Q2: Read the case study and answer the question.

Introduction

Crowdsourcingasking an undefined group of external contributors to work on tasksallows organizations to tap into the expertise of people around the world. Crowdsourcing is known to increase innovation and loyalty to brands, but many organizations struggle to leverage its potential, as our research shows. Most often this is because organizations fail to properly plan for all the different stages of crowd engagement. Take the case of the Canadian mining company GoldCorp. Its mines seemed to have run dry, and its CEO decided to pursue a novel path in the form of crowdsourcing. In the process, he reshaped the companys approach to discovery. They started a crowdsourcing initiative asking external contributors where to drill, and the crowd detected new ways of finding gold previously unknown to GoldCorp. The end result was a skyrocketing share price and the additional discovery of a different kind of goldpreviously unknown talent that was subsequently hired.

Organizational Design Problems of Crowdsourcing

Problem 1: managing crowds involves multiple steps

A problem we observed repeatedly is that companies want to use crowds to get ideas, but they fail to organize for crowdsourcing. A key challenge is that it involves various decisions with complex interdependencies. We have summarized the process into four main steps: (1) define the task to be completed; (2) broadcast to a pool of potential contributors; (3) attract a crowd of contributors; and (4) select among the input received. Think of the interdependencies between these stages. If you define the task too broadly, then it has significant implications for the types of people who engage, the size of the crowd, and the challenge of sifting through the submitted ideas. This makes a simple task suddenly tricky, because interdependent decisions cannot be made in isolation. A key challenge beyond interdependence is irreversibility. Once the crowdsourcing initiative is configured and has been broadcasted, it is very difficult to adjust, as external contributors start engaging on building the current configuration. Thus, when an organization decides to configure one aspect of their crowdsourcing initiative in a particular way and afterward realizes that doing so requires another aspect, it may be unable to adjust. This challenge of irreversibility is exemplified by the experience of the Natural Environment Research Council, which in March 2016 announced a plan to tap into the crowd for a name for their next polar vessel. The task was poorly designed from the beginning: previous suggestions were visible to the contributors, leading to a herding effect, which eventually led to the jokingly number one nominated suggestion Boaty McBoatface. Once the mediatraditional and socialgot hold of it, it was difficult to withdraw. An implication for organizational design is to outline the different steps in the process and to outline interdependencies between the steps. This sounds like commonsense, but many organizations fail to appreciate the downstream implications of, for instance, vaguely defining the problem. Thompsons (1967) classical notion of reciprocal interdependence can be used to illustrate this. Reciprocal interdependence is more complicated than sequential interdependence where the output of one unit becomes the input of another, as it is cyclical. A similar form of reciprocal interdependence occurs in crowdsourcing, with the added difficulty that resolving the coordination through information sharing and mutual adjustments is harder when the involved parties transcend a single organization. From this follows that organizations could outline the process carefully when initiating crowdsourcing, and consider possible interdependencies to avoid future coordination problems.

Problem 2: building a crowd

Our research has used data from thousands of different organizations to document the challenge inherent in building a crowd. Rather than seeking to develop innovations, these organizations turned to crowdsourcing merely to articulate concerns and ideas. We found that it is difficult to build a crowd even when there are low participation barriers. For each successful crowdsourcing initiative such as Dell IdeaStorm or Starbucks ideas, there are plenty of cases where an organization never manages to build a crowd. Some 90% of organizations in our sample collect less than one idea per month. In other words, success stories can be deceiving. Focusing exclusively on initiatives that reach a certain stage can lead to partial or erroneous conclusions about the lack of challenges in crowdsourcing, as well as about why some organizations manage to build a crowd while others fail.

Our research points to strategies that can be used to increase the odds of building a crowd. One reason for sharing suggestions is to get feedback from peers and firms (Jeppesen and Frederiksen 2006; Bogers et al. 2010). In our research, feedback was given publicly with more or less specified feedback. Our work shows crowds are more likely to grow when companies use proactive attention (the extent to which the organization push the direction by posting own suggestions) and reactive attention (whether ideas posted receive feedback from the company (Dahlander and Piezunka 2014). In other words, receiving feedback from organizations increases the likelihood of those organizations building a crowd. In addition, the effect is larger when an organization is active in the beginning in the formative phase of the crowd. This is because it is important to weave in newcomers and get them attached to the crowd. Unfortunately, this stands in contrast to what many organizations do: they are only willing to invest their time and attention if the crowd has reached a more critical threshold. Our findings also suggest that organizations are well served by giving feedback to newcomers who show up the first time rather than people who are already well-integrated. Companies often neglect newcomers, as they are more concerned about their core members. This is unfortunate as it is a missed opportunity to grow the crowd.

Question2. The role of the organization is thus to cultivate these crowds. This, however, often implies that the organization that turns to the crowd must devote resources, time, and attention to managing it. How will you solve the above problems by using the organization theory and design? Provide reasoning. (500 words)