Enterprise Crowdsourcing 10xProcurement
- In 1567, King Philip II of Spain offered a reward to anyone who could devise a simple and practical method for precisely determining a ship’s longitude at sea. In 1714, the British government established the longitude rewards… the top prize of £20,000 would be worth £2.5 million today.
- 85% of the top global brands have used crowdsourcing in the last ten years @eYeka
- By 2018, 75% of the world’s high performing enterprises will be using crowdsourcing @Gartner
- Founded in 1995, XPRIZE is the leading organisation solving the world’s Grand Challenges by creating and managing large-scale, high-profile, incentivised prize competitions in five areas: Learning, Exploration, Energy & Environment, Global Development and Life Sciences. Active prizes include the $30M Google Lunar X PRIZE, $10M Qualcomm Tricorder XPRIZE, $2.25M Nokia Sensing XCHALLENGE, $2M Wendy Schmidt Ocean Health XPRIZE and $15M Global Learning XPRIZE.
- The earnings of successful crowdsourcing challenge participants can now easily exceed $500,000 per annum @Topcoder
It is widely recognised that crowdsourcing is now reaching industrialisation with solutions now both aggregating the wisdom of the crowd eg eYada, InnoCentive, Kaggle and Topcoder to simply finding the best person to fulfil a specific task like Gigwalk, Upwork, 99Designs, Streetbees and Writology.
Value can be derived from a multitude of different sources…the difference now is speed, quality, access, innovation and cost are all significantly improved. This is 10xProcurement.. an opportunity for Procurement to improve by (at least) 10 times.
- Faster design and prototyping — DARPA crowdsourced its next-generation amphibious fighting vehicle in 6 months
- Higher quality — Allstate created a liability prediction model that was 271% more accurate than the original
- Greater elasticity — CrowdSource allows retailers to respond to market changes with more agility and speed
- Appetite for tedious task — TaskRabbit allows simple tasks to be completed for money by anyone in the crowd
- Access to new pools of external talent — SpringRole is the ‘TaskRabbot’ of recruiting
- Learning — “Crowds are energised by intrinsic motivations, such as the desire to learn or to burnish one’s reputation in a community of peers” Kevin Boudreau and Karim Lakhani
- Better engagement and retention of internal talent — Thomson Reuters uses crowdsourcing to access the skills of its 17,000 technologists
- Lower cost — Colgate Speed Stick created their Super Bowl advert for $17,000
The Right Crowd
Choosing the right crowd and its application within your enterprise is important to maximise the benefits with options ranging from crowd collaboration and crowd labour to crowd funding, crowd voting and crowd curation. In simplistic terms for procurement that may mean the crowd curation of supplier directories or indeed supply chain risk eg Sourcemap to maximising the use of crowdsourcing tools in sourcing and the use of supplier networks and platforms eg Tradeshift, Ariba Supplier Network, Coupa and Amazon.
During the Procurious Big Ideas Summit, we spoke about Intelligent Collaboration Ecosystems (ICE) … this is just the beginning for companies and their suppliers. Geolocation and low-cost mobile applications make it easy for smart people everywhere to participate — by 2020 there will be over 5 billion internet users.
A connected workforce, a connected supply base and 10xProcurement amplified and accelerate by crowdsourcing.
To find out more about the new opportunities, greater choices and bigger rewards that crowdsourcing and open innovation can provide you and Procurement feel free to contact me at email@example.com