CHAPTER 2 :

Crowdsourcing Fundamentals

According to Howe (2006), the act of a company or

institution taking a function once performed by employees
and outsourcing it to an undefined (and generally large)
network of people in a form of an open call. This can take
the form of peer- production (when the job is performed
collaboratively), but is also often undertaken

by sole individuals. The crucial prerequisite is the use of

the open call format and the wide network of potential
labourers.

1 st wave: Outsourcing
Outsourcing was not formally identified as a business strategy until 1989. At that time, most organizations were not totally
self-sufficient; they outsourced those functions for which they had no competency internally. Publishers, for example, have
often purchased composition, printing, and fulfilment services. The use of external suppliers for these were essential but
ancillary services might be termed the baseline stage in the evolution of outsourcing. Outsourcing support services is the
next focus. In the 1990s, as organizations began to focus more on cost saving measures, they started to outsource those
functions necessary to run a company but not related specifically to the core business. Since then, outsourcing has
experienced tremendous growth and as acceptable way to meet a company’s needs by both large and small companies.
 2nd wave: Offshoring
From outsourcing it evolved to offshoring which
involves the relocation of a business process from one
country to another country typically an operational
process, such as manufacturing, or supporting
processes, such as accounting. Many business
organization and governments employ offshoring to
generally low-cost labour country for economic
efficiency and improve corporate profitability. China
has emerged as a prominent destination for production
offshoring, while India has been the leading country in
software and information system industry.

3rd wave: Open Sourcing

The latest trend of outsourcing recently is to use
Internet as the main sourcing platform. Examples of
these online sourcing platforms (OSPs) include Worker
(Former RentACoder), E-lance, Guru.com, TopCoder,
Amazon’s Mechanical Turk platform (AMT), and
InnoCentive. Previous trends of outsourcing, are often
regarded as very expensive and involve long-term
contract commitment between organizations.
However, this new trend of outsourcing is haracterized
by relatively small and more manageable contracts.
There are researchers who name the method as
microsourcing while others name it as crowdsourcing.
Indeed, crowdsourcing has become a new society
paradigm that might change the outsourcing landscape
in the future

Crowdsourcing is the act of taking a job

traditionally performed by designated agents
(Usually an employee) and outsourcing it to an
undefined, generally the wide network of potential
labourers in the form of an open call. This can be
in the form of peer production (when the job is
performed collaboratively), or by sole individuals.
Suggested Answers:

1. Crowdsourcing is the distribution of well-defined tasks to an anonymous large group of external networked users
(digital workers) in the form of an open call through the internet specific application (platform).
Crowdsourcing ialah pengagihan tugas yang jelas kepada sekumpulan besar pengguna rangkaian luaran (pekerja digital)
tanpa nama dalam bentuk panggilan terbuka melalui aplikasi khusus internet (platform

2. The terms open innovation and crowdsourcing are related as both of these concepts are based on an “open”
approach which leverages internal and external source of labour for ideas and input.
Istilah inovasi terbuka dan penyumberan ramai adalah berkaitan kerana kedua-dua konsep ini adalah berdasarkan pendekatan "terbuka"
yang memanfaatkan sumber tenaga kerja dalaman dan luaran untuk idea dan input.

3. For job provider

• Cost Effective - allows companies to employ a large group of skilled people
to handle projects within a specific time frame for a fixed price.
• Faster execution of tasks especially for tedious and micro tasks for example data validation.
• Match the needs and solutions

For digital workforce

• Flexible circumstances of working hours, locations and duration of their own choices.
• Earn additional income especially those from low-income community who can increase their income, savings,
skills and knowledge in computer, typing, technical and others.
• Recognition – sense of accomplishment among peers
• Increase self-esteem, goals and experiences among digital worker
With today’s advanced technology, workers will not be bound by the
timetable of a particular work. Yet, they are also not necessarily a permanent
worker in an organization. They are free to become permanent or part-time
worker. Based on this concept, crowdsourcing is seen as a method to
complete work even if an organization does not have permanent worker.

This is done by sending work to the platform and then the platform will divide
the work to smaller parts and subsequently distribute the work to be
executed by digital workers registered with crowdsourcing.
 The task delegation process on the crowdsourcing platform is described:
The cycle starts when the job provider sends a job. For example translation to the
crowdsourcing platform to be completed. These tasks are given to crowdsourcing
platforms to be advertised to digital workers.

The platform will divide the work into smaller tasks in advance. Then the platform will
advertise the tasks to digital workers who have registered with them. Once a task is
advertised on a platform, digital workers will pull the tasks based on their interests
and ready to accept and complete it in a specified period given.

Tasks that have been completed will be sent back to the platform together with proof
of the completed tasks to the platform. The tasks are then verified as completed by
the platform.

Then the platform will integrate these tasks into a single perfect work before being
brought forward to the job provider.

Once the job provider is satisfied with the work, the job provider will pay the
platform. Then, the platform will pay to digital workers through various payment
mechanisms available.

Suggested Answers:
1. Basically the ecosystem comprises of four components of role players which are:
• Platform - Platform is a system that becomes mediator and will divide work to digital workers
• Digital Workers - Digital Worker is a group of workers who has registered with the crowdsourcing platform to
carry out the tasks given by the platform
• Job Providers - Job provider is business organization, individual or government who have certain works or tasks
to offer to digital workers
• Enablers - Enablers are body or government that can help to enhance the capability and capacity of job provider,
platform and digital worker

2. The cycle:
1) Job provider submit task to the platform
2) Digital worker will select task according to their skills and pull the task form the platform
3) After the task has been completed, digital worker will upload the completed task into the platform
4) Job provider will check and approve the task completed
5) If the job provider is satisfied with the task completes, they will pay the digital worker through the platform
A popular Reality TV show "American Idol” is an example of Crowd Voting.
Another example of crowd voting is Threadless.com who uses crowd
voting to decide which T-shirts to manufacture and sell on its web site; it
 Open innovation is “the use of purposive inflows and outflows of knowledge to
accelerate internal innovation, and expand the markets for external use of innovation,
respectively.” Open innovation can be understood as the antithesis of the traditional
vertical integration approach where internal R&D activities lead to internally
developed products that are then distributed by the firm. There are two facets to open
innovation. One is the “outside in” aspect, where external ideas and technologies are
brought into the firm’s own innovation process.
This is the most commonly recognized feature of open innovation. The other, less
commonly recognized aspect is the “inside out” part, where un- and under-utilized
ideas and technologies in the firm are allowed to go outside to be incorporated into
others’ innovation processes.
Henry Chesbrough, Open Innovation: The New Imperative (2003)
Example is https://ideas.lego.com/ is an initiative based on a co-create open
] innovation model. In this online website, LEGO consumers can design their own LEGO
sets either using LEGO bricks or computer 3D applications. Other users start to discuss
the idea and vote for it, once the idea reaches a targeted vote, LEGO can consider it as
a new product with giving a small part of the revenues to the creator of the set.

In 2012, the Rijksmuseum launched its new website, Rijksstudio, presenting 220,000
works of art in high resolution. However, each art work needs detailed descriptions
to describe iconographic elements depicted on works of art. But the museum lacks
manpower and knowledge to describe all details on each object in the collection.
Crowdsourcing iconographic aspects of the collections is the only way to get this job
done. Thus, the museum introduced a new platform called “accurator”.
http://www.accurator.nl/#Intro the goal of the system is to develop new tools for
crowdsourcing in the cultural heritage domain and to get people involved in
annotating and enriching museums’ data with expertise that is not available
internally. For example, academic researcher in the field of informatics and experts
from non-profit organisations..
Suggested Answers:

1. Any six:
•crowd service processing
•crowd funding
•crowd creation
•crowd voting
•Crowd content
• Open innovation
• Crowd reviews
• Collection knowledge

2. Crowd service processing is also known as the crowd service-based model which aims to incorporate the information,
knowledge, and skills of the crowd to fulfil a range of tasks from simple to complex while crowd creation is category
involves the use of sources outside the entity or group to generate, develop and implement ideas, suggestion or inputs.

3. Crowd funding is to raise funding (involves approaches to raise capital for new projects and businesses for the success of
a project or businesses by soliciting contributions from a large number of stakeholders or crowd) Crowd voting is to
raise vote (voting rely on large quantities of participant and being evaluated in a collective way)
Suggested Answers:

1. This is based on availability of organization to fulfil the requirements of crowdsourcing in terms of technology
affordability, policies and procedures, innovation culture, strategies and visions, governance, as well as top
management commitment.

2. Digital workers are required to have the appropriate skills, competency, functional expertise, positive attitudes and
mindset, and the culture to adapt and adopt. Skills required includes computer skills, problem solving skills, time
management skills, and others.

3. By having good linkage and trust towards crowdsourcing, digital workers will be motivated to involve and participate.
This is because Trust has also been proposed in outsourcing literature as a key factor that influences the relationship
between digital worker and platform.
 This model is based on two assumptions from the job demands-resources (JD-R) model (Bakker and
Demerouti, 2007; Demerouti et al., 2001).: • first assumption is that job resources such as social support,
performance feedback, skill variety, and autonomy, start a motivational process that leads to work
engagement, and consequently to higher performance. • second assumption is that job resources become
more salient and gain their motivational potential when crowdworkers are confronted with high job
demands (e.g. workload, emotional demands, and mental demands).
JD-R model showed that job and personal resources are mutually related, and that personal resources can
be independent predictors of work engagement. Thus, crowdworkers who score high on optimism, self-
efficacy, resilience and self-esteem are well able to mobilize their job resources, and generally are more
engaged in their work. It is assumed that job resources and personal resources independently or
combined predict work engagement. Furthermore, job and personal resources particularly have a positive
impact on engagement when job demands are high. Work engagement, in turn, has a positive impact on
job performance. Finally, crowdworkers who are engaged and perform well are able to create their own
resources, which then foster engagement again over time and create a positive gain spiral.

Suggested Answers:

1. Cognitive engagement is a form of instruction that challenges digital workers to draw upon basic skills to engage in
higher level thinking. Crowds that have high cognitive engagement ensure high participation among crowds in
crowdsourcing. Crowds with high cognitive engagement are able to analyze, synthesize and evaluate using what
they know thus deliver high quality completed task

2. Emotional engagement involves interest, boredom, happiness, anxiety, and other affective states, any of which
factors could affect learners’ involvement with learning or their sustained effort in playing games, such as in the
context of playing a game.
Example: Any example that will show the situation of satisfied crowd workers and result in high
quality task completed.

2. Job Resources- Job resources refer to those physical, social, or organizational aspects of the job
Personal Resources – referring to crowd workers personality