Using the crowd to develop and assess business opportunities
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This document discusses using crowds to develop and assess business opportunities. It provides examples from TDC A/S of aggregating stakeholder insights to more accurately estimate performance measures than individuals. Crowds can predict issues better than firms and also assess business opportunities through a crowd approval model evaluating internal and external fit. An iterative process is described of using crowds for ideation, assessment, selection and development of initiatives to interact with management. The possibilities of using crowds in TDC A/S are discussed.
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Using the crowd to develop and assess business opportunities
- 1. Using the crowd to develop and assess business opportunities Carsten Lund Pedersen (Industrial PhD fellow) & Mathias Faaborg (TDC Group) 1 - Applications and experiences in TDC A/S
- 2. Timely firm responses to ambiguous issues are essential.. 2 “Firms often fail to anticipate and suddenly discover that a fleeting opportunity has been missed or that survival of a product line is threatened. Typically, at the ‘moment of truth’ neither the causes nor the possible responses are clear; the firm confronts an unfamiliar and often threatening event” (Ansoff, 1975, p. 22).
- 3. … but stakeholder crowds can help us predict issues. 3 - A snapshot of the current data collection in TDC A/S* *As the data collection is ongoing work-in-progess, the specific results and measures are expected to change.
- 4. Surprising insights from data already collected in TDC. 4 TENTATIVE FINDINGS*: 1) Both frontline employees and customers have surprisingly accurate estimates of certain performance measures, when they are aggregated to a crowd level. 2) Frontline employees are slightly more accurate in estimating the recommendation score than customers. 3) The most accurate estimates are obtained when the estimates of both customers and frontline employees are combined. 4) A case for aggregating stakeholder insights. 5) ”Diversity trumps ability” (Page, 2007). *The data collection is still work-in-progress.
- 5. It is the crowd that is correct – not the individuals. 5 - Explanation for this phenomenon: Signal and noise = Actual recommendation score = Average of crowd predictions
- 6. Planning, Doing and Learning: The need for interaction. 6 Andersen (2013)
- 7. Crowds can also assess business opportunities… 7 Crowd Approval Score = Internal Fit x External Fit. The model is based on firms striving to maintain a coherent fit with the environment. The multiplicative relationship penalizes a lack of both internal and external fit – and rewards the synergy of having both. 0 1 2 3 4 5 6 0 1 2 3 4 5 6 E x t e r n a l f i t Internal fit Crowd Approval Score
- 8. … and further develop chosen initiatives in an ongoing and iterative interaction with relevant managers. 8 •Employee ideas. •Management ideas. •External ideas. Ideation • Crowd Approval. • Cluster analysis. • Identification of segments. Assesment • Initiative chosen by crowd. •Management adjusts based on analyses. Selection • Crowd ranks features. • Conjoint analyses. Development
- 9. What are the possibilities in TDC A/S? Experiences and prospects of using crowds 9
- 10. Wisdom of one vs. Wisdom of the crowds 10 June 29, 2007 “Apple has attracted much attention at first, but they have still remained a niche manufacturer. That will be in mobile phones as well” A. Vanjoki Chief Strategist, Nokia