   intensity   of   competitive   rivalry   is   high     42  
  • 43. because  of  high  cost  in  existing  the  business.  Lastly,  the  threat  of  substitutes  is  strong   because  the  existing  corporations  are  strongly  competitive.   Based   on   the   above   analysis,   it   can   be   concluded   that   the   strong   competitors   in   the   market  indeed  cause  problems  or  somehow  challenges  to  Capseo.     3.1.7. Capseo  new  vision       In   order   to   provide   clients   and   partners   with   a   real   interface   to   communicate   more   rapidly  while  meeting  Capseo  requirement  as  we  explain  previously,  Capseo  created  a   new   platform.   The   goal   is   that   the   company   will   not   have   to   contact   at   every   campaign   all  the  possibly  interested  partners,  which  is  kind  of  a  fastidious  task  whenever  there  are   several  campaigns  running  through.     The  algorithm  will  go  through  the  whole  database  of  freelancers,  and  will  assign  tasks   to  the  matching  freelancers  for  each  task  of  a  given  web  marketing  campaign.        This  would  allow  to  consequently  decrease  the  work  of  Capseo’s  employees  spent  on   asking   to   the   community   whether   or   not   they   are   interested,   and   more   on   the   organization  and  guidelines  in  general.       3.1.7.1. DOZ.com:  Capseo’s  new  product     In   March   2013,   Capseo   has   launched   a   new   product   called   DOZ   (www.doz.com.   Exclusively   designed   and   tailored   for   B2C   websites   with   needs   of   international   web   marketing.           43  
  • 44. DOZ.com     Online  Marketing:     Crowdsourced  Execution:     Online  Platform   Increasing  audience  and   Increasing  audience  and   Follow  campaigns   conversions     conversions     and  marketers’  work   Qualifying  traffic  from   Qualifying  traffic  from   Monitoring  and  Reporting,   organic  channels   organic  channels   24/7  online   Engage  audience  and   Engage  audience  and   Performance  and   improve  brand  image   improve  brand  image   competition  analysis   1.1.1. Value  Proposition       Doz’s  customer  will  experience  the  following:             They  choose:     Know  what  they  pay:   Follow  their  campaign:   • The  channels   • Monthly  Fee   • Tasks  by  tasks   • The  goals   • Price  Per  Visitor   • Marketing  KPIs   • The  length   • Price  Per  Tasks   • Milestone     Local  Web  Marketing   • Market  and  language  knowledge   • •   Cultural  adaptation   Localized  influencers  and  supports   44  
  • 45.   To  this  point  the  collaboration  mode  that  Capseo  uses  is  close  to  the  Elite  Circle  mode,   which   is   hierarchical   in   terms   of   governance   and   Closed   in   term   in   participation.   Indeed,   Capseo  choses  a  selected  group  of  participants  and  also  defines  the  problem  and  picks   the  solution.  The  real  difference  is  that  a  unique  person  is  working  on  a  task  at  a  time.   There  ‘s  no  possibility  to  have  two  freelancers  working  on  the  exact  same  task.  In  that,   Capseo   has   it’s   own   crowdsourcing   methods.   The   choice   is   not   make   by   humans.   Capseo’s   algorithm   takes   care   of   choosing   the   right   match   between   the   customers’   needs  and  the  freelancers’  skills.       That   number   one   problem   that   came   out   of   every   potential   customers   mind   that   Capseo   tried   to   make   business   with   in   France   is   it   that   they   “   find   it   hard   to   rely   on   freelancers   they   can’t   exchange   with”.   In   other   words,   they   were   questioning   if   the   service   we   offer   may   not   be   quality   work   since   they   didn’t   know   if   they   truly   were   experts  in  a  specifics  business.  It  is  quite  understandable  that  customer  can  have  doubts   on   who   Capseo   is   hiring   to   do   the   tasks   for   an   online   marketing   campaign   however   Capseo   faced   a   problem   that   seems   not   to   exist   within   the   US   market.   Indeed,   crowdsourcing   in   the   US   market   seems   to   be   well   established   in   different   industry,   while  the  market  is  not  mature  enough  in  France  and  other  European  countries.       While  the  in  the  past,  specialists  would  safely  keep  privy  information  to  themselves,  the   resources  available  in  the  contemporary  era  provide  even  those  without  formal  training.   Information  and  results  are  much  easier  to  obtain  on  a  comparable  level.         In   a   situation   where   a   result   is   needed   that   doesn’t   necessarily   require   professional   opinion,   pooling   the   efforts   of   a   variety   of   people   for   a   fraction   of   the   professional   cost   is   a   favorable   option   for   many   companies.   This,   of   course,   does   not   diminish   the   prestige  or  utility  of  the  expert.    (Cheryl  Milone,  2011)     To   some   point   it   seems   that   modern   technology   blurred   the   distinction   between   professionals  and  amateurs.       45  
  • 46. 4. VERIFYING  HYPOTHESIS       In   the   following   chapter,   we   are   testing   the   hypothesis   stated   at   the   light   of   the   literature   conclusion.   The   tests   lean   upon   Capseo’s   case   and   the   general   trend   that   comes  out  of  the  review  of  the  market.     The  answer  to  the  hypothesis  will  be  either  approved  or  disapproved  in  accordance  with   the  analysis  carried  out.       4.1. Traditional  In-­‐House  management,  as  a  stand-­‐alone  strategy,  is  no   longer  enough     Most  traditional  organizations  tend  to  look  like  this:     Figure  12:  Traditional  Organizational  Structure   This   structure   has   been   quite   popular   and   successful   for   most   companies   for   decades   but   customer   interaction   was   usually   really   limited.   However,   to   understand   further   interactions  with  the  customer  such  a  common  organization  structure  needs  to  be  dug   deeper   into.   By   doing   such   an   analysis   any   type   of   company   could   gain   a   better   understanding   of   how   newer   crowdsourcing   firms   work   and   the   challenges   they   face   as   they  grow  along.  The  productivity  of  the  in-­‐house  solution  is  fixed  and  normalized.     This   structure   is   prone   to   many   issues,   primary   of   which   is   the   lack   of   new   ideas.     46  
  • 47. “Thinking  outside  the  box”  for  many  businesses  is  the  key  to  innovation,  and  represents   a  real  added  value  to  growth,  which  are  important  for  a  company  to  remain  attractive.     However,  all  firms  can’t  resort  to  crowdsourcing.  It  is  not  suitable  for  any  type  of   business  as  a  Business  Model.  It  is  obvious  that  new  technologies  made  it  simple  to  have   recourse  to  freelancers  for  many  online  businesses,  which  take  advantage  of  a  cheaper   workforce  and  more  flexibility  but  few  type  of  businesses  can  simply  not  use  the   crowdsourcing  as  a  business  model  because  of  their  type  of  business.  The  key  to   choosing  the  right  model  is  to  first  determine  if  the  process  can  better  be  handled  in-­‐ house  or  crowdsourced  to  external  peers     Eventually,  to  engage  in  a  successful  strategy,  whether  it’s  done  in-­‐house  or  outside  of   an   organization,   it   is   important   to   fully   understand   the   goals   and   objectives   of   the   organization   and   how   the   strategy   will   impact   it.   Even   thought   it   is   not   suitable   for   a   specific   industry,   studies   have   shown   that   there’s   always   a   part   of   the   organization   that   can  be  crowdsourced,  just  has  it  used  to  be  outsourced.  In  any  cases,  companies  need  to   be  completely  keyed  in  to  both  their  consumers’  and  partners’  work  close  with  the  other   parts  of  their  organization  to  ensure  they  get  the  most  of  crowdsourcing.  It  is  important   to  research  all  technology  options  to  have  a  full  understanding  of  what  technology  can   do  for  the  organization.  Make  a  thorough  review  of  the  business  processes  to  see  where   crowdsourcing  is  appropriate  in  each  process.    All  organization  should  keep  in  mind  that   the  right  decision  will  vary  according  to  the  firm’s  organization.     Some  companies  decided  to  build  their  own  crowdsourcing  capabilities  internally.  This   is   not   something   most   companies   are   experienced   with   or   prepared   to   do   by   themselves.   It   does   not   make   sense   to   build   a   crowdsourcing   environment   in-­‐house   unless  the  work  to  be  done  is  strategic  to  the  business.     The   following   hypothesis   development   will   go   deeper   into   the   clarification   of   what   businesses  meet  the  requirement  of  crowdsourcing  and  vice  versa.         Traditional  In-­‐House  Management  is  no  longer  enough.  >  YES             47  
  • 48.   4.2. Crowdsourcing,  is  an  effective  business  model  for  any  type  of  business       The  numerous  examples  of  business  model  based  on  crowdsourcing  that  have  resulted   successful  have  proved  that  Crowd  Business  Model  is  the  key  to  prosperous  and  wealthy   business.  Yet,  if  a  company  considers  resorting  to  crowdsourcing,  it  should  take  two   aspects  of  its  business:     • Monetization     • Success  factors       1.  Monetization       48  
  • 49. It   is   important   for   companies   to   question   themselves:   When   does   crowdsourcing   work?   Eventually   to   engage   in   a   successful   Crowd   Business   Model   it   is   important   to   fully   understand   the   goals   and   objectives   of   the   organization   and   how   the   strategy   will   impact   it.   To   gain   this   information,   it   is   important   to   go   through   a   full   analysis   of   the   management  at  all  levels  to  ensure  the  goals  are  clearly  defined.         2. Success  factors         Crowdsourcing,  is  an  effective  business  model  for  any  type  of  business  >  NO         49  
  • 50. 4.3.  Crowdsourcing  guarantees  quality  work       Open   method   brings   variety   to   an   organization,   and   it   includes   both   amateur   and   professional-­‐level   submissions.   However,   preliminary   findings   suggest   that   once   the   quality   of   submissions   rises   to   professional   level,   the   amateur   participants   might   not   see  the  value  in  their  participation.     In   crowdsourcing,   as   it   happens   in   other   areas,   is   raising   not   only   interest   and   enthusiasm,   but   also   severe   criticism   and   serious   worries,   notably   about   the   unfavorable   effects   it   has   on   the   status   of   professional.   The   reality   is   that   while   amateurs  lower  consequently  the  prices  on  the  market  without  being  able  to  guarantee   high  quality  standards,  professionals’  survival  is  at  stake.       Obtaining  reliable  results  from  the  crowd  remains  a  challenging  task  (Kazai  &  al.,2009).   It  requires  a  careful  design  of  the  experiment  and  also  pre-­‐selection  of  crowdsourcers.   Different  ways  for  obtaining  reliable  results  have  been  implemented  by  Capseo.      Grade  &  Reward  the  crowd.     Grading   them   puts   the   crowd   into   competition   and   rewarding   them   motivates   the   crowd.    A  study,  conducted  on  the  crowdsourcing  platform  Mechanical  Turk,  explored  a   range   of   variables   to   determinate   the   different   factors  that   might   be   affecting   quality   and   their   possible   interdependence.   It   investigates   the   impact   of   different   presentation   methods,  workers’  base  and  payment  scale  on  the  quality  of  the  results.     It   resulted   that   it   was   not   clear   whether   the   poor   quality   work   is   caused   by   a   lack   of   worker’s  motivation,  the  worker’s  interpretation  of  the  task  or  genuine  ambiguity.     One   of   the   interesting   findings   is   that   the   studies’   results   do   not   confirm   previous   studies   which   concluded   that   an   increase   in   payment   attracts   more   quality   work,   and   also   the   country   of   origin   only   has   an   impact   in   some   of   the   categories   and   only   in   general  text  tasks  but  there  is  no  significant  difference  at  the  top  pay.     To  make  sure  the  quality  of  the  work  is  as  expected,  Capseo  has  implemented  a  Peer   Review   feature   that   allows   the   project   manager   of   a   given   campaign   to   review   and     50  
  • 51. accept   or   refuse   the   task.   If   the   task   is   refused,   the   crowd   loses   points   and   gets   less   money  than  expected.       There   is   no   doubt   that   expert   quality   can   be   achieved   by   aggregating   the   results   obtained  from  a  number  of  workers,  e.g.  However,  the  exploration  into  what  factors  do   (or  do  not)  affect  annotation  quality  has  only  just  started.  (Snow  et  al.,  2008).     At  this  stage,  it  is  still  not  relevant  to  say  that  Crowdsourcing  guarantees  quality  work   before  it  highly  depends  on  the  set  of  factors  such  as  rewards  and  motivation.       To   make   sure   the   quality   of   work   is   as   expected,   companies   should   follow   the   following   step  as  guidelines:       1. Be  clear  on  the  brief     As  with  any  online  marketing  project,  it  is  essential  to  be  very  clear  on  what  is  expected   to  achieve.  Communication  with  collaborators  is  usually  managed  via  the  website  with   public  and  private  messaging  –  it  is  necessary  to  be  able  to  clearly  articulate  in  writing   what   a   company   is   looking   for,   and   to   provide   timely   and   honest   feedback   to   contributors.     2. Manage  the  process     If  not  already  observed,  things  happen  pretty  fast  on  the  Internet!    If  a  business  values   immediate   results,   it   should   consider   instant   gratification,   then   crowdsourcing   will   definitely   deliver   that!    Once   a   project   launched–   a   process   as   simple   as   signing   up,   completing   a   form   and   hitting   ‘submit’   –   we   tasks   should   be   submitted   in   within   24   hours.    To  keep  the  project  on  track  it  is  important  to  monitor  it  daily  and  keep  informed   via   automated   emails,   rate   the   tasks   submitted   using   a   ‘star’   rating   and   instantly   eliminate  any  tasks  that  are  not  suitable.         51  
  • 52.   3. Communicate  and  give  feedback     Most  crowd  members  and  freelancers  people  live  and  breathe  on  client  feedback  –  they   need  to  know  quickly  whether  their  concepts  are  on  the  right  track  or  whether  they’ve   missed   the   mark   completely.       Using   a   rating   system   to   rank   our   favorite   freelancers   highly,   but   most   importantly,   giving   personalized   feedback   to   every   task   submitted.   This   should   keep   the   crowd   really   engaged   and   interested   throughout   the   whole   process.    Offering   feedback   also   helps   other   designers   who   had   not   yet   submitted   their   tasks,  to  develop  something  really  exciting  since  they  have  access  to  the  comments  and   feedback.     Firms   should   also   take   into   consideration   that   the   salient   feature   of   crowdsourcing   -­‐   its   openness   of   entry-­‐   makes   it   vulnerable   to   malicious   behavior.   Whenever   a   firm   decides   whether  or  not  to  resort  to  crowdsourcing  it  has  to  consider  the  tradeoff  between  the   potential   of   productivity   increase   with   the   possibility   of   being   set   back   by   malicious   behavior.       Studies   of   these   tradeoffs   show   that,   in   a   game   where   two   firms   compete   against   each   other  to  obtain  a  better  solution  to  a  task.  Results  show  that  malicious  behavior  is  the   norm,   as   it   tends   to   emerge   under   a   wide   variety   of   conditions.   Counter   intuitively,   increasing   the   cost   of   an   attack   has   no   deterring   effect   on   malicious   behavior,   and   favors  the  weakest,  least  productive  firm.  These  findings  have  cautionary  implications   for   the   design   of   crowdsourcing   competitions;   for   corporate   decisions   on   whether   to   crowdsource   or   not;   and   ultimately   for   understanding   the   long-­‐term   prospects   of   open,   collective  problem  solving.  (V.  Naroditskiy)       Crowdsourcing  guarantees  quality  work  >  YES           52  
  • 53. 4.4.Crowdsourcing,  is  suitable  for  any  type  of  business       Like   many   aspects   of   digital  business,  crowdsourcing  is   a   strange   and   foreign   creature   to  most  non-­‐Internet  businesses.     The   notion   that   crowdsourcing   can   be   applicable   to   every   type   of   business   is   flawed.   Each  enterprise  should  employ  a  set  of  strategies  in  committing  to  a  form  of  open  and   collaborative   innovation   methods   (Pisano,   2008).   An   enterprise   should   consider   its   capabilities,   organizational   structure   and   the   reason   why   it   is   looking   for   creating   value   through  open  modes  of  innovation.  Some  firms,  for  example,  are  looking  for  a  large  set   of   ideas   to   get   inspired   for   future   innovation.   In   this   order,   a   crowdsourcing   practice   that  could  address  a  large,  undefined  network  of  crowd  would  be  the  best  recipe.     In   any   case,   it   is   closely   related   to   the   Hypothesis   2   “Crowdsourcing,   is   an   effective   business  model  for  any  type  of  business”.       Crowdsourcing,  is  suitable  for  any  type  of  business  >  No     4.5. Every  task  can  be  crowd  sourced     Being   able   to   tap   into   online   communities   to   offload   work   is   what   many   businesses   have  recently  tried  to  drive  efficiency  and  innovation.       While   Internet   startups   have   had   considerable   success   thanks   to   crowdsourcing   over   the   last   few   years,   it's   only   recently   that   they   have   focused   on   creating   the   tools   and   growing  communities  that  can  be  readily  consumed  by  enterprises.     Various  crowdsourcing  services  have  become  available  to  a  wide  range  of  company  and   industry  over  the  last  few  years.  Some  of  these  services  are  now  well-­‐known  players  but   there  are  also  countless  attractive  new  entrants.  Most  companies  have  ready  access  to   crowdsourcing   across   a   wide   set   of   functional   areas,   to   the   extent   that   it's   often   the   easiest   thing   for   them   to   try   before   going   experiencing   real   crowd-­‐sourcing   as   business   model.   It   noticeably   has   implications   for   business   agility   as   well   that   can't   be   ignored     53  
  • 54. and   with   low   costs   opportunity.   Assuming   that   the   market   expects   more   and   more   businesses   to   be   experimenting   with   these   tools   over   the   next   year   to   find   out   what   they  can  do.     Here  is  how  the  major  types  of  crowdsourcing  break  down  today  with  examples  of  some   of  the  providers  operating  currently  for  business  use:     4.5.1. Functional  business  areas   There  are  five  functional  business  areas  suitable  for  crowdsourcing:  (Hinchcliffe,  2009)       Problem  Solving.     The   leading   service   in   the   area   of   open   innovation   is   problem   solving,   which   has   over   180,000   contributors   that   can   work   on   problems   in   science,   manufacturing,   biotech,   medicine   and   many   other   fields.   They   offer   rewards   ranging   from   $5,000   up   to   $1   million   for   solutions   to   submitted   problems.   It   is   not   yet   clear   if   this   model   really   works   better   for   solving   difficult   business   challenges?   Reports   shows   that   up   to   a   74%   ROI   for   crowdsourcing  over  central  production  methods.       Design   Today  crowdsourced  design  is  often  associated  to  Web  design  and  leading  offerings  like   provide   marketplaces   to   crowdsource   Web   designs   cheaply   and   quickly.   That   doesn't   mean   that's   all   there   is   and   some   marketplaces,   design   for   other   things   as   well,   such   as   apparel.     Business   helps   crowdsource   marketing   and   creative   work,   and   general-­‐ purpose  tools  or  help  to  strategically  farm  specific  design  decisions  across  a  own  private   or  public  community.  More  traditional  services  provide  on-­‐demand  design  work,  but  are   less  structured  to  create  multiple  competing  inputs.         54  
  • 55.   Work.   For  many  kinds  of  simple  tasks,  particularly  if  they  are  small,  there  have  emerged  highly   granular   on-­‐demand   work   marketplaces.   You   can't   outsource   complex   tasks   to   these   crowdsourcing  platform,  they're  primarily  designed  for  simple  things.     Testing.   "Users  as  testers"  has  been  a  growing  meme  for  assuring  user  input  from  customers  is   broad  based  and  thorough.         Support.   Online   customer   communities   have   been   a   steadily   growing   source   of  crowdsourced  customer  service  and  support  for  companies  that   understand   how   to   grow  and  nurture  them.  Crowdsourcing  customer  support  to  get  the  answers  you  need,   is  often  much  better  and  more  accurate.         Courdsourcing  Categories       Crowdsourcing  platforms  complete  a  variety  of  tasks  by  leveraging  the  crowd  in  various   ways.  Below  four  main  ways  crowdsourcing  is  being  used.     Crowdsourcing   provides   multiple   options   and   can   solve   complex   problems.   Unfortunately,   it   can   be   difficult   to   manage   this   crowd   and   frustrating   to   sift   through   the  results  to  find  the  right  option.     And,   not   every   task   is   suitable   for   crowdsourcing.   Below   is   a   list   of   some   common   categories  of  crowdsourcing:           55  
  • 56.   Microtasks   Macrotasks   Breaking  down  a  large   Presenting  a  project  to   project  into  a  series  of   the  crowd  and  allowing   tiny  tasks  that  are   the  knowledgeable   completed  by  multiple   portion  of  the  crowd  to   individuals  within  a   accept  and  complete  the   crowd.     task.     DEFINED   Data  Valuation     BEST   Research     FOR      Image  tagging     Crowdfunding     Raising  money  for  a   specific  cause,  project   other  use  by  accepting   small  amounts  of  money   from  multiple  individuals.   Project  Fundraising     R&D/  Product  Innovation     Translation      Artistic  Support     Startups     Market  Research     Microtasks   Micro-­‐tasks  are  small,  repetitive  tasks  completed  by  online  crowd  workers.  It  is  a  great   way   to   start   when   using   crowdsourcing   for   the   first   time.   A   crowd   of   workers   complete   "small   and   repetitive"   tasks   for   significantly   lowers   costs   than   any   other   in-­‐house   processed   tasks   and   it   saves   time.   Here   is   the   list   of   micro   tasks   that   can   be   crowdsourced  are:   • • Writing  product  descriptions   • Researching  and  organizing  contact  information   • Small  web  research   • Language  translations   • Tag,  sort,  and  label  photos   • Digitizing  paper  work,  scanning  documents   •   Creating  content   Transcribing  audio  files   56  
  • 57. Many  micro  tasks  include  data  work.  There  are  tools  of  a  great  help,  which  has  a  built-­‐in   crowdsourcing   feature,   and   allow   testing   the   crowdsourcing   waters   before   diving   into   a   complex  project.     Macrotasks   Macrotasking  involves  having  crowd-­‐workers  use  their  skills  and  expertize  to  complete   portions  of  a  larger,  more  complex  project.  Macro-­‐tasking  jobs  often  consist  of  research   and   development   projects,   including   innovation   challenges.   Remember   you   are   empowering   the   crowd   to   use   their   skills   for   a   bigger   project   or   challenge,   so   organization   and   communication   are   essential   here.   Usually   macro-­‐tasks   fall   under   broad  categories.  Some  examples  of  macro-­‐tasking  categories  are:   • Ecological/Green  solutions   • Socially-­‐motivated  projects   • Medical  solutions  &  innovations   • Innovations  that  maximize  productivity  and  convenience   Crowdfunding     Crowdfunding  involves  having  a  crowd  give  funds  to  a  project  or  task  you  will  complete.   Rather  than  you  giving  money  to  a  crowd  to  complete  tasks,  they  are  giving  you  money   to  complete  your  own  task  or  project.  With  crowdfunding,  the  sky  is  the  limit!  If  you  can   convince   a   crowd   to   fund   your   idea,   you   can   do   it.   But,   to   help   you   get   a   grasp   on   projects  you  could  possibly  crowdfund,  some  examples  are:   • • Educational  programs   • Films  &  documentaries   • Music  albums  &  pts   • Book  publication   •   Charitable  or  practical  inventions   Charitable  projects  that  require  travel,  resources,  and  assistance   57  
  • 58. Contest     Graphic  design  is  the  most  common  task  to  crowdsource.  Basic  graphic  design  is  a  good   place  to  start.  We  suggest  crowdsourcing  any  design  that  you  would  consider  sending   to   freelance,   or   internal,   designers.   The   best   part   of   crowdsourcing   graphic   designs   is   that   you’ll   get   something   totally   original   and   customized.  Some   examples   of   graphic   design  to  crowdsource  are:   •  Logo  design   • Webpage  redesign   • The  design  of  your  next  direct  mail  piece  or  business  card     Any  task  can  be  crowd  sourced  >  No     5. RECOMMENDATIONS       This   section   compiles   the   results   of   the   data   and   analysis   carried   out   previously   into   recommendations  for  an  objective-­‐oriented  crowdsourcing  plan  to  optimized  its  impact   and   return   on   investment   of   businesses.   Mixing   crowdsourcing   to   in-­‐house   management  improves  both.   The   challenge   is   about   finding   the   best   suitable   way   to   use   crowdsourcing,   take   advantages   of   it,   without   the   constraints,   limits   and   restrictions   that   make   them   a   obstacle  to  businesses.     With  Anji  Ismail,  CEO  of  Capseo,  and  Nick  Mathers,  we  engage  in  collaborative  research   to   build   a   sustaining   a   talented   workforce   impacts   brand,   quality,   customers’   satisfaction   and   ultimately   the   trajectory   of   the   company.   Anji   coined   the   concept   of   Prosourcing.       The   idea   was   to   come   up   with   a   new   concept   built   on   Crowdsourcing   model:   Prosourcing.  A  technology  driven,  outsourcing  system  developed  to  fulfill  international     58  
  • 59. projects.   It   generates   professional   profiles   based   on   social   data   and   parlays   this   information   to   match   skills   with   business   tasks.   It   pulls   from   the   same   large   pool   of   labor  but  eliminates  the  frustrating  process  of  sifting  through  and  managing  this  crowd.   Prosourcing   gathers   data   and   applies   filter   to   locate   qualified   outsourcing   options.   It   then  completes  business  tasks  by  allocating  work  to  the  various  options  it  recognizes  as   qualified.  The  result  is  a  more  tailored,  effective  and  comprehensive  hiring  ecosystem.   Prosourcing   is   able   to   categorize,   match,   and   manage   this   labor   thru   the   use   of   technology  applied  on  the  prosourcing  platform.   5.1. Prosourcing  platform     Figure  13:  Prosourcing  System     The   prosourcing   platform   gathers   data   and   organizes   the   labor   crowd.   It   starts   by   collecting   social   data,   public   information   and   online   profiles   (such   as   Facebook   and   LinkedIn)   for   all   potential   labor   options.   The   platform   then   categorizes   this   data   to   create   a   comprehensive   resume   for   each   contractor.   It   contains   all   information   about   the   laborer’s   location,   expertise,   passion,   social   reach,   reviews,   and   past   work   history.   Similar   to   a   dating   service,   the   platform   uses   these   detailed   profiles   to   match   labor   and   tasks   based   on   compatibility.   It   filters   labor   to   find   the   right   expertise,   passion,   experience,   and   location   for   that   specific   project.   The   platform   then   allocates   various     59  
  • 60. parts  of  a  project  to  the  qualified  laborers.  The  labor  is  managed  by  the  platform  from   start  to  finish.  The  result  is  high-­‐level  task  completion  without  the  management.   5.1.1. Advantages  of  Prosourcing     Prosourcing   can   be   used   to   complete   creative   tasks   associated   with   marketing,   software   development,   application   development,   website   creation,   design,   consulting   and   IT   security.   Area   specific   platforms   help   businesses   locate   and   manage   the   specialized   workforce   for   that   field.   Here   is   the   value   prosourcing   can   provide   a   business:   Process:   Rather   than   work   on   a   project   in   hopes   of   being   selected,   experts   are   pre   chosen  and  paid  to  complete  micro  tasks  or  parts  of  projects.     Filters:   Uses   social   data   and   profiling   to   qualify   the   crowd   and   deliver   more   powerful   results.   Global   capabilities:   Can   locate   professionals   with   localized   expertise   in   a   specific   foreign  market.   Cost-­‐beneficial:  Provides  access  to  contractors  at  a  lower  price  than  hiring  and  training   new  employees  or  using  a  large  outsourcer.   Scalable:   Can   help   accomplish   large   goals   by   allocating   work   to   a   wide   range   of   contractors  with  diverse  expertise.       Less   Management:   No   need   to   find,   manage   and   pay   various   contractors   or   freelancers.  This  is  all  handled  by  the  prosourcing  platform.     5.1.1.1. Contractor  satisfaction     Business  clients  benefit  greatly  from  the  prosourcing  process.  But,  they  are  not  the  only   beneficiaries.  The  labor  pool  also  benefits  from  this  process.  Prosourcing  allocates  tasks     60  
  • 61. to   contractors   before   they   start   working.   This   provides   the   contractors   with   less   uncertainty,  and  more  security.   Prosourcing’s   ability   to   analyze   social   data,   rather   than   just   professional   degrees   and   credentials  also  appeals  to  contractors.  It  has  the  ability  to  match  them  based  on  their   likes  and  interests.  For  example,  if  social  data  indicates  that  a  contractor  is  passionate   about   mountain   biking,   but   not   tea.   The   platform   will   match   this   contractor   with   a   marketing  campaign  for  mountain  bikes  and  avoid  assigning  him  a  marketing  campaign   for  tea.  The  freelancer  is  more  satisfied  because  he  is  working  on  a  project  related  to  his   passion.  Effectively  satisfying  all  aspects  of  the  “Labor  Hierarchy  of  Needs.”     Figure  14:  Prosourcing  Difference   Similar  to  other  methods  of  employment,  prosourcing  provides  laborers  compensation,   job   security,   responsibility   and   recognition.   The   prosourcing   difference   is   its   ability   to   fulfill   the   last   step   of   the   pyramid.   It   allows   contractors   to   work   on   more   fulfilling   projects.  In  return,  they  produce  stronger  results.       61  
  • 62. 5.1.2. Starting  the  Prosourcing  Trend       A   great   deal   of   companies   has   already   begun   building   prosourcing   platforms.   These   companies  are  gathering  professional  data  and  using  it  to  better  match  freelancers  with   tasks.   Below   are   some   of   the   companies   building   platforms   and   moving   into   the   prosourcing  space:       62  
  • 63.   5.1.2.1. Real-­‐Life  Example     A  U.S.  winemaker  based  in  Napa  Valley  grows,  bottles,  and  sells  a  high-­‐end  wine.  This   wine   has   strong   sales   throughout   the   United   States,   but   wants   to   expand   and   sell   more   wine  abroad.  It  identifies  Brazil  as  the  foreign  market  with  the  most  potential.  However   there  is  a  problem,  this  winemaker  has  zero  marketing  expertise  in  that  market.  It  could   hire   a   comprehensive   marketer.   But,   this   person   is   hard   to   find,   expensive,   and   also   has   limited   localized   knowledge   of   the   Brazilian   market.   Instead   they   decide   to   use   prosourcing.   The   prosourcing   marketing   platform   locates   marketing   ‘pros’   in   Brazil   that   have   localized  knowledge  of  the  wine  industry.  It  allocates  marketing  tasks  to  various  ‘pros’   and   manages   the   work.   The   result   is   an   increase   in   Brazilian   web   traffic   on   the   winemaker’s  website  and  a  stronger  brand  presence  in  Brazil.  Prosourcing  allowed  this     winemaker  to  move  into  the  Brazilian  market  with  little  effort  or  capital.   Figure  15:  Prosourcing   5.2. CONCLUSION     An   internal   team   is   still   critical   to   business’   success,   but   the   hiring   landscape   has   changed.   More   and   more   business   processes   are   being   outsourced.   A   two-­‐person   start-­‐ up   can   now   complete   necessary   business   tasks   without   hiring   a   huge   internal   team.   They   can   outsource   operations   to   skilled   labor   that   complete   these   tasks   more   efficiently   and   at   much   lower   prices.   These   processes   used   to   be   outsourced   to  specific     63  
  • 64. third  parties,  then  there  was  crowdsourcing,  now  there  is  prosourcing.     Prosourcing  is  the  next  step  in  outsourcing.  It  generates  professional  profiles  based  on   social  data  and  uses  this  information  to  match  skills  with  business  tasks.  By  allocating   and   matching   labor,   prosourcing   provides   a   stronger   outsourcing   option   and   more   complete  hiring  solution.   Ideally   this   prosourcing   trend   will   continue   to   evolve,   ultimately   creating   a   universal   hiring  marketplace.   This  marketplace  will  contain  comprehensive  resumes  for  every  available  labor  option.   Companies  will  no  longer  have  to  post  various  job  ads,  hire  a  recruiter,  or  search  various   employment  websites.  Instead  they  will  have  complete  access  to  the  labor  pool  and  can   easily   search   to   find   their   ideal   candidate.   Workers   will   be   better   matched   with   positions   they   are   passionate   about   and   companies   will   get   better   access   to   ‘pros’.   Prosourcing  is  the  first  step  towards  building  this  universal  more  effective  ecosystem  of   hiring.   The   prosourcing   space   is   still   in   its   infancy   and   will   continue   to   evolve   and   grow.   To   follow   this   evolution   you   are   encouraged   to   visit   prosourcing.org   -­‐-­‐   the   new   home   for   everything  prosourcing.             64  
  • 65. 6. CONCLUSION       It   is   now   largely   agreed,   at   all   levels   that,   from   amateurs,   non-­‐profit,   businesses   and   also  institutional  organizations,  crowd  phenomenon  is  not  temporary.  It  is  a  reality!  The   challenge  it  now  to  come  to  terms  with.   Crowdsourcing,   which   plays   an   essential   role   for   the   advancement   of   profit   generation,   gives  great  opportunities  but  it  also  causes  damages  if  the  risks  are  not  well  handled.  Its   threats  must  be  carefully  taken  into  account.     This   exploratory   study   allowed   visualizing   the   major   stakes   of   crowdsourced   business   models,  which  led  us  to  identifying  new  theoretical  insights  and  highlighting  concrete   problems   as   they   appeared.   Before   taking   on   crowdsoucing   a   firm   should   definitely   consider  studying  how  crowdsourcing  contributes  to  its  activity  and  study  the  viability   of  its  use.     In  this  report,  we  tried  to  identify  ways  of  improving  crowdsourced  business  based  using   the  results  and  data  from  the  current  experiment  as  example  data.  Both  Capseo  and  I   were   engaged   in   a   mutual   learning   process   in   building   a   new   type   of   business   model,   Prosourcing.  The  uniqueness  of  this  type  of  makes  it  a  starting  point.    There  are  many   potential  options  for  future  work  of  using  groups  of  individuals  with  appropriate  domain   expertise  and  motivation     As   V.   Chanal   &   M.   Caron-­‐Fasan   concluded   in   their   paper   “The   Difficulties   involved   in   Developing   Business   Models   open   to   Innovation   Communities:   the   Case   of   a   Crowdsourcing   Platform”   (2010):   The   business   model   is   more   of   an   ongoing   learning   process  than  a  final  result  to  be  implemented  through  a  business  plan.                   65  
  • 66. 7. APPENDIX     [1]     The  rise  of  crowdsouring  –  Wired  magazine  –  by  Jeff  Howe    2006   http://www.wired.com/wired/archive/14.06/crowds.html           66  
  • 67. [2]  Crowdsourcing  Landscape         67  
  • 68. [3]  Crowdsourcing  Timeline         68  
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