Actually both brands and companies increasingly use crowdsourcing in their strategies: brands do it often for marketing and communication, companies do in for innovation. The latter has been described in a recently published article: Test-Driving the Future: How Design Competitions Are Changing Innovation, written by three London researchers, and published in Academy of Management Perspectives. It focuses on innovation-related crowdsourcing, like Cisco’s and GE’s challenges. Let me give some information about the former in this post.
Lampel & al.’s article uses the term “design competitions” to describe various forms of crowdsourcing used by companies. The term is misleading because it sound like the creative forms of crowdsourcing, but in fact it is really about innovation and technical problem-solving. Probably they use this term because other, more descriptive terms, seemed to be “taken” in academic literature. At the beginning of the article, the authors indeed say “what we call here “design competitions” have been defined elsewhere as innovation contests (Boudreau, Lacetera, & Lakhani, 2011), technology contests (Cohen, Kaplan & Sela, 2008), innovation tourna- ments (Terweisch & Xu, 2008), and tournaments for ideas (Morgan & Wang, 2010).” Anyway.
We are seeing a tendency for them to evolve beyond one-time challenges into multiyear events — and then into portfolio programs that encompass multiple design competitions (Lampel, Jha & Bhalla, 2012)
The interesting part of this article is the second part, where the authors claim that “design competitions” are increasingly used in strategic ways. Examples of the article include DARPA challenges, the X Prizes (including the Google Lunar X Prize) and Cisco’s I-Prizes. We have seen permanent crowdsourcing platforms emerge (Dell’s Ideastorm, Starbucks’ myStarbucksIdea or Nokia’s IdeasProject), but we also see that individual contests are used as part of companies’ strategic innovation roadmap. Let’s look at one example, Cisco’s I-Prize:
Cisco Systems is a global corporation that designs, manufactures, and sells networking equipment across the globe. It is also one of the most valuable brands in the world as it has been ranked #14 in the last Interbrand’s Best Global Brands ranking, which is why it appears on the crowdsourcing timeline illustrated above. The company’s crowdsourcing program is called I-Prize, and is a global competition that asks entrepreneurs to submit innovative business ideas that Cisco could fund and help develop.
“This design competition had only two iterations, Lampel et al. say in their paper, but organizers used the experience of the first competition to revamp the second I-Prize in 2010, putting more emphasis on collaboration.” Actually there were more iterations, four by this time, but the two last ones were just announced by the time the paper has been written. They were highly strategic as they were used as part of Cisco’s massive investment plan in Russia. Here is a little more about the four I-Prize competitions:
- Cisco’s first I-Prize challenge was launched during the opening of Cisco’s Globalization Center in Bangalore, India, in October 2007. As Venture Beat notes, this first edition “relied almost entirely on word of mouth“. Nevertheless, over two months, some 1,200 ideas for “billion dollar” businesses were submitted, in hopes of winning the $250,000 prize. The winning team was based in Germany and Russia, and presented Cisco with an idea to improve energy efficiency by taking advantage of Cisco’s leadership in Internet Protocol (IP) technology.
- Cisco’s second I-Prize challenge was launched in early 2010, and focused on four themes: the future of work, the connected lifestyle, new learning styles and the future of entertainment. A total of 2900 participants representing more than 156 countries submitted 824 ideas to the competition. During the CiscoLive! event in Las Vegas, team Rhinnovation! from Mexico was announced as a winner, their idea proposed creating a physical and virtual platform that facilitates connectivity along with smart objects, people, and information.
- Cisco’s third I-Prize challenge was targetted towards Russia: The “Skolkovo Innovation Award: Powered by Cisco I-Prize,” launched with the Skolkovo Foundation, was a competition for Russian entrepreneurs, innovators, students and technologists to submit new business ideas. “We are intending to establish new start-up ventures that could be basec in the pending Technopolis Skolkovo, that is this innovative community being formed in Russia,” explained Marthin De Beer, SVP Emerging Technologies Group for Cisco. After a three-months submission period, 2,318 ideas were submitted from more than 10,000 people from hundreds of locations across Russia, check out the winners here.
- The fourth Cisco I-Prize challenge is still underway. Cisco initiated another challenge targetting Russia, this time for technological projects based on the development and use of grid and cloud technologies.The company called Russian entrepreneurs to submit ideas of technological projects based on the development and use of grid and cloud technologies related to one of the following three categories: the use of technology in energy saving, the use of technology in healthcare, and the use of technology in education. Submission ends in December 31st 2012.