8 Big Crowdsourcing Mistakes

March 9, 2016 By Paul Wagorn


8 big crowdsourcing mistakesCrowdsourcing and open innovation can be powerful tools.  Throw out a problem, and a solution bounces back – usually quickly, and for a relatively low cost.

Then why is it that so many companies fail to get everything out of crowdsourcing that they had hoped for?  The majority of the time it’s because they make critical mistakes.

Here are some of the mistakes that companies make when they try to engage in crowdsourcing. Getting these right will make the difference between a successful crowdsourcing program, and one that fails to excite stakeholders:

1.  Betting it all on red.

Like smart investing, crowdsourcing works best from a portfolio approach.  Some projects will succeed, some will fail.  Do not be afraid of failure – expect some projects to fail, but the ones that succeed will make the failures pay off.  Instead of investing too much time and expectations into one high-value project that will make or break your open innovation efforts (and possibly your department!), Run 10 small, fast ones in the same amount of time.  Run 20.   Shots on goal count.  Even if you get only three or four wins, you’re still much farther ahead than if you didn’t try.  Discoveries come from unexpected places – build a vehicle for that to happen.  If you only use crowdsourcing for pet/“high value” projects, you’re missing the power of what it can do.

Like any new tool, the first few times you might not get the results you want, but think of it as a learning process.  The first pancake isn’t always the best one, nor will your first crowdsourcing effort be.  It’s a learning process that has a very big payoff when you get it right.

 2.  Doing it yourself.

When companies create a mandate to invest in open innovation and crowdsourcing, they often make the mistake of thinking that it’s simple to execute, and in most instances, it’s not.   You will need to develop:

  1. An audience. To crowdsource successfully, you need a crowd, and not just any crowd, but one that has expertise, experience, is motivated, and above all, engaged. You will need to maintain the crowd, cultivate it and provide enough for them to do to stay interested.
  2. Legal agreements. What will happen with intellectual property?  How is confidential information treated?  How do you deal with Ideas?  What about the nightmare that some companies have gotten into with university IP?  How do you protect yourself from seeing confidential information unintentionally?
  3. A balance. How much can you ask from people before you start needing to pay?  What will incentivize them, what will excite them?  Motivation of crowds is full of complexity and nuance.  Not all participants engage in crowdsourcing for the same reasons – are you addressing all their motivations, or are you leaving an entire group out of the mix?  People participate for all sorts of reasons, such as for the challenge of working of a difficult problem,  interacting with other very smart people (if it is a team challenge), networking opportunities, intellectual curiosity, building their reputation, and of course financial reward.
  4. A platform. You will need to advertise your need, and provide a platform for receiving submissions.   This platform needs to work properly, ask for just the right amount of information and speak to your target audience.  Registration must be simple.

Getting all of these things just right is critical, and being off target on just one of these things may make or break your program.  There are companies such as IdeaConnection that already have all of these things in place, such as a motivated crowd, legal agreements, a successful platform, plus has a process that executes projects quickly and effectively.   Instead of making major errors, use someone who has worked with many companies to help them avoid these mistakes, and has already executed many successful campaigns.

3.  Setting unrealistic goals.

To maximize the value you get from crowdsourcing, it is crucial that you are clear on what you want, and calibrate your expectations to a realistic goal.  What is your best case scenario?  What is the minimum that would give you value?  Sometimes a simple insight can turn an insurmountable problem into something that you can work with.

If you set your goal too high (“complete technical drawings and/or prototypes for our new product”), you might leave some really creative ideas on the table.  If you set the bar too high, you restrict the scope of people who will participate.   Go for what you really need, instead of what you wish you could get.

 4.  Not involving all stakeholders. (The nay sayers)

There will be people at your company who have already decided that this won’t work.  The key is to involve them from the beginning.  Get their input, have them help with the project – get their buy-in and get them involved.   (When implementing a successful open innovation department  fails, you can often find someone in the company who expected or even wanted it to fail)

The level of engagement, excitement and creativity from your crowd will be a direct reflection of the level of enthusiasm that they see from the people on your team.  The more enthusiastic you are, the better results you’ll get.  Be responsive, answer questions promptly and eagerly – show them that you want a solution and that you’re excited to work with the crowd, and it will pay off.

This also includes securing funding and buy-in from upper management – make sure the project is funded not only for the generation of ideas, but also for the follow-through of those ideas.

 5.  Not following through.

This one is tough.  Typically, the best evangelist for carrying the torch across the finish line for an idea is the person who actually came up with the idea.  One of the challenges in crowdsourcing is that the person with the idea isn’t part of your company –this means that that you need to develop a strategy for following through with the ideas.  The conclusion of the crowdsourcing project is just the beginning – make it someone’s responsibility to evangelize the idea through to completion, because without this concerted effort, it will die.  Have regular follow-up sessions.  Incentivize people for developing ideas, regardless of where they came from.

6.  Getting your audience wrong.

Is your audience retail consumers?  Is it academia?  Garage tinkerers?  Seasoned veterans? Make sure your audience is aligned with the goals of your project.   Too many times I have seen a company in an industry such as consumer goods ask their retail target audience for solutions, and then complain about a poor signal-to-noise (i.e. junk).  Make sure your audience is targeted – if the majority of your technical solutions come from research scientists, then make sure you are asking this group.  Above all, make sure that you are motivating your audience based on what they care about – not everyone is motivated by a licensing deal or money.

At the same time, do not underestimate the wisdom of a quality network of problem solvers.  Many companies do not wish to admit this, but some of the smartest people do not work for your company.  Crowdsourcing gives you the opportunity to connect with some of these very bright people – if you treat them fairly and with respect, you will be harnessing a powerful resource.

 7.  Not knowing what you can say.

Open innovation and crowdsourcing is all about reaching out to people outside your company.  Be prepared for difficult questions – ones that probe at the very nature of you r product, strategy, and plans.  To solve a problem, the root cause must be identified.  If you have staff that will be interacting with participants, Make sure that they are 100% clear on what they are able to discuss.   There is nothing for frustrating for participants in a crowdsourcing project than to be dealing with someone who does not have the ability to determine what they can and cannot say, because most employees will err on the side of saying nothing, and that isn’t going to help you solve your problem.

 8.  Assuming that it all has to be public.

If the project truly is confidential, know that there are options for confidential crowdsourcing.   Our company has built a whole model on using crowdsourcing just as a first step to hand pick participants for multidisciplinary teams that have all signed two levels of NDAs: one when the first join IdeaConnection, and another for each specific project.  Sometimes the best way is to run a confidential challenge – this way, you can share a lot more information, and the more information you can give, the better chance that your problem will end up solved. IdeaConnection has successfully solved hundreds of challenges and transferred the IP of each solution to the client- and none of these problems or solutions are public.

Crowdsourcing can be a very powerful tool for your company.  It can help you expand the scope of your discovery engine, it can turn you on to new ideas, and it can solve critical product development challenges, and most at a lower cost than traditional R&D.

Your open innovation group needs to show success to survive.

If you avoid making these common mistakes, you and your team will be much better positioned to help your company make a breakthrough that can have a real impact on your company’s future.

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