While there is a lot of buzz about crowdsourcing, there is mainly a great lack of insightful tools to give the concept a meaning and place within existing organizations. As a result, not many companies know what crowdsourcing actually is, let alone they are able to integrate it in their businesses. The IOC-model^TM is a very simple tool that shows how and when crowdsourcing can be relevant by integrating it in your decision-making processes.

In traditional business thinking, there are two viable generic options for performing a certain activity: either you do it In-house, either you Outsource it to a specific party (with levels of collaboration in between). Coase’s theorem provides basic insights in this choice on the level of transaction costs. With the rise of the internet however, transaction costs are lowered furthermore, resulting in a new, third option: Crowdsourcing. In this third option, the task is formulated as an open call towards an undefined, generally large group of people. As such, the IOC-model^TM looks at leveraging the wisdom and skills of the crowd, not necessarily only your customers. Crowdsourcing is bottom-line a new generic option to perform activities/tasks/functions, and should be integrated that way in business decision-making.

How to use this tool? Print-out the figure above, and try to apply it systematically when thinking about activities. For example the design of a new logo: should we do it in-house, outsource it to a specific design agency, or crowdsource it in the form of a challenge like spreadshirt? The content on a new website: are we going to do it in-house, outsource it to freelancers, or crowdsource it like YouTube does for video content? Below, the model is applied to the case of corporate R&D.

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As companies increasingly recognize the importance of reaching beyond their four walls, there’s an urgent need for implementation roadmaps in this area. Two world-renowned business innovation experts address this “execution gap” in their new book The Global Brain, and help you identify and implement the best network-centric innovation strategy for your company. An inspiring interview with Satish Nambisan, one of the book’s authors and a global thought leader in the field of innovation:

1) What’s the key message or take-away for practitioners?

The key message is that a “one-size-fits-all” approach to network-centric innovation is a sure prescription to failure (in other words, copying what a P&G or an IBM does in open innovation is not necessarily going to be a successful strategy for your company). There are different forms or models of network-centric innovation. Each company has to identify the approach or model that best fits their particular industry/market context. In this book, we structure the landscape of network-centric innovation (i.e. define the different models of network-centric innovation) and explain how companies can identify the model or approach that is most suitable for them and then prepare for those collaboration opportunities by developing the appropriate portfolio of organizational competencies and capabilities. In sum, companies that invest in processes to systematically identify the right network-centric innovation approach and the requisite organizational capabilities are more likely to benefit from such initiatives than those who blindly follow the latest high-visibility example of network-centric innovation.

2) What are the new, important jobs that will arise from this shift taking place?

Several new entities or roles have emerged in this space – each of which implies a new job or a new type of firm.

For example, my book describes a new type of innovation intermediary called ‘Innovation Capitalist’ – a firm that seeks out innovative ideas from independent inventors, invests in those ideas and transforms them to a stage where their market and technical feasibility are clear, and then sells the related licenses and/or patents to large client firms who can take those ideas to market. We are already seeing several such firms all over the world – in US, in Europe, and in Asian countries such as India and Singapore.

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