On paper, crowdsourced innovation makes a lot of sense: If two heads are better than one, why not 20,000? Surely, some of those outsiders will have fresh solutions to your problem. But in practice, such programs have often not worked out as well as hoped. More often than not, even the best crowdsourced ideas disappear in a Bermuda Triangle of logistical difficulties, internal politics, and professional insecurity. The International Committee of the Red Cross has developed a new collaborative approach to crowdsourcing ideas that limits the competition to teams. It designed its Enable Makeathon project not only to generate good ideas of products to help people with disabilities but also to make sure those ideas reach the market

Acar, O. A.

Brunneder, J.

Deichmann, D.

Sarwal, T.

English

Brunneder, J

Acar, O A

Deichmann, Dirk

Sarwal, T

EUR Research Repository

A new model for crowdsourcing innovation

City Research Online

              City, University of London Institutional RepositoryCitation: Acar, O. A. ORCID: 0000-0003-1993-0921, Brunneder, J., Deichmann, D. and Sarwal, T. (2020). A New Model for Crowdsourcing Innovation. Harvard Business Review, This is the published version of the paper. This version of the publication may differ from the final published version. Permanent repository link:  https://openaccess.city.ac.uk/id/eprint/23629/Link to published version: Copyright and reuse: City Research Online aims to make research outputs of City, University of London available to a wider audience. Copyright and Moral Rights remain with the author(s) and/or copyright holders. URLs from City Research Online may be freely distributed and linked to.City Research Online:            http://openaccess.city.ac.uk/            publications@city.ac.ukCity Research Online31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 1 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationINNOVATIONA New Model for CrowdsourcingInnovationby Johanna Brunneder, Oguz A. Acar, Dirk Deichmann, and Tarun SarwalJanuary 31, 2020dorian2013/Getty ImagesOn paper, crowdsourced innovation makes a lot of sense: If two heads are betterthan one, why not 20,000? Surely, some of those outsiders will have freshsolutions to your problem. But in practice, such programs have often not31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 2 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationworked out as well as hoped. More often than not, even the best crowdsourcedideas disappear in a Bermuda Triangle of logistical difficulties, internal politics,and professional insecurity.A case in point is the crowdsourcing experiment of the VDMA, an industrialassociation that represents over 3,200 German mechanical engineeringcompanies. VDMA identified six unresolved technical challenges facing itsmembers and initiated an open, global call for solutions. The initiative yieldeddozens of feasible ideas for tackling different challenges. Yet in the end, itsmembers adopted none of them. All 3,200 organizations refused to use anysolution that was not invented internally.NASA experienced even stronger reactions when it tried experimenting withexternal crowdsourced innovation: Some scientists found the initiative to be anaffront. After all, they had joined NASA to address interesting challengesthemselves.Even when companies are more open to outside ideas, turning an idea into amarketable solution takes many additional steps, most of which are hard tonavigate. One measure of just how hard they are is the failure of Quirky, astartup focused entirely on crowdsourced inventions. It filed for bankruptcy in2015, partly because the company never developed a system for scaling itsinventions into production.To avoid this kind of slip between invention and implementation, theInternational Committee of the Red Cross (ICRC) has developed a new approachto crowdsourcing ideas. It designed its Enable Makeathon project not only togenerate good ideas of products to help people with disabilities, but also to makesure those ideas reach the market.31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 3 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationSo far, it’s gone well. The Enable Makeathon has led to the development of anumber of promising startups, including:Mobility, a startup that sells a low-cost chair designed to help correct theposture of children with cerebral palsy.AskBlee, a sign-language question-answering service for India’s 65 milliondeaf people.Amparo, developers of the Confidence Socket, a new kind of attachment forlower-leg prosthetics that is easier to fit and more comfortable to wear.Torch-It, a manufacturer of a virtual cane for the blind that gives theminformation about the distance and identity of obstacles up to 10 or 11 feetahead.To avoid what happened to VDMA, NASA, and Quirky, the ICRC realized that itwould need to address internal skepticism about crowdsourced ideas upfront.This meant that the role of the external crowd had to go beyond “the fun part” ofsimply generating ideas. The inventors would need to participate in the scalingup of the idea.Every startup veteran knows that the idea is only the beginning. Bringing aproduct to market requires a number of additional, equally important steps —many of which are not easy for an established organization to take, particularlywith a truly groundbreaking product.This was doubly true in the case of the Red Cross, because it’s a health andhumanitarian services NGO, not a manufacturer. ICRC executives realized thatalthough the organization was in a good position to lead a contest for inventionsto help the disabled, it did not have the right internal capabilities to furtherdevelop those ideas and take them to market. To overcome this obstacle, it31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 4 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationneeded to invent a new kind of innovation initiative that not only sparkedcreative proposals but also turned them into practical products that would reachunderserved and often overlooked markets.To tackle these challenges, the Red Cross collaborated with organizations with astake in the problem in question to fill the expertise and resource gaps in theinnovation chain and to assist participants in getting their products to themarket. For example, these partners trained participants in design thinking, howto build a business plan, how to find investors, and most importantly, how toturn their ideas into real-life products by building a route to market throughestablished channels. Likewise, it has collaborated with several incubatorprograms (e.g., Artilab and Fablabs) to help scale solutions and addressunforeseen challenges in the market.The directors of the Enable Makeathon learned some other important lessons intheir first two contests as well:Start with a team. In the first year of the contest, the organizers spent a lot oftime helping the individual inventors form development teams. Beginning withthe second year, the directors decided to eliminate this step and only allowedinventors with development teams to apply.Plan the business. An innovation has a much greater chance of adoption if ithas a solid economic case behind it. Beginning with the second edition,Makeathon organizers encouraged applicants to submit their idea with abusiness plan that used the Business Model Canvas methodology. The Red Crossalso assigned each team an experienced entrepreneur as a business mentor. Thementors helped the teams refine the business models, marketing plans, and costand revenue projections that had been included in their first-round pitches.31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 5 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationMeet in person. Contest winners were brought to a 10-day co-creation andtesting camp, where they had a chance to work together on their idea and tomeet a group of people who had the disability the team hoped to address. Theteam would get prospective customers’ feedback on the product. Disabledpeople would also take the teams on field trips to show them what it’s like to livewith a particular kind of disability. Each team met with other stakeholders whohad some contact with their chosen community of disabled people, includingNGOs, humanitarian workers, and investors. This step helped the teams furtherstrengthen their innovation idea and reduced the likelihood that thesestakeholders would feel threatened by the external innovators later on.Lower your risks when you can. To help the winners think in practical termsabout the rollout of their solutions, the Red Cross enrolled them in severalestablished incubator programs that help startups scale their solutions. At thesecamps, teams also received training in special skills such as design thinking thatwould help them become successful entrepreneurs.Pave the route to market. Red Cross proactively introduced contest winners tokey players in their particular industry who could help them go to market. Thisincluded potential distributors, industry associations, and local Red Crosssubsidiaries that could be interested in stocking the winners’ products.The numbers suggest that supporting the development of a group of ideawinners is a better approach to crowdsourcing innovation than simplywinnowing ideas: In the latest session of the Enable Makeathon, the organizersdidn’t wade through thousands of entries; Instead, they selected the 16 mostpromising teams out of 116 applications (11 in Bangalore and five in London). Of31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 6 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovationthose 16 teams, 15 were able to develop a practical prototype — anextraordinarily high yield when you consider that venture capitalists see viabilityin less than one percent (0.7%) of the proposals they review.Johanna Brunneder is a product manager at TCS. Previously, she was anassistant professor at EDHEC Business School and an academic adviser at theInternational Committee of the Red Cross. Follow her on Twitter at@JohaBrunneder.Oguz A. Acar is an associate professor (senior lecturer) at City, University ofLondon’s Cass Business School and a fellow of the Royal Society of Arts. Followhim on Twitter at @oguzaliacar.Dirk Deichmann is an associate professor at Erasmus University’sRotterdam School of Management.Tarun Sarwal is founder and managing partner of Inkludo, a consulting firmthat works with startups focused on social impact. He previously worked as aninnovation advisor at the International Committee of the Red Cross.This article is about INNOVATION31/01/2020, 17:45A New Model for Crowdsourcing InnovationPage 7 of 7https://hbr.org/2020/01/a-new-model-for-crowdsourcing-innovation Follow This Topic

A New Model for Crowdsourcing Innovation

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A New Model for Crowdsourcing Innovation

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