A friend of mine at Business school would always say that he could sum up the entire education he received from the school into this single pithy concept: ‘Risk vs. Reward’! Each balances the other out, and of course, the greater the risk taken, the higher the rewards would prove!
With technology offering tremendous opportunities to break all barriers to information dissemination, some companies have become aggressively experimental in sourcing their workforces from around the world. We see crowdsourcing, or “WaaS” (Work as a Service), taking center stage. Crowdsourcing offers great opportunities to advertise and source unique skills, resolve strategic problems, scale up to handle voluminous tasks or creative output and gain insight into users’ minds by attracting inputs, reviews and feedback.
Talent Exchanges like Elance, oDesk, Amazon Mechanical Turk, Kaggle, Innocentive, and CollabWorks have all put processes in place to streamline such arrangements. In addition, many companies are venturing out on their own to attract the crowd to contribute directly to their efforts. Crowdsourcing is a whole new merging option with its own attractions and pitfalls.
Employment regulations have not yet explicitly addressed the various nuances of the employer-worker relationships being established through crowdsourcing. The very definition of a “worker” is being challenged. In the “talent exchange” model, a company posts an assignment, individuals bid on the assignment, the company selects a worker, and the individual then begins the assignment. The individual is compensated as an independent contractor. In other crowdsourcing models, individuals are asked to contribute ideas in a collective effort to create a ‘product’. Under what conditions are the participating individuals considered “workers”? These and other unforeseen complications will undoubtedly require legislative intervention.
We make an attempt here to identify some complications that could arise out of crowdsourced ventures:
Remunerating the Contributors: Software programs like Linux and resources like Wikipedia enjoy crowdsourced contributions, with no mention of any pay because their services result in deliverables that are in the public domain. Yelp used the contributions of the crowd to build deliverable available for a fee paid to Yelp. , All that the contributors and reviewers got were titles – followed by the inevitable lawsuit, which will hopefully set the precedent for such ventures in the future.
Protecting Intellectual Property: Paid or unpaid, short-term or long; contributions from the crowd could generate intellectual property, which will need to be assigned to the right owner. In an employer-employee relationship, or in a relationship in which a contingent worker is placed by a staffing agency, contractual agreements specify the owner of all intellectual property created through the agreement. When ideas are crowdsourced – in the form of design competitions and other challenges – ownership is usually unclear. Giving away ideas to the crowd, to see one or more of them attributed to someone else, is not an ideal situation. Similarly, awarding a huge prize to someone only to find that the idea was sold to others in the business or plagiarized from a little known source could create serious problems to any business and the disputes could prove to be equally difficult to resolve.
Control and Management: The size of the online environment could prove daunting. Companies must establish processes and devote resources to manage a potentially unlimited number of participants. Most companies have very limited experience with crowdsourcing as a tool for accomplishing tasks, and best practices for incorporating this technique into standard work processes are virtually non-existent. The output may prove disjointed and useless without the right level of oversight. It must be remembered that a lot hinges on the execution.
Risks Involved: Few companies have established a policy or guidelines governing the use of crowdsourcing to procure workers or ideas. The “coolness factor” associated with crowdsourcing may entice business managers to pursue this approach without the experience and guidance needed to protect the interests of their employer. When crowdsourcing workers, businesses face concerns with the low quality of work submitted against payments already made into escrow accounts. When the crowdsourced resource is engaged to complete a project as an independent contractor, who will perform background checks and other actions normally taken to protect the company? Will the agreement between company and worker protect against misclassification claims? Workers also face risks. They may find themselves providing services for low or no remuneration, if they are not careful and lack an intermediary who protects their interests.
Forewarned is always forearmed, and being aware of the possible complications in crowdsourcing could only help with formulating the strategy behind your move to adapt it for your business.
Mail (will not be published) (required)
× one = 7
Thanks for Subscribing to DCR Blog.