The solver’s proposed solutions are posted and then reviewed by InnoCentive who workwith the solver to refine as needed. Innocentive selects the best submission and awards are paid to the solver. Identities of both parties are kept confidential until a verified submissionhas been accepted and award paid; InnoCentive bills the seeker for that amount plus its fee. An indemnity agreement is obtained from the solver to protect both the seeker andInnoCentive.”
Example of a project:
“Take Colgate-Palmolive (CL). The company needed a more efficient method for getting itstoothpaste into the tube — a seemingly straightforward problem. When its internal R&Dteam came up empty-handed, the company posted the specs on InnoCentive, one of manynew marketplaces that link problems with problem-solvers. A Canadian engineer named Ed Melcarek proposed putting a positive charge on fluoride powder, then grounding the tube. Itwas an effective application of elementary physics, but not one that Colgate-Palmolive'steam of chemists had ever contemplated. Melcarek was duly rewarded with $25,000 for a few hours work.”
Discussion and Debates
1. Innocentive isolates the problem solvers from each other
Commentary by Sami Viitamaki:
“Innocentive fits the category of crowdsourcing that does not fully utilize the community’s‘wisdom of crowds’. The solvers pursue the solution in isolation from each other, and the possibility of using the community to gather comments on the alternatives, build on others’ideas, find a winning solution by community rating, etc. is absent.In my thesis I call these kind of companies ‘Crowdsourcing Brokers’, for they really simply gather up alternative solutions from a large member base for their own clients’ needs andleave deciding on the winning solution to the clients. Given the nature of the competition inthese kind of efforts and the considerable monetary rewards involved, the approach isnaturally understandable. Other ‘broker’ approach companies are e.g. iStockphoto andHolotof advertising.”
2. Summary of a study by Karim Lakhani:
“Karim Lakhani and his team at Harvard Business School have been studying this phenomenon in the context of scientific problem solving (working paper here) based on data from Innocentive’s winning entries (30% of all problems on Innocentive have been solved).Below are some of their findings of the study followed by my commentary on itsapplicability to analytics:In short, diversity of problem solvers area of expertise was key. Analytics lends well todiversity as it is a very multi-disciplinary field with potential applications from a variousbranches of science i.e. economics, mathematics, engineering, psychology, operationsresearch etc.