Business

Chapter 1

Research Question
In the world of business and technology, the practice of crowdsourcing has become an increasingly important tool in product development and trouble-shooting.  In the US, policy makers have taken steps to include crowdsourcing as part of the decision-making process (Hoover 2009).  A recent competition held by software testers was able to successfully identify and isolate 600 flaws in popular search engines, such as Google, Bing, and Yahoo, using crowdsourcing (Flinders 2009).  Exploration on Mars is also being facilitated by crowdsourcing.  NASA, along with the assistance of Microsoft, is using crowdsourcing to help it sort through some of the drudgework, by counting craters or matching high to low-res photos (Easton 2009).  Although crowdsourcing is a relatively new phenomena, organizations everywhere are recognizing the power of this tool to save both time and money, by tapping into a largely voluntarily workforce in order to solve problems andor expedite research.  

In this dissertation, innovations in crowdsourcing will be examined in order to determine their contribution to risk management in a business setting.  As Michael Nolan observes  Innovation is simply group intelligence having fun (quoted in Libert  Spector 2007, p. 20).  While a playful attitude towards crowdsourcing may be important, it is equally important to assess its use and any risks in the business context.

In order to facilitate this discussion, the research will begin by tracing the development and growth of crowdsourcing practices.  It will also provide a context for the use and application of risk management to the business context.  Finally, it will consider the intersection between the two.  This analysis will form the basis of the original research conducted for this project.  Although there is a growing awareness amongst practitioners and academics alike regarding the relationship between these two areas, existing research has not caught up with current practice.

Background
Crowdsourcing is a relatively new phenomenon.  It traces its roots in both technological developments, as well as the growth of the Internet.  The term was first coined by Jeff Howe, a writer for Wired magazine, in 2004.  He writes

Technological advances in everything from product design software to digital video cameras are breaking down the cost barriers that once separated amateurs from professionals.  Hobbyists, part-timers, and dabblers suddenly have a market for their efforts, as smart companies in industries as disparate as pharmaceuticals and television discover ways to tap the latent talent of the crowd.  The labor isnt always free, but it costs a lot less than paying traditional employees.  Its not outsourcing its crowdsourcing.

The difference is an important one.  While both outsourcing and crowdsourcing are products of our technological age, crowdsourcing, unlike outsourcing, has a much broader application.  Crowdsourcing would not be possible without the Internet.  The World Wide Web 2.0 plays a crucial role in supporting this function.  Cheap and easy access to the Internet and its attendant technology means that organizations can reach more people than ever before.  Just as one can market to millions with a click of a mouse, one can also potentially reach millions of experts, or at least knowledgeable enthusiasts, in precisely the same way.  As Howe points out, crowdsourcing enables businesses to collaborate with countless people in a relatively straightforward and cost-effective way.  For example, Oxford University adopted a crowdsourcing approach to its project Galaxy Zoo (Eaton 2006).  In this project, the public was able to provide input to a project to map the galaxy.  As a result, the University was able to complete the project in four months, rather than the two years it would have taken, depending on internal staffing and resources.

Crowdsourcing may be defined in a number of ways.  Wikipedia defines it thusly

Crowdsourcing is a  HYPERLINK httpen.wikipedia.orgwikiNeologism neologism for the act of taking tasks traditionally performed by an employee or  HYPERLINK httpen.wikipedia.orgwikiIndependent_contractor contractor, and  HYPERLINK httpen.wikipedia.orgwikiOutsourcing outsourcing them to a group ( HYPERLINK httpen.wikipedia.orgwikiCrowd crowd) of people or community in the form of an open call.  For example, the public may be invited to develop a new technology, carry out a design task (also known as community-based design and  HYPERLINK httpen.wikipedia.orgwikiDistributed_participatory_design distributed participatory design), refine or carry out the steps of an algorithm (see  HYPERLINK httpen.wikipedia.orgwikiHuman-based_computation Human-based computation), or help capture, systematize or analyze large amounts of data (see also  HYPERLINK httpen.wikipedia.orgwikiCitizen_science citizen science).

While Wiki is not generally considered to be a reputable academic reference, in this instance, it seems particularly appropriate to use it.  Wikipedia itself is a prime example of crowdsourcing and, as such, it illustrates both the strengths and weaknesses of the practice.  Wikipedias entries are crowdsourced.  The entries are written and edited by people from all over the world.  Some entries reflect original research and genuine insight, while others are blatantly plagiarized from other sources.  Many entries provide a good overview of a subject however, others reflect either ignorance or personal prejudice.  In spite of its many flaws, Wikipedia remains a first port of call for many people seeking to familiarize themselves with a subject.  While it is generally accepted that not everything found in there is necessarily accurate, most web users trust in the system of checks and balances to sort out the grosser inaccuracies.  The continued popularity of the website is a testament to the power of crowdsourcing in our contemporary culture.  Most importantly, it reflects an important shift in the culture.  People increasingly expect information to be a collaborative process.  Crowdsourcing has come to define our interaction with the world of knowledge.  We expect that businesses will give us a place to voice our comments and share our views, whether it is an entry in Wiki, a book review on Amazon or a reaction to a new product.  Crowdsourcing is the new reality of the twenty-first century.

Many trace the roots of crowdsourcing to open source movement in software (Howe 2009, p. 9 Bacon 2009, p. 246 Libert  Spector 2007, p. 3).  The open source movement, as it applies to software development, began in the latter part of the previous century.  It can be traced further back to the development of the Internet itself, when academics from various universities worked together to create the information highway.  In many ways, open source is likely best defined by its approach rather than its specific activities (Weber 2005).  While corporations such as Microsoft, IBM and Apple are all in the business of producing software, their approach to the process is a closed one.  Each corporation closely guards its developments and considers details about its applications to be trade secrets.  These corporations create software to be sold and marketed as a product.  In contrast, the open source movement recognizes that software is a product however, it does not seek to profit by its development.  Instead, it suggests that software is a common need and as such its development and uses should be available to all who need it (Weber 2005).  Linux is one of the best-known examples of free and open source software.  Over the years, Linux has been developed and refined by a collection of individuals, working from all over the world.  These individuals come from a wide range of occupations and backgrounds.  Some may be youthful enthusiasts working from their bedroom, while others may be tenured professors working in the lab.  The systems they have created are widely acknowledged as being highly effective and efficient (Weber 2005).  Judging by the number of PCs in both the home and office, it is clear that Microsoft has won the marketing war however, few people would argue that Microsoft created a superior product.  Windows and its many variants are notorious for a wide range of glitches and crashes.

The open source movement succeeded in achieving more than the creation of better operating systems.  According to Howe, this movement, revealed a fundamental truth about humans that had largely gone unnoticed until the connectivity of the Internet brought it into high relief  labor can often be organized more efficiently in the context of community than it can in the context of a corporation (p. 8).  Howes observation is an important one for a number of reasons.

Firstly, it challenges our preconceived notions about work.  Many political and social theories have been devoted to the study of work and motivation however, Howes observation challenges the basic assumptions many of these theories, as well as corporate employers make.  While many theorists would agree that motivation is not solely based on wages or compensation, few would predict the willingness of people to work for free in these on-line projects.  The nature of these projects, however, is important to consider.

Secondly, Howes assertion defines the important of community to this type of labor activity.  In the open source project, a group of specialist, albeit with differing levels of education, accomplishment, and experience, was united by a shared goal, namely the creation of the open source software.  These individuals shared a fascination with technical matters and were intrinsically motivated.  The challenges of creating software appealed to them on an intellectual as well as a practical level.  In addition, there was a sense of community that drove this project.  The individuals involved shared a genuine desire to create the best possible system, and they believed that this could best be achieved through the collaborative efforts of all involved.    

Thirdly, it underlines the importance of the Web to crowdsourcing.  The connectivity of the Internet plays a crucial role in the organization and motivation of the collaborative workforce.  It would be physically impossible to gather a workforce of this size and scope without the use of the Web.  In this project, it was possible for people from all over the work to communicate quickly and work round the clock.  New ideas were communicated instantly.  Changes or recommendations could be made in real time.

In many respects, the type of crowdsourcing evidenced in early projects such as the open software movement is anathema to the corporate culture.  While these movements are largely apolitical, the principles underpinning open source are in direct opposition to the capitalist framework.  Where businesses seek to sell products at a profit, open source movements are focused mainly on production.  By and large, any monies made are usually devoted to defraying some of the costs involved.  Arguably, the non-profit nature of the open source movement is what inspires many individuals to contribute their time and efforts.  It is a challenge for businesses to provide a framework for crowdsourcing that can promise the same rewards.  Working for the collective good has a great deal more cachet than working for the benefit of a multinational corporation.

In the following subsections, the development of crowdsourcing will be considered.  This will be achieved by identifying examples of both current and early practice.  Next, limitations of crowdsourcing will be considered.  This subsection will identify some of the drawbacks, as well as identify existing controversies.  Finally, the relationship between risk management and crowdsourcing will be outlined.  This section will provide a useful context for the discussion and analysis that follows later on in the dissertation.

Early Practice
As outlined in the previous section, crowdsourcing can trace its roots back to collaborative efforts such as the development of the Internet as well as the open source movement.  These examples stressed the collaborative nature of crowdsourcing, as well as its tendency to promote the public good over profits.  It is important to note, however, that crowdsourcing has been use in a number of commercial settings.  In this subsection, early examples of crowdsourcing will be discussed.  These examples will be drawn from a number of sources.  These will include knowledge-based projects such as the Galaxy Zoo initiative, as well as commercial endeavors such as apparel companies.

First launched in 2007, Galaxy Zoo had a simple objective.  Users were invited to survey and classify data, making simple determinations.  The data consisted of approximately a million images taken by a robotic telescope as part of the Sloan Digital Sky Survey (Source GalaxyZoon.org).  Participants would take a small section and review the images.  They looked for galaxies in these images and assigned them to one of two categories  elliptical or spiral.  While the task itself was not difficult, the sheer volume of data made its completion by ordinary means seem overwhelming.  Response to the project far exceeded expectations.  Initially it was predicted that the project would take three to four years to complete however, it was finished ahead of schedule and a second phase was recently launched (Charman-Anderson 2009).  The accuracy of the data has been confirmed largely in part by the high level of respondents.  While project coordinators initially anticipated that each image would receive a maximum of 10 views or clicks, the project generated 10 million clicks in its first month.  As Dr. Chris Lintott, a researcher overseeing the project notes  You can have confidence, as we can say, 100 of people think thats a spiral galaxy, so its really, really spirally (Charman-Anderson 2009).  The response to the project has been overwhelming, as enthusiastic volunteers from all over the world flock to the site to vet the data.

Wikipedia may be controversial in the classroom however, close to five million people consult it every month (Libert  Spector 2007, p. 3).  Wikipedia, which is based on the traditional format of an encyclopedia, is a web-based document that is created and maintained by a community of volunteers.  While the number of entries continues to grow daily, at present it is estimated that there is just over three million entries on a wide range of topics, which includes everything from pop culture to history, theoretical concepts to political discourses.  Wikipedia employs only five people however, its volunteers number in the hundreds of thousands, if not millions worldwide (Howe 2009, p. 109).  Due to the anonymity of its volunteers, as well as the ability of any visitor to edit most entries, the reliability of Wikipedia has been brought into question.  The site, however, has implemented a number of protocols in order to ensure its entries are accurate and guard against vandalism.  For example, some entries are closed in order to prevent tampering.  The entry for a public figure, such as George W. Bush, is semi-protected in order to prevent additions that might be libelous.  This means that anonymous users cannot make changes to the entry, while users who are both known and respected within the community are allowed to make changes.  The criteria are as follows  a user must have a confirmed account, as well as record of having made edits previously to Wikipedia.  In addition, users are able to make feedback about entries.  Other entries, which are not protected, may be flagged by Wikipedia.  These flags will indicate that users have raised some questions about the content of the material.  The warning may indicate that the information is either not reliable or may be biased.  While the user still needs to use his or her discretion, this method does help to guard against potential abuses.  Critics often accuse Wikipedia of dumbing down our culture however, as Howe and others point out, Wikipedia has succeeded where traditional encyclopedias have failed  Wikipedia lets users cut out the middleman and access the information they want freely (Howe 2009, p. 246).  This form of crowdsourcing poses a real threat to business, as it shows how easily services can be replaced.

Amazon is acknowledged as one of the pioneers in the field (Libert  Spector 2007, p. 11).  While the company is responsible for revolutionizing the face of retail both on and off-line, it has made an important contribution to the practice of crowdsourcing.  Amazons on-line reviews have become an important source of information to countless users.  Nothing shows up a products flaws or failings quicker than a round of poor reviews on Amazon.  Accordingly, a cautious consumer who is looking to purchase a new camera may be dissuaded from purchasing a particular brand or model if he or she sees that ten users have reported the item as being defective.  The reviewing process also allows the community to share its experiences and insights.  This process is one that appeals to an innate part of our humanity.  As Seth Godin points out in his survey of online reviews

I dont know about you, but I want in  . . .  I want to post my own reviews, I want to join this tribe.  If they ask me to pitch in, I will.  Im in.  Others will scoff and move on, wondering what the obsession is all about.  Thats what makes it a tribe, of course.  There are insiders and outsiders.  (Godin 2008, p. 63)

Crowdsourcing appeals to our innate desire to belong and share.  In a world that is becomingly increasingly fractured and isolated, it is easy to see the appeal of posting on-line reviews.  The clerk at Wal-Mart may not care what you think of the product, but there are others who do.  One feels kinship with others who face the same problems.  If ones view is voted as being helpful, there is a feeling of accomplishment or acceptance.  While it is possible that this process can be subverted, it is surprising how astute most users and commentators are at identifying bias.

In his book-length examination of crowdsourcing, Howe identifies an early example of the phenomenon in a t-shirt company.  Threadless was established by two friends.  Their business plan was simple.  They liked to wear cool t-shirts, and they knew that there was a market out there.  The challenge was to both design and promote desirable items of apparel.  The Internet made this possible.  Designers were invited to post their designs on the website, and users were invited to vote on them.  The voters were drawn from the community.  Designers would enlist their friends and supporters to vote for the products, but the audience continued to grow exponentially as the reputation of the company grew.  Consumers liked what they found on the Threadless site, and they told their friends.  People enjoyed the collaborative process.  While consumers always had the choice of voting with their wallets, Threadless offered a real opportunity to provide feedback.  As Howe observes,  Threadless really isnt in the t-shirt business what it sells is community (Howe 2009, p. 6).  Threadless was able to identify its target audience and sell to it successfully, using the basic principles of crowdsourcing.

Cambrian House, a Canadian-based company, was established in 2006, as a platform for crowdsourcing.  While the business model proved ultimately unsuccessful, the company had 50,000 members at its peak (Source  CambrianHouse.com).  Cambrian House recognized that there was a gap in the market and sought to address it.  Their strategy was to provide a clearinghouse for crowdsourcing.  Businesses that were unable to conduct crowdsourcing could hire Cambrian House to do the work for them.  The business failed, because Cambrian House was unable to sustain sufficiently high levels of input.  Many of the ideas generated were either unworkable or poorly conceived.  Ultimately, the business failed to build an appropriate community.  Howe acknowledges this failure is not surprising and places it in the context of the tech and web boom of the 1990s, where initiatives launched and failed with great regularity (Howe 2009, p. 279).

Current Use
The examples given in the previous section were selected to illustrate the earliest uses of crowdsourcing.  While the phenomenon is a relatively new one, it has been possible to define certain characteristics.  The projects initiated by the University of Oxford reflect the spirit of volunteerism and intellectual curiosity that inform many crowdsourcing projects.  The example of Threadless and Amazon show how crowdsourcing can shape and drive commercial ventures.  In this subsection, the focus will be on more innovative uses of crowdsourcing.  The discussion will consider how crowdsourcing has shaped the way we approach politics and the news, as well as identify the changes crowdsourcing has made.  In addition, new web ventures, including social media will be examined.  Finally, the relationship between Google and crowdsourcing will be considered.  This discussion will help identify emerging trends and directions in the practice of crowdsourcing.  It will also provide a context for the discussion and analysis that follows later on in the chapter.

In the US, the recent campaign for President demonstrated not only the power of the Internet but also the power of crowdsourcing.  Voters were able to raise issues and questions through various media platforms, and the immediacy of the web helped to shape issues and politicians responses.  Obama and his administration have led the way with their engagement with crowdsourcing and new media.  One example is the Change.gov website, which was established during the transition period between Obamas election and swearing in.  The site included a feature that invited users to submit their questions to the new President.  Administered in part by Google Moderator, the Open for Questions section enabled people to raise their concerns and identify the most pressing issues (Schonfeld 2009).  The feedback received on a range of topics, which includes healthcare and the military, continues to inform the Presidents approach to the issues.  In addition, as indicated previously in this chapter, developments are currently underway to adopt a crowdsourcing approach to policy making (Hoover 2009).  While administration have typically sought input from the public through a number of means, technologically supported crowdsourcing is likely to yield far more meaningful results than traditional methods, i.e. town hall meetings.

Crowdsourcing has also been adopted a grassroots democracy movement.  For example, in this past election NPR used Vote Report, which was hosted on Twitter, as a way of reporting on problems around the country.  The posts formed an interactive map that identified where there were long line-ups, broken voting machines or other problems (Source  NPR.com).  These reports helped to draw attention to problems with the electoral system, which were brought to light during the 2000 election following the hanging chad fiasco.  It would have been impossible for any news agency, either singly or collectively, to cover every voting station.  However, by enlisting reports from users all over the country, it was possible to identify where the problems were.  This use of crowdsourcing is invaluable, as it provides transparency in the countrys electoral processes.  Similar initiatives to Voter Report are being considered around the world.      
The impact of crowdsourcing has been felt in news media and reporting.  Crowdsourcing, which is often known as citizen journalism, has helped to shape the way events are reported on.  For example, breaking events, such as terrorist attacks or natural disasters, are often communicated by eyewitnesses, through a variety of mediums, including telecommunications and the Internet.  There is a growing tendency amongst newspapers to give its readers increased scope to submit articles for publication (Howe 2009, p. 146).  While these items may range from first-person accounts to press releases, the focus on the individual is an important change.  While newspapers were once dismissive of such contributions, they now recognize their importance (Howe 2009).  Crowdsourcing not only provides them with access to breaking news but also ensures a higher degree of relevancy amongst readers.  It also helps to provide a more inclusive and representative view.  While traditional media reflects the perspective and concerns of a largely homogenous professional class, crowdsourcing allows for different voices to be heard.  As Clay Shirkey (2008) points out  The mass amateurization of publishing undoes the limitations inherent in having a small number of traditional press outlets (p.65).

In many respects, social media has evolved alongside crowdsourcing as a means of providing a context and format for the generated content.  As Tapscott and Williams (2008) observe, the current generation differ significantly from previous generations  This is the collaboration generation for one main reason  Unlike their parents in the United States who watched twenty-four hours of television per week, these youngsters are growing up interacting (Tapscott  Williams 2008, p. 47).  This generation has a very different set of expectations.

Rather than being passive recipients of mass consumer culture, the Net Gen spend time searching, reading, scrutinizing, authenticating, collaborating, and organizing (everything from their MP3 files to protest demonstrations).  The Internet makes life an ongoing collaboration, and this generation loves it.  They typically cant imagine a life where citizens didnt have the tools to constantly think critically, exchange views, challenge, authenticate, verify or debunk.  While their parents were passive consumers of media, youth today are active creators of media content and hungry for interaction.  (Tapscott  Williams 2008, p. 47)

The so-called Net Gen has grown up with the expectation that their views will be heard.  This is one of the reasons why social media has been so important.  Sites such as Twitter and Facebook provide users with the opportunity to share their opinions and articulate the issues that are important to them.  Business is recognizing this.  Consequently, companies have developed a presence on social media and other networking sites in order to provide consumers with a way of showing their support and providing valuable feedback.  In addition, platforms such as blogs provide users with an opportunity to share their views, through either posts or comments, that are then sourced by businesses via search engines.  Social media has, in many respects, been responsible for refining the process of crowdsourcing.  For example, a movie executive need only enter the name of his or her latest film to access the most up-to-date consumer feedback on Twitter.

For many, Google represents the embodiment of crowdsourcing  Google is the runaway leader in search because it harnesses the collective judgments of Web surfers.  Its PageRank technology is based on the idea that the best way to find relevant information is to prioritize search results not by the characteristics of the document, but by the number of sites that are linking to it (Tapscott  Williams 2008, p. 41).  Howe describes it as the best indicator of the long-term viability of the practice (Howe 2009, p. 279).  Google has a long tradition of crowdsourcing  not only does it offer cash rewards for new ideas, but also it tests most of its developments, from Gmail to Google Documents, using input from the general public.  Google has released a new crowdsourcing initiative.  It has been determined that the company will make use of public input to develop its map data (McGee 2009).  There are several initiatives underway.  The first is to invite users to submit data for 3D mapping.  The second is to encourage users to identify any elements of the map that require edits.  Both of these initiatives are poised to draw on local expertise and interest in order to ensure that mapping project is completed quickly and efficiently.

Limitations
The use of crowdsourcing is not without some criticism and even controversy.  In this subsection, a number of issues will be considered.  Firstly, the ethical implications of crowdsourcing will be identified.  Secondly, the economic factors will be discussed.  Thirdly, the social ramifications will be debated.  This discussion will be augmented by the analysis conducted elsewhere in this section.

There are a host of ethical issues that accompany the rise of crowdsourcing.  Some are generational.  For many, the validity and reliability of a document is derived in part from its authorship.  A sole identified author who can claim to the authenticity and originality of a specific document serves as testament to its reliability.  For many, the idea of a document created from multiple uncredited sources is comparable to plagiarism.  Others argue that crowdsourcing devalues the contribution of the individual and makes it more difficult to support traditional research.  The cost-effectiveness of crowdsourcing potentially devalues the work of researchers and other professionals.  Equally, intellectual property is devalued and subject to abuse.  Finally and most importantly, crowdsourcing further disenfranchises those at the margins of society.  Ones access to the Internet, computers, and other forms of technology determines the level to which one can participate in crowdsourcing.  Those who are economically advantaged often a disproportionate level of influence.

The economics of crowdsourcing are not always straightforward.  In a project like Galaxy Zoo, crowdsourcing was a highly successful way of processing the available data in a timely and cost-effective manner.  Volunteers enjoyed the prestige of being involved in the project.  For many, their contribution was a secondary activity, similar to a hobby.  The failure of businesses like Cambrian House shows that crowdsourcing can be a costly venture.  The business was unable to develop a business model that generated meaningful results for minimal financial reward.  The ideas Cambrian House tapped into were largely worthless no one could be convinced to provide useful ideas for free.  Most importantly, the successful management and integration of data obtained from crowdsourcing has proved too much of a challenge for many businesses.  As the Gartner Research findings, cited elsewhere in this chapter, indicate  many businesses do not have the time or resources to make good use of crowdsourcing initiatives.

Finally, the social implications of crowdsourcing are still being assessed.  While crowdsourcing does promise greater transparency, it does fail to engage with all members of society.  Crowdsourcing is chiefly the domain of the privileged and educated classes.  As well, the views represented by this group are not necessarily accurate.  Crowdsourcing runs the risk of clouding the issue in many instances, if there is overrepresentation of a particular group or point of view.

Risk Management
Risk management may be defined as follows.  In general terms, it is an organized process that identifies, analyses, and responds to risk.  It does so by applying risk management principles and strategies at to specific process or project.  In this context, the process or project may refer to either an ongoing or specific instance of crowdsourcing.  According to the classification provided by noted expert Laurence Krantz (quoted in Tusler 1996), risk is characterized by a combination of constraint and uncertainty.  These usually manifest as limitations and are faced by most businesses and corporations during the development new projects or implementation of current ones.  Limitations can be created by social, environmental, technical and logistical factors.  Because limits exist in every context, organizations need to find ways to limit the consequences of these constraints and develop strategies in to reduce uncertainty.

Risk management is a multifaceted process.  The first step is to measure or assess the risk factors.  The second step is to develop a strategy to manage or control the risks identified.  Once the risks have been assessed, it is necessary to develop a prioritization process to determine what risks carry the greatest loss and the greatest probability of occurring andor recurring.  These risk factors are a top priority and are dealt with first however, risks with lower probability of occurrence and lower loss are handled next.  The level of a risk is determined by the law of large numbers.  This principle simply states that situation outcomes become more predictable as the number of situations increase.  To implement this prioritization may be a difficult course of action.  Balancing between risks with high probability but lower loss against risks with high loss but lower probability of occurring can often be complicated.

Four Aspects of Risk Management
Avoidance  As the name implies, the avoidance technique consists of refraining from potentially dangerous activities.  In this approach, any activity that carried a risk of injury or loss would be avoided.  For example, a school or community may choose to adopt the avoidance approach when developing a playground.  Certain pieces of equipment, such as slides, may be prohibited since their use carries a high probability of injury.  Users may fall off the sides, slip on the ladder going up, or hurt themselves when they land at the bottom.  Considering these risk factors, it may seem sensible to prohibit slides in favor of safer equipment.

Avoidance may appear to be a failsafe approach to avoiding risk however, too much avoidance sometimes results in missing potential gains.  Returning to the example of the slide in the playground, this equipment might help children develop their sense of balance and build strength.  Some might argue that exposure to moderate levels of risk would ultimately benefit the children by allowing them to learn from the situation.  Therefore, it is important to carefully weigh the advantages and disadvantages before adopting the avoidance approach.

Reduction  This approach relies on finding methods to reduce the risks or the severity of any potential loss.  Since almost every situation carries a certain amount of risk, this technique allows people to minimize the consequences while still pursuing a wide range of activities.  For example, any motorist risks injury or even death every time he or she gets behind the wheel.  It is not feasible, however, for most of us to stop driving, as many of us depend on our vehicles in both our personal and professional activities.  Therefore, we take certain measures and precautions in order to ensure our safety.  For example, we can avoid unsafe activities, such as consuming alcohol or speeding, and reduce the potential hazard to our health and well-being.  While we cannot control what other drivers do, it is possible to develop our skills and learn to drive defensively.  This approach depends upon a full understanding of the existing risks and a carefully thought out plan to minimize them.

Prevention  As with the above-described approach, the prevention technique seeks to minimize risks through careful planning.  This method identifies measures that will prevent loss or risk.  Returning to the example of the playground slide, this technique would consider the inherent risks and develop a method of addressing them.  For example, there is a possibility that a child might jump or fall from the top of the slide.  One way to prevent this from occurring would be to install a cover over the top of the slide.  This would control the environment and prevent any user from being injured in a fall.  While children would no longer be able to stand at the top of the slide, the cover would not interfere with the safe use of the slide.  It is important that preventative measures do not interfere with the activity itself otherwise, the positive effect would be mitigated.

Separation  The separation technique identifies risk and seeks to minimize hazards by separating them.  For example, divided motorways reduce the risk of head-on collisions.  This solution embodies the nature of the separation technique.  It recognizes that motorists driving at high speeds may misjudge the distance and time needed to safely overtake vehicles.  By creating divided roads, the potential for risk is separated.  The two directions of traffic are divided, which removes the probability of head-on collisions.

Four Stages of Risk Management
This section will identify and discuss the four stages involved in preparing for effective risk management.  These include risk identification, risk quantification, risk response and risk monitoring and control.  As indicated previously, risk management has changed significantly since its emergence in the 1970s when the primary focus was the conservation of resources (Tye 1980).  The impetus behind risk management has shifted to developing an effective strategy that allows an organization not only to protect itself from loss but also grow and adapt to a changing market place (Egbuji 1999).  Nor is risk management the sole preserve of specialists or consultants.  Managers at every level within an organization need to develop effective strategies to help them identify and mitigate the effect of risk on operational activities (Robinson  Robertson 1987).  In this post 911 era, our understanding of risk management has expanded far beyond the fiscal security of board members, executives and investors (Mundy 2004).

Risk Identification  In the risk identification stage, as its name implies, people involved identify and name the risks.  Risk identification is basic step in the risk management process, but is plays an essential role in effectiveness of any management approach (Tchankova 2002).  A workshop approach is often the best strategy to involve and engage different levels of management.  A workshop approach would allow for open discussion and has the potential to either identify or avoid potential bias.  Ideally, the views and experience of the group would be diverse enough to ensure that a balanced outcome is achieved.  Brainstorming or listing risks are two strategies.  It should be noted, however, that some research suggests that risk identification needs to evolve beyond the production of lists (Hillson 2003).  The risks identified can often seem overwhelming.  Hillson recommends using a risk breakdown structure (RBS).  RBS is hierarchical and allows an organization to identify common themes and the distribution of risk (Hillson 2003).  Different types of risks are usually involved in the businesses.  As Turbit (2005) points out, generic risks exist in all types of projects, as they are inevitable to every company.  Early risk identification, in conjunction with a comprehensive mapping of risk factors, enable an organization to overcome bias and identify appropriate measure to avoid or minimize the consequences of risk.

Risk Quantification  The risk quantification stage follows risk identification.  It is in this particular stage where the different risks and its impacts to the project are assessed.  The quantification of risk may adopt either a commonsense or a rigorously scientific approach.  Equally, the approach may fall somewhere between the two.  Many managers conduct these functions during the course of their daily activities while most have overcome their resistance to management science, a preference for commonsensical approaches persists (Leaman 1987, Galloway  Funston 2000).

Turbit (2005) provides a matrix, illustrated in Figure 2.3, which helps determine the effect of potential risks.  It is important to consider both the probability and the consequences of a

Figure 2.3 Risk Impact Matrix (Turbit 2005)

risk factor in order to effectively determine its importance.  According to Turbits matrix, a probability factor of 1 or 2, coupled with an impact factor of 1 or 2, would result in a low-level risk assessment.  However, a probability factor of 2 or less, when coupled with an impact factor of 3 or 4, would result in a high-level risk assessment.  Many project managers rely on some type of matrix in order to help them assess and evaluate risk (Cervone 2006).  One must consider the probability and impact in determining whether something is a low, medium, high or critical risk.  This process enables the project manager and the organization to respond appropriately to different risks and assess the level of harm they may cause a project.

Risk Response  Once the risks have been identified and quantified, it is possible for the project manager to develop a response.  The most effective project managers develop strong working relationships with stakeholders and maintain open lines of communication (Cervone 2006).  This helps ensure that not only the organizations needs are met but also that all stakeholders are involved and committed to the process.  Turbit (2005) identifies four possible strategies for developing an effective response to risk
Avoid the risk
Transfer the risk
Mitigate the risk
Accept the risk
When adopting the avoidance strategy, a company would seek to excise the risk factor from the project.  Alternatively, the company may choose the second strategy, which is to transfer the risk.  In this instance, the risk would be assigned to someone else.  For example, the ruling government would be made responsible for providing stability and penalized for any disruptions to the companys activities in the country.  Another alternative would be to mitigate the effects of the risk.  This would consist in taking steps to ensure that the impact or likelihood of a particular risk could be reduced.  In this instance, an organization may choose to delay its decision into a politically volatile territory, instead waiting until the situation stabilized.  The fourth and final strategy consists of accepting the risk.  In this instance, the political instability would be accepted as project risk.  It is important to note, however, either that risks should only be accepted if the consequences are minimal or if the potential benefits far outweigh the potential losses.  Regardless of the strategy adopted, it is important that the project manager develops a risk-response plan.  This plan will allow the project manager to clearly identify the strategy adopted and what actions are needed.  This process needs to involve all stakeholders and should list exactly what an organization needs to do, as well identify individual responsibilities and time guidelines.

Risk Control  The final stage in planning risk management is risk control.  In this stage, the project manager, along with other stakeholders, monitors the identified risks and considers how they are affecting the organization.  Whether the project is in the field of construction or medicine, an effective risk strategy can help maintain both the efficacy and reputation of an organization (Mills 2001, ODonovan 1997).  It is essential that corporations within the industry develop appropriate responses to risk and effectively evaluate its likely effects.  In this instance, it is especially important to guard against bias.  An organizations long-term interests are not served for inward-looking strategies.  It is important that organization recognize the importance of public perception.  It is equally important that corporations recognize that their stakeholders stretch far beyond the executive board members and investors.

Dissertation Aims  Objectives
The dissertation has the following aims
Identify current practice in crowdsourcing within industry
Determine the level of risk involved in the practice and,
Identify possible strategies for dealing with this risk.
The following steps help achieve these aims.  The first aim will be addressed in the literature review and findings chapter, which will provide a more detailed overview of the history and use of crowdsourcing in a range of organizational contexts.  The second aim will also be addressed in the literature review and finings chapter, which will provide a more detailed overview of risk management and its application to crowdsourcing in a variety of organizational contexts.  The third aim will be realized in the analysis chapter.  The findings of the research will be carefully considered and best practices identified.  The final chapter will made a series of practical strategies for mitigating risk in crowdsourcing.

Theoretical  Organizational Context
In order to reap the rewards of crowdsourcing, it is important that businesses take an active role in overseeing and managing the process.  As  practitioners and theorists observe,  If collaboration isnt done right, it had best not be done at all (Libert  Spector 2007, p. 5).  According to research conducted by Gartner Research, over half of all Fortune 1,000 companies will have made some attempt to integrate crowdsourcing into their marketing approach by 2010 however, Gartner also predicts that most of these efforts will be so poorly managed that the results will be of no use to anyone (quoted in Libert  Spector 2007, pp. 5-6).  The old maxim  Garbage in, garbage out certainly seems to apply here.  In order for a business to successfully integrate crowdsourcing into any aspect of their business, whether it is research and development or marketing, it is important that they first lay the groundwork.

Firstly, it is essential that the objectives be clearly defined.  For example, the company may want to gauge consumer reaction to a new product or advertising campaign.  The organization needs to consider the context and form for this feedback, i.e. should the analysis be superficial or more in depth  As recent developments in marketing have shown, the Internet has all but replaced the traditional focus group.  In this instance, crowdsourcing may be a useful way of achieving this type of detailed response.  It is important, however, for the business to consider the limitations of this type of project, as well as its ability to see the project through.

Secondly, it is important to identify the appropriate crowd.  While much of crowdsourcing is random and chaotic, it is worth noting that the most successful approaches rely on pre-existing communities.  As Howe points out  Crowdsourcing efforts generally attract people both with and without professional credentials (Howe 2009, p. 28)  While both groups may be capable of providing meaningful input, there is no guarantee that they will find the project on their own.  It is important that a business knows how to market and target its desired audience, or else the feedback obtained may be of little use.

Thirdly, the business needs to determine what it can offer participants.  Input obtained via crowdsourcing may be paid or unpaid.  The most successful uses of crowdsourcing usually involve a sense of community.  For some, the sense of community may come from shared interests or a professional curiosity.  Other organizations may benefit from the perceived prestige of the project.  For example, University of Oxford and NASA.  The business needs to be clear about what they are offering participants.  Although it does not need to be monetary, it is important that there is some sort of exchange that will be valued by the participants.

After listing all these challenges, many may ask why crowdsourcing is worth the effort.  If managed properly, crowdsourcing can have a dramatic impact on a companys bottom line.  It can save money, build brand loyalty, research and develop new products quickly and effectively and revolutionize the scope of a business.

Potential Contribution to the Field of Knowledge
As indicated earlier in this chapter, this dissertation is poised to make an important contribution to the field of knowledge.  While the application of crowdsourcing to the business context is widely acknowledged and valued, its relationship to effective risk management has, thus far, been under examined.  As shown in the examples cited previously in this chapter, crowdsourcing can help an organization to spot weaknesses or failures in its products.  Crowdsourcing is particularly useful on a large project, which would be unwieldy for a small team of paid employees to address.  Consequently, a successful protocol for the development of crowdsourced risk management would have tremendous value in the business world.

Dissertation Outline
This project consists of six separate chapters.  Each plays a unique role in communicating the findings of the researcher and establishing the projects recommendations.  In this section, a brief overview of each chapter will be provided.  This overview will identify the chapters chief objectives, as well as their contribution to the project as a whole.

Introduction
This introductory chapter has laid the groundwork for the discussion that follows.  It began by introducing the research question and the larger context for the study.  It briefly outlined the practices of crowdsourcing and risk management.  It identified the projects aims and objectives as well as its potential contribution to the field of research.  The chapter plays an important role, because it introduces and prepares the reader for the research that follows.

Literature Review
In this chapter, the author has an opportunity to demonstrate both an awareness of and engagement with current research in the field of study.  This chapter will outline approaches to crowdsourcing and risk management drawn from a number of sources, including academics and practitioners.  The material contained here will be drawn from reputable academic sources.  These will be vetted by either peer reviews or the prestige of the editorial board.  These sources include but are not limited to journal articles, monographs, and text books.  This chapter will provide the critical context for the findings and analysis that follow in the next two chapters.

Methodology
In this chapter, the research methods adopted for this project will be identified and evaluated.  At this point, it has been decided that the research will make use of secondary data, i.e. published material, and benchmarking.  Benchmarking will provide a useful framework for identifying and categorizing best practices around the world.

Results
In this chapter, the findings of the research will be presented.  The author will identify a number of different businesses and discuss at length their respective approaches to crowdsourcing.  The findings will be applied to the context of risk management.  This chapter will provide the basis for the following discussion and analysis of the research.

Analysis
In this chapter, the findings will be subjected to a rigorous analysis.  The objective of this chapter is to identify best practices within the industry and identify workable approaches.  The analysis will identify both the strengths and weaknesses of these approaches and suggest possible solutions.  This process of benchmarking will pave the way for the recommendations that follow in the final chapter.

Conclusion
The final chapter provides an opportunity for reflection and assessment.  It will begin by providing a concise summary of the research.  Next, it will identify the key findings of the project.  Following this, it will make a series of workable recommendations based on the findings and analysis conducted earlier in the report.  Finally, it will reflect on the projects overall contribution to the field of knowledge and identify possible avenues for future research.

Summary
The practice of crowdsourcing has grown up alongside developments in the Internet and technology.  Crowdsourcing would be impossible without the immediacy of the web, and likely unnecessary without the relatively recent boom in technological advancement.  At its best, crowdsourcing succeeds because it builds communities and enables them to contribute in a meaningful way to the development of knowledge.  Crowdsourcing is often an economic and efficient way to tackle data that might overwhelm any organization.  As the examples cited, involving NASA and the University of Oxford, indicate crowdsourcing can quickly mobilize a large group of geographically and culturally diverse people to tackle a specific problem.  It can help software developers to identify and fix flaws that might only emerge after months of testing.  It can also help ensure that local knowledge of an area be captured and attributed.  Crowdsourcing has a number of commercial applications as well.  It can help a business to narrow its focus and become more responsive to consumer demand.  In the public sector, it can help policy makers to quickly identify what issues matter most to people.  Crowdsourcing gives people a voice and a way of interacting.

This research anticipates that the application of crowdsourcing will have important benefits for the field of risk management.  It aims to identify these benefits through a targeted study of best practices with the business sector.  These findings will help to create recommendations that will be of use to both businesses and consumers.