Thanks for the great comment and feedback. I’m glad you’ve enjoyed the posts so far. As you stated, the challenge is, like in most new fields, to look beyond the novelty and explore how you can identify, deliver and measure the results.

If you have any suggestions for a future post, feel free to contact me and we can it discuss over a real (or virtual) beer or two.

You make some very good points. I do agree that it is much easier for companies (small and large) to experiment given the tools and platforms now available. Your addition of the word “potentially” is well placed since it’s not just the tools available, but the experience and knowledge that comes along with it. Experimentation is all well and good, but that doesn’t immediately translate to consistent measurable results.

I also like your breakdown of the crowd, platform and cost as well. Regarding the crowd, I agree that the company may have a larger, more diverse crowd, but they might not have the skills needed depending on the tasks required by the company. This is where I think some companies hit bumps in the road. They assume that a large crowd equals a diverse crowd. It may be the case that your crowd is comprised of your greatest fans, but not the best skill sets for the job.

Thanks for the great comment.

Thoughtful post. I think this reflects a general dynamic, much like the adoption distribution you mention, where companies will experiment with taking services that they buy and attempt to build because it is (or appears to be) either a) cheaper and/or b) possible to improve upon if brought under the auspices of internal resources.

I also think crowdsourcing is ripe for this type of experimentation since the same properties that make it relatively easy for a start-up to create a platform also make it (potentially) easy for a firm with sophisticated internal resources to duplicate (if not improve upon) the commercialized version.

The key to firms that will continue to monetize their service and thrive, rather than be replaced by firms’ internal resources, will be their ability to provide differentiated and proprietary value. Three areas that come to mind that likely would tip the balance from “build” to “buy”:

1) Crowd: it could be that a company has a larger, more diverse, better quality crowd given the area of interest–one that cannot easily be duplicated

2) Platform: possibly the platform for accessing the crowd is beyond what a firm could create in-house. Maybe the bells and whistles include proprietary technology for efficiently managing crowds and projects, providing payment, ensuring QA amongst the crowd and for a particular project, etc.

3) Cost: if the crowdsourcing firm has created a platform that allows for more cost-effective crowdsourcing (even with their profit margins and mark-up) then most firms will choose to buy, unless their technology need is so specific (and difficult to produce) that no vendor can provide it. Firms always have to take into account the opportunity costs of building vs buying, so it isn’t just the raw costs of contracting with a vendor, but also what the internal bandwidth will (or will not) allow.