The immense power of online communities is virtually indisputable. Social media is disrupting traditional markets, and the Linux community transformed the world of enterprise computing software. That power in the form of crowdsourcing is now being harnessed as a resource to alleviate IT skills shortages and reshape the economics of IT development.
NASA Solve utilizes crowdsourcing challenges to help it problem solve and to stimulate innovation from non-traditional sources. It launched its first coding contest in 2009 to create algorithms aimed at optimizing medical kits for long space flights. In June 2015, the space agency announced 10 “Open Innovation Service” contract awards designed to utilize crowdsourcing for “outside-the-box thinking about human space exploration challenges…”
Glenn Weinstein is CIO of Appririo, one of the contractors working with the NASA Tournament Lab to manage its challenges. The 1200-employee IT services consultancy that utilizes cloud and crowdsourcing internally and for client engagements.
“Crowdsourcing is an opportunity to tap into the world’s best talent,” says Weinstein. “We think the future of work is changing. We are moving to a freelancer economy in this country and the world.”
Appirio launched its own crowdsourcing IT project management community, CloudSpokes, in 2011 and two years later acquired top cover, which had managed the original NASA challenge. At the time, the merger of the two communities represented 600,000 designers, developers, and data engineers, and has since grown to more than 800,000.
The topcoder model is built around competition and challenges. Registered freelance coders sign up for challenges, which are generally in short time frames. Community members, who are qualified reviewers, grade submitted challenges and the client gets ownership of the winning submission.
“We believe that at scale this is the most economic model of building and maintaining enterprise software,” says Weinstein. “You pay for the results, you don’t pay for the hours.” The successful fulfillment rate is 90-95 percent, compared to more typical IT projects that “have a much lower rate of success.”
The cost, Weinstein says, is typically $500-$1000 per challenge in exchange for work that would be significantly more costly through other sources. While that may sound cheap compared to U.S. skilled labor rates, overseas coders “can make more money through challenges than they could through direct employment,” he asserts. With a vast array of IT talent located outside the U.S., he adds, enterprises can use crowdsourcing challenges to attract talent regardless of location.
Managing IT crowdsourcing, he says, is analogous to how CIOs adopted offshoring 15-20 years ago. “It was a new way of doing business, and hard to wrap your head around it at first,” he says. “There is more of a premium on figuring out atomizing projects, publishing requirements and collecting results and integrating them back into your projects.”
If crowdsourcing sounds like managing a virtual Tower of Babel, Weinstein says it’s unlikely most enterprises would go it alone. “This is a build versus buy discussion for CIOs,” he says. “Its similar to offshoring -- you can go and hire offshore, but the more dominant model in enterprise IT is to go through a partner that does the training and has a specialty.”
With a reported 59 percent of IT execs saying they face a skills shortage, crowdsourcing may become a vital resource for enterprise IT. “There’s no doubt in my mind that Crowdsourcing [Application Development] is going to be huge for the enterprise – and those who figure out how to harness it early will enjoy a substantial advantage over their competitors,” Gartner analyst Eric Knipp blogged last year after publishing his Use Crowdsourcing as a Force Multiplier in Application Development" report.
