Leveraging collective intelligence: How to design and manage crowd-based business models
Section snippets
Crowds as value creators: New possibilities
Practitioners and researchers increasingly have identified crowdsourcing as a viable strategy to gather creative ideas and solutions, make decisions, and outsource small tasks (Prpić, Shukla, Kietzmann, & McCarthy, 2015). So far, the focus has been primarily on how firms can capture the aggregated wisdom of the crowd (Surowiecki, 2005) for their business challenges. Over recent years, however, firms from different industries have started to develop new business models that fundamentally
Measure to manage: What is the crowd's value to the firm?
While CBBMs can be highly effective, the decision to implement such a business model needs to be complemented with a thorough analysis of the crowd's potential value to the firm. Moreover, managing a CBBM requires an understanding about the optimal size of the firm's crowd. To achieve this, managers of CBBMs need to decide whether a further increase in the crowd's size will lead to more value creation to customers and ultimately more value to the firm. The crowd's value to the firm can be
Four practices for creating superior value for the crowd
According to the crowd capital perspective, firms are benefiting from crowdsourcing when they successfully build the capabilities for acquiring and assimilating crowd members and harnessing crowd capital (Prpić et al., 2015). Similarly, building a sustainable CBBM requires mechanisms that attract and engage crowd members who will contribute long-term to the firm. Being in a competitive situation when it comes to assembling crowds, companies must develop a clear value proposition to attract
Five tactics for capturing more value from the crowd
The third managerial challenge consists of actually capturing the value from the crowd's contributions. This relates to the third step in the crowd capital framework: harnessing the crowd capital. The analysis of the presented CBBMs suggests that managers use common mechanisms and practices to capture more value from crowds: (1) create complementarities between crowd contributions, (2) turn crowd members into firm ambassadors, (3) foster entrepreneurial behavior in crowd members, (4) manage
Final thoughts
CBBMs extend the usefulness of crowdsourcing by building an entire value logic around crowd contributors that directly influences the customer experience. This logic goes beyond the idea of an aggregated ‘wisdom of the crowd’ by acknowledging the individual skills and expertise of every crowd member. In this article, I have advanced the understanding of crowd-based business models, aiming to sensitize managers in favor of a more analytical approach to designing and managing CBBMs. While crowds
References (38)
Giving gifts to groups: How altruism depends on the number of recipients
Journal of Public Economics
(2007)- et al.
What can crowdsourcing do for decision support?
Decision Support Systems
(2014) - et al.
Crowd science: The organization of scientific research in open collaborative projects
Research Policy
(2014) - et al.
Whom should firms attract to open innovation platforms? The role of knowledge diversity and motivation
Long Range Planning
(2011) Crowdsourcing: A revised definition and an introduction to new research
Business Horizons
(2017)- et al.
Social media? Get serious! Understanding the functional building blocks of social media
Business Horizons
(2011) - et al.
How open source software works: “Free” user-to-user assistance
Research Policy
(2003) - et al.
How to work a crowd: Developing crowd capital through crowdsourcing
Business Horizons
(2015) - et al.
Is it all a game? Understanding the principles of gamification
Business Horizons
(2015) - et al.
Game on: Engaging customers and employees through gamification
Business Horizons
(2016)
Business models, business strategy, and innovation
Long Range Planning
Crowdsourcing in a time of empowered stakeholders: Lessons from crowdsourcing campaigns
Business Horizons
Crowdsourcing new product ideas over time: An analysis of the Dell IdeaStorm community
Management Science
Negative intra-group externalities in two-sided markets
International Economic Review
Let a thousand flowers bloom? An early look at large numbers of software app developers and patterns of innovation
Organization Science
Unpaid crowd complementors: The platform network effect mirage
Strategic Management Journal
When does a platform create value by limiting choice?
Journal of Economics and Management Strategy
Strategies for two-sided markets
Harvard Business Review
Cited by (43)
A social selection mechanism for sports betting market
2024, Decision Support SystemsInnovation intelligence in managing co-creation process between tech-enabled corporations and startups
2023, Technological Forecasting and Social ChangeCitation Excerpt :First, this research extends the literature on technology entrepreneurship, emphasizing on impact of digital technologies on collective intelligence (Elia et al., 2020b). Adopting a lens of innovation intelligence, this study proposes accessing and fortifying collective intelligence by probing the mechanisms of partially virtual community (co-presence of partners and contributors) as a co-creation space of corporate and startup; whereas most of the previous research (Dellermann et al., 2020; Elia et al., 2014; Elia and Margherita, 2016; Elia et al., 2020b; Mačiuliene and Skaržauskiene, 2016; Margherita et al., 2020; Täuscher, 2017) focus on the digital- environment as a wholly virtual community (glob and unlimited participants) which are designed to leverage collective intelligence based on the goals of different stages of entrepreneurship. Second, it gives a better understanding of open innovation by deeply explaining the co-creation process between corporate startups.
The crowdfunding model, collective intelligence, and open innovation
2021, Journal of Open Innovation: Technology, Market, and ComplexityCo-making the future: crafting tomorrow with insights and perspectives from the China-U.S. young maker competition
2024, International Journal of Technology and Design EducationSystematic Literature Review in Reshoring Strategies 4.0
2023, LogisticsSafeguarding Crowdsourced Contributions
2023, SSRN