Problem Statement
According to the U.S. Council on Competitiveness (2008), we are in the midst of a “radically and irrevocably” changing global competitive landscape. The speed of change within the marketplace combined with increased global competitiveness and the changing nature of innovation are forcing companies to reexamine traditional approaches to product and service innovation. This, combined with the increasing pace at which companies must innovate to remain competitive, is resulting in a gap between a firm’s ability to generate continuous product and service innovation and the market’s demand for such innovation. This has been referred to as the “innovation “gap” (Ketchen, Ireland, & Snow, 2007) or the “innovation crisis” (Nambisan & Sawhney, 2008).
Many companies looking to manage the changing innovation landscape and narrow their innovation gap are attempting to harness the collective intelligence of the crowd by leveraging technology to open up the innovation process in new ways (McAfee, 2009). Often referred to as “crowdsourcing” (Howe, 2006), a company’s ability to tap into the crowd may be key to our nation’s ability to remain competitive in today’s fast moving economy.
While companies both small and large are experimenting with crowdsourcing, we are only just beginning to understand the strategic uses of the crowd for product innovation. Clearly understanding the key characteristics of crowdsourcing in relation to other theories of open innovation will be critical in developing and extending theory related to this new phenomenon as well as providing guidance to corporations who wish to implement such initiatives (Sawhney et al., 2005; Trompette et al., 2008).
Research Questions
My research seeks to: 1) to expand our current understanding of how the crowd is being used to supplement or replace current product/service innovation practices, 2) to build explanatory theory with the purpose of identifying key characteristics that manifest themselves in crowdsourced product/service innovation, and 3) to identify similarities and/or difference among crowdsourcing and other open innovation practices. Within the context of this research, the term “crowd” refers to individuals both inside and outside the company whose primary responsibilities does not include product or service innovation.
Two broad outcomes are anticipated. First, patterns and themes found in crowdsourced innovation will be identified to provide a deeper understanding of 1) motivations of companies for turning to the crowd, 2) the tasks the crowd is being asked to perform, 3) how the crowd’s input is being incorporated into current innovation processes, and 4) perceived value. Second, an explanatory theoretical framework will be created with the purpose of uncovering relationships among relevant characteristics and to compare and contrast crowdsourcing to current open innovation practices.
Information for Interested Companies
To examine the impact of crowdsourcing on organizations, companies with established innovation processes in place who are also leveraging the crowd via online social media tools for product or service innovation are desired. Participation will consist of both interviews with executive leadership as well as with product innovation teams regarding current crowdsourcing initiatives and product development processes. Additionally, were available review of company documents related to product development processes and projects may be requested.
For those companies willing to participate a report summarizing insights on industry trends, business models, success metrics, and potential organizational impacts will be provided. All findings will be anonymized to protect the privacy of participating companies and individuals within the company.
Conclusion
Currently it is unclear whether the advantages of leveraging the crowd for product innovation out weight the disadvantages. We know little about whether crowdsourcing represents a new form of open innovation that holds promise for US companies. Key to our understanding moving forward is clearly defining the phenomena of crowdsourcing in relation to other types of more traditional innovation practices, as well as building an understanding of what factors motivate companies to turn to the crowd, how companies can extract value from turning to the crowd, and the impacts of such initiatives on these organizations.
References
Ketchen, D. J., Ireland, R. D., & Snow, C. C. (2007). Strategic entrepreneurship, collaborative innovation, and wealth creation. Strategic Entrepreneurship Journal, 1, 371-383.
McAfee, A. (2009). Enterprise 2.0: New Collaborative Tools for your Organization’s Toughest Challenges. Boston, Massachusetts: Harvard Business Press.
Nambisan, S. & Sawhney, M. (2008). The global brain. Your roadmap for innovating faster and smarter in a networked world. New Jersey: Pearson Education.
Sawhney, M. Verona, G., & Prandelli, W. (2005, Autumn). Collaborating to create: The Internet as a platform for customer engagement in product innovation. Journal of Interactive Marketing, 19(4), 1-14.
Trompette, P., Chanal, V., & Pelissier, C. (2008). Crowdsourcing as a way to access external knowledge for innovation: Control, incentive and coordination in hybrid forms of innovation. Proceedings of the 24th EGOS Colloquium.
U.S. Council on Competitiveness. (2008, October). Compete: New challenges, new answers. Washington, D.C.: Author.
