Wisdom of the crowd and capabilities of a few: internal success factors of crowdsourcing for innovation

Crowdsourcing has been demonstrated to be an effective strategy to enhance the efficiency of a firm’s innovation process. In this paper, we focus on tournament-based crowdsourcing (also referred to as “broadcast search”), a method to solve technical problems in form of an open call for solutions to a large network of experts. Based on a longitudinal study of six companies piloting this application of crowdsourcing, we identify barriers and sources of resistance that hinder its implementation in firms. Our paper contributes to the state of research by analyzing crowdsourcing on the level of pilot projects, hence providing a workflow perspective that considers the creation of dedicated processes and operations of crowdsourcing. This project level analysis enables the identification of specific challenges managers face when implementing crowdsourcing within an established R&D organization. Following a design science approach, we derive suggestions for organizational interventions to overcome these barriers. We find that dedicated promoter roles strongly contribute to a successful implementation of crowdsourcing, turning pilot projects into an organizational routine.     

Using tri-reference point theory to evaluate risk attitude and the effects of financial incentives in a gamified crowdsourcing task

Crowdsourcing has rapidly developed as a mechanism to accomplish tasks that are easy for humans to accomplish but are challenging for machines. However, unlike machines, humans need to be cajoled to perform tasks, usually through some type of incentive. Since participants from the crowd are typically anonymous and have no expectation of an ongoing work relationship with a task requester, the types of incentives offered to workers are usually short-term monetary bonuses, which have had an inconclusive impact on crowdsourcing worker quality. In this paper, we explore the notion that the risk attitude of crowdsourcing workers may play an important role in the effectiveness of incentives on task accuracy. Traditional utility theories, such as prospect theory, depend on decisions made relative to a singular reference point, whereas the tri-reference point (TRP) theory (Wang and Johnson, J Exp Psychol Gen 141:743–756, 2012) holds that three reference points impact decision making. Using the TRP theory as a guide, we develop a game that provides workers with three reference points and subsequently explores the role of multiple reference points on worker risk aversion and task accuracy.     

Environmental improvement initiatives in the coal mining industry: maximisation of the triple bottom line

Abstract

Mining is an economically important industry, which faces several environmental and social challenges. Other than operational improvement activities, mining companies are increasingly paying attention to reduce greenhouse gas emissions (GHGs) and maximise social welfare to satisfy multiple stakeholders and the rise of corporate social responsible initiatives. Based on a case study analysis of coal mining companies we develop a triple bottom line (TBL) initiatives framework that provides a starting point for mining companies to develop a strategic approach to environmental improvement initiatives that can positively impact all elements of the TBL. We highlight four types of process and offset-based initiatives that are available to mining companies to reduce their GHGs, each having differential effects on elements of the TBL. Our findings suggest the importance of company-wide strategies of looking at initiatives through all rather than individual elements of the TBL. Such a strategy would provide an appropriate estimate of the costs and benefits of the initiatives and results in a balanced approach that takes care of operational improvement, reduces GHGs and improves the social welfare of people engaged in mining operations and wider society.     

Optimal Fee Structures of Crowdsourcing Platforms

Crowdsourcing platforms specialize in hosting open contests and usually charge a percentage of the prizes as service fees. While prior research has studied the design of contests and the behavior of contestants, the strategy of a crowdsourcing platform has remained largely unexplored. We develop a game‐theoretic model of crowdsourcing services and find the optimal fee structure of a platform. We prove for the case of a single contest that the service fees should be an increasing concave function of task prizes and show that this also holds true for the case of multiple contests. We further find that for a platform with many users and tasks, there is an optimal ratio of the number of contestants and contests. Our research is one of the first to focus on the strategies of crowdsourcing platforms and our results have interesting managerial implications. We show that the linear fee schedule widely used in practice is not optimal and that a platform is better off lowering the fee rate for contests with high prizes. It is also in the best interests of a platform to develop both sides of the crowdsourcing market proportionally and keep the ratio of contestants and contests at the optimal level.      

Governance Considerations for Seeker–Solver Relationships: A Knowledge‐Based Perspective in Crowdsourcing for Innovation Contests

The need to solve innovation problems and insource knowledge has led to an increasing number of organizations engaging in crowdsourcing activities and subsequently establishing working relationships with winning solution providers. Using a knowledge‐based view and the problem‐solving perspective, we develop a theoretical framework suggesting how specific innovation problem attributes (i.e. the decomposability, formulation and search space of the problem) influence the governance decision (unilateral vs. bilateral) of seekers to manage the relationship with winning solvers. We empirically analyse the framework using 582 challenges broadcast on the NineSigma crowdsourcing platform. Our results indicate that problem attributes – the formulation and search space of the problem – have a positive effect on seekers’ preference towards unilateral governance structures. However, we did not find any empirical confirmation of the effect that the decomposability of the innovation problem has on seekers’ preference towards unilateral governance structures. This study offers several contributions to the crowdsourcing literature, and also has important implications for managers of organizations aiming to insource knowledge through crowdsourcing for innovation contests.     

Managing testing activities in telecommunications: A case study

This paper examines ways of managing testing more efficiently and effectively. The importance and the workload of testing have been growing constantly in the telecommunication industry, as a result of shorter product lifecycles and decreased time-to-market. At the same time, the complexity of products has increased with a decrease in physical dimensions. Managers face enormous challenges in developing knowledge and effective testing processes. This case study proposes the application of two models, a testing optimization model and an extended V2M2 (Verification Validation Maturity Model) model, for managing the value of testing. In the empirical part of the study, the present state of testing management is examined.     

Production planning and control as a tool for eco-efficency improvement and environmental impact reduction

The environmental impacts of industrial activity are an increasing concern amongst firms and their stakeholders. As a result, companies around the world have been exploring new tools to diminish the adverse impact of their activities on the environment. Eco-efficiency has played an essential role in this scenario, as companies are continuously seeking to produce more while utilizsing fewer resources and minimising adverse effects on the environment. The literature includes several initiatives to improve eco-efficiency and to reduce the environmental impact of manufacturing operations, but the use of production planning and control (PPC) activities to accomplish these goals has rarely been considered. Therefore, to contribute to the assessment of this issue, this paper proposes to integrate environmental concepts and actions as part of the PPC execution; therefore, they could also be applied to minimise environmental impacts, resulting in an increase in the eco-efficiency level of a company. The practical utilisation of the suggested procedure was confirmed using a case study where the procedure was successfully applied to a make-to-order firm, where a simplified version of a workload control (WLC) form of PPC was in use. As a result, incorporating environmental considerations into the WLC practices enabled the eco-efficiency level of the designated production area to increase by 42%, while the environmental impact of production was reduced by 13%.     

行为控制对威客持续参与意愿的影响:被调节的中介模型

威客的持续参与意愿是维持众包平台可持续性发展的关键因素。在众包参与过程中,平台实施的控制机制是否会影响持续参与意愿还缺乏系统的理论分析和实证研究。基于感知组织支持理论,本文构建了被调节的中介模型和相关假设,探讨行为控制如何通过归属感的中介作用影响持续参与意愿,以及在不同的程序公平水平下,行为控制通过归属感提升持续参与意愿的机制会有怎样的变化。基于“猪八戒网”搜集的290份样本数据,对模型进行实证检验。结果表明,归属感在行为控制影响持续参与意愿的关系中起部分中介作用;同时,程序公平正向调节上述中介作用,即程序公平越高,归属感在行为控制与持续参与意愿关系间的中介作用越容易实现。研究结果丰富、扩展了已有的众包理论研究,并为众包实践提供了管理启示与指导。     

Stakeholder Reporting: The Role of Intermediaries

Corporate social responsibility encompasses a multiplicity of different concepts, such that its nature is confused, and it remains difficult to operationalize because opening dialogue with and responding to the various expectations of diverse stakeholders is beyond the capacity of many companies. This paper adapts Mayston's normative “information beneficiaries” framework and focuses on intermediaries who might potentially use published financial information to open a restricted form of dialogue with companies, which might benefit unsophisticated stakeholders. The paper examines the Mayston framework using interviews conducted in organizations that might act on behalf of three stakeholder groups associated with gas and electricity suppliers in the United Kingdom, these being: consumers, employees, and the environment. While a long chain of communication exists between utility company and stakeholder, and many organizations do not fulfill their full potential as information intermediaries, there is some evidence that Mayston's framework might well operate in practice.     

Integration of project management,human resource development,and business teams: a partnership,planning model for organizational training and development initiatives

The changing business environment has challenged organizations to explore unique ways to ensure the success of online training initiatives. Thus, project teams, including training managers, should not only support organizational training and development initiatives; but, they also need to use project-focused, planning models for implementation. This paper proposes a model that is an extension of the model for business and training partnership developed by Price. The proposed model includes the integration of project management, human resource development (HRD), and business teams in order to enhance the success of training implementations through a sequential, planned framework. The model includes phases, best practices, and supporting tools to assist in managing and administering training and development projects. The approach developed in this research includes an account of the activities associated with initiating, planning, executing, monitoring and controlling, and closing processes for an online training initiative conducted in an oil and gas organization. This research also discusses implications of the proposed model for HRD professionals, because they are typically the champion of training and development initiatives within organizations today.     

Trends and challenges of developing human capital in Singapore: an analysis of current practices and future potentials

As one of the most vibrant nations of Asia, Singapore is well known for its dynamic and innovative human capital development initiatives. These are driven mainly by the government policies, with inputs from public sector organizations and large local companies. Human resource development (HRD) related legislations, financial incentives, infra-structural support and deployment of management and info-communication technologies (ICT) help to sustain the national HRD initiatives. This paper presents an analysis of the current practices and future trends and challenges faced by organizations in Singapore. Some of these challenges are: ageing workforce, talent retention and development, rapid technological changes and cross-cultural skills development for working in the emerging markets. Eight trends and challenges identified here are expected to significantly impact the HRD profession in future. Implications of the trends and challenges are also discussed for future research and professional practice.     

Challenges and solutions for marketing in a digital era

Internet usage continues to explode across the world with digital becoming an increasingly important source of competitive advantage in both B2C and B2B marketing. A great deal of attention has been focused on the tremendous opportunities digital marketing presents, with little attention on the real challenges companies are facing going digital. In this study, we present these challenges based on results of a survey among a convenience sample of 777 marketing executives around the globe. The results reveal that filling “talent gaps”, adjusting the “organizational design”, and implementing “actionable metrics” are the biggest improvement opportunities for companies across sectors.     

Offshoring practices of Danish and Swedish SMEs: effects on operations configuration

This paper examines how small and medium enterprises (SMEs) configure their operations on the global scale and how this affects their home bases in terms of operations requirements and priorities. In order to relate SMEs’ offshoring initiatives with their operations configuration attributes, we draw on the operations networks literature and survey responses from 675 Danish and 410 Swedish companies. On the basis of the survey results, we find that although the SMEs are less experienced and less advanced in their offshoring ventures than large companies, they are building dispersed operations networks. Although still in their infancy, these networks are, as expected, creating new demands for their home bases in terms of demands for formalisation of work processes, systems development and managerial capability related to orchestrating operations across national borders, but more fundamentally, it also challenges the strategic foundations of the home base. Based on these observations, we discuss future global operations management challenges, practices and priorities of SMEs.     

Dow Jones Sustainability Group Index: A Global Benchmark for Corporate Sustainability

Increasingly investors are diversifying their portfolios by investing in companies committed to the concept of corporate sustainability. Investors are attracted to this new investment style because it promises to create long-term shareholder value by embracing opportunities and managing risks deriving from ongoing economic, environmental and social developments. It focuses on future challenges and is capable of capturing qualitative non-financial information for criteria such as quality of management, corporate governance structures, reputational risks, human capital management, stakeholder relations, corporate social responsibility.Here we present the framework used by the Dow Jones Sustainability Group Index (DJSGI) for identifying and ranking companies according to their corporate sustainability performance. In a yearly review the 10% leading sustainability companies in each of the 64 industry groups are selected for inclusion in the DJSGI. Throughout the year the companies are continuously monitored and, if necessary, downrated or excluded from the Index. A variety of sources is used for the assessment and for cross-checking of information, including company questionnaires, company documents, publicly available information, stakeholder relations, media screening and company interviews. The selection process is externally verified and the methodology is reviewed yearly to capture the increasing knowledge and standardisation of sustainability issues and to align it with ongoing initiatives such as the Global Reporting Initiative.     

Limiting Exposure to Collateral Liability Associated With ISO 14001 EMS Audits

The purpose of this article is to provide suggestions on how to limit the collateral liability associated with ISO 14001 environmental management system (EMS) auditing activities. Due to the detailed, invasive nature of EMS audits, companies performing such activities may expose themselves to collateral risks. Collateral risk is liability not directly associated with ISO 14001 activities, but borne through the unrelated process of EMS audit activities. Examples of collateral risks include issues of non-compliance, unintended discovery of evidence in civil tort claims and exposure to regulatory sanctions. Therefore, well-defined management of EMS audits represents an important aspect of limiting risk. This article identifies several strategies for managing and reducing these legal risks. These strategies include the rigorous management of compliance audits, concisely defining audit scopes, training auditors and auditees, understanding and using audit privileges as appropriate, exploring the use of self-declaration (for ISO 14001 conformance purposes), and using reliable document control methods. While completely eliminating liability represents a laudable but challenging goal, these methods should reduce collateral exposure to corporate and personal liability.     

Quality Risk Ratings in Global Supply Chains

Extended enterprises face many challenges in managing the product quality of their suppliers. Consequently characterizing the quality risk posed by value‐chain partners has become increasingly important. There have been several recent efforts to develop frameworks for rating the quality risk posed by suppliers. We develop an analytical model to examine the impact of such quality ratings on suppliers, manufacturers, and social welfare. While it might seem that quality ratings would benefit high‐quality suppliers and hurt low‐quality suppliers, we show that this is not always the case. We find that such quality ratings can hurt both types of suppliers or benefit both, depending on the market conditions. We also find that quality ratings do not always benefit the most demanding manufacturers who desire high‐quality suppliers. Finally, we find that social welfare is not always improved by risk ratings. These results suggest that public policy initiatives addressing risk ratings must be carefully considered.     

New business development in mature firms

New business development (NBD) is one of the main strategic options for the ‘mature’ company. The authors discuss the reasons why NBD should be considered and suggest a framework for developing new businesses. The results of a two year investigation of a sample of 14 UK companies' NBD initiatives are presented. Half of the sample have either abandoned or are reducing their new business activities. The reasons are manifold and relate to a failure to define specifically the role of the NBD initiatives; a lack of appreciation of the risks, long time spans for development and the high financial commitment associated with NBD; a weakening of the mainstream business (this in itself suggesting that companies often leave NBD ‘too late’); and a naive approach toward marketing. Some lessons for mature companies' future involvement in NBD are drawn.     

When and How to Pursue Corporate Social Responsibility with Core Competencies

We first establish that the pursuit of corporate social responsibility (CSR) can enhance the society's welfare when both market and government imperfections occur, and demonstrate this is likely in most locales across the world. Second, we show that CSR initiatives are most likely successful and sustainable when a firm accurately identifies the benefits and costs of potential CSR initiatives and implements them consistent with its core competencies. We provide three reasons for a firm to focus CSR initiatives on core competencies: to reap economies of scale and scope in building company‐wide knowledge and skills; to promote worker productivity that is integral to the firm; and to exploit the fixed costs associated with managing workers. Each reason provides a distinct way to minimize the costs and increase the gains from pursuing CSR initiatives and provides implications for implementing CSR initiatives.     

Electronic Intermediary Functional Roles and Profitability

Internet start‐ups and traditional firms expanding existing offerings and services through the Net have seen both success and failure. For such business model pursuits, electronic intermediation possesses the ability to cultivate new marketplaces and restructure supply chains. The economic literature identifies four distinct intermediary roles, specifically: (i) information and (ii) logistics management, (iii) transaction securitization, as well as (iv) insurance/market‐making and liquidity management. Research notes that electronic intermediaries, while possessing clear advantages in their ability to manage information, face greater challenges in allowing parties to benefit from the facilitation of more complex coordination activities, namely transaction securitization in addition to insurance/market‐making and liquidity management. In an effort to better understand pursuit of functional intermediary roles, our analysis of data collected on 182 electronic intermediaries explores relationships between intermediation roles and profitability. Business models relying solely upon the provision of information management are likely to realize lower levels of profitability. Alternately, the intermediary roles of logistics management as well as insurance/market‐making and liquidity management realize higher levels of profitability. Moreover, when comparing commodity‐ and service‐based intermediaries, the provision of logistics management on the part of commodity‐based firms sees higher levels of profitability, with insurance and liquidity provisions associated with greater profitability for both commodity‐ and service‐based firms. Finally, when contrasting traditional firms expanding operations in digital markets with Internet pure‐plays, we find transaction securitization functions increase the likelihood of realizing greater profitability for non‐Internet pure‐plays.     

Are crowds on the internet wiser than experts? The case of a stock prediction community

According to the “Wisdom of Crowds” phenomenon, a large crowd can perform better than smaller groups or few individuals. This article investigates the performance of share recommendations, which have been published by members of a stock prediction community on the Internet. Participants of these online communities publish buy and sell recommendations for shares and try to predict the stock market development. We collected unique field data on 10,146 recommendations that were made between May 2007 and August 2011 on one of the largest European stock prediction communities. Our results reveal that on an annual basis investments based on the recommendations of Internet, users achieve a return that is on average 0.59 % points higher than investments of professional analysts from banks, brokers and research companies. This means, that on average, investors are better off by trusting the crowd rather than analysts. We furthermore investigate how the postulated theoretical conditions of diversity and independence influence the performance of a large crowd on the Internet. While independent decisions can substantially improve the performance of the crowd, there is no evidence for the power of diversity in our data.