Sustainability, Entrepreneurship, and the Future of Value with Eric Lowitt
A new trend in the corporate pursuit of sustainability has emerged: crowd-sourcing via social media.
While adoption has been easy, gaining useful ideas has not. By looking at three recent efforts -- GE's Smart Grid challenge, eBay's Green Team, and a leading European retailer's green customer foray -- three rules for companies considering crowd-sourcing of sustainability ideas are coming into focus.
Recently one of Europe's leading retailers launched an online campaign which sought ideas from its customers as to how the company could further its sustainability efforts. I spoke with the company's sustainability lead under the condition of anonymity to learn how the drive for ideas went. She noted that "the response rate was higher than expected, but the ideas were either generic or impractical." A sampling of the ideas included "use less energy," "recycle more," and "eliminate packaging." They have since closed the campaign with minimal to-dos stemming from the campaign.
Compare the retailer's experience with crowd-sourcing efforts at GE and eBay. GE launched the "GE ecomagination Challenge: Powering the Grid" in July 2010 with much fanfare. After all the company, along with four prominent venture capital firms, put up $200 million to fund ideas from society writ large to accelerate the development and adoption of a smart grid. GE created a new website for the effort, incorporated aspects of social media, and installed a committee to decide which ideas to fund.
Between July 13 and September 30, 2010, nearly 4,000 ideas were submitted; collectively these ideas garnered over 70,000 comments from nearly 70,000 registered users. Every idea was publicly available to both review and support. Jeff Immelt publicly announced the winners of the ecomagination Challenge on December 2nd.
Like GE, eBay created a Green Team program and website to tap into the wisdom of crowds. The program's mission is to "inspire the world to buy, sell and think green every day." To date, over 300,000 sellers -- individuals who sell goods on eBay's platform -- have signed up to share ideas and views aimed at making eBay a greener sales partner.
The eBay Box, a corrugated cardboard box designed to be durable enough to be used by sellers over and over again, is among the ideas that came from this community and have been rolled out.
So how can companies emulate GE and eBay's success while avoiding the challenges faced by the European retailer? Follow these three rules:
1. Be painfully clear about the results you want from your campaign.
The European retailer's campaign fell flat in part because it wanted basic ideas. While they might not have explicitly said that, they didn't provide any rules of substance to guide their participants' thinking. GE clearly indicated the three categories of ideas they sought (ideas for Renewable Energy, Grid Efficiency, EcoHomes/EcoBuildings). These guidelines served a dual purpose: they led to self-selection of respondents (you're less likely to respond to a smart grid call for ideas if you aren't versed in the smart grid) and they directed respondents to submit best thinking in a focused area.
2. Embrace transparency.
Transparency helps promote trust -- it's easy to trust someone who doesn't have anything to hide. If your company runs a campaign but doesn't publicly display the results, then [potential] participants are left to draw one of three conclusions. Either your company: didn't receive any ideas, isn't paying enough attention to the "what should we do after we receive ideas" activity or doesn't believe the ideas received are good enough to be published. In each of these three scenarios, the observer is less likely to participate. To nurture dialogue among participants and embrace transparency, GE and eBay created websites to document the ideas submitted by participants.
3. Link the campaign to co-value creation.
GE and eBay implicitly demonstrated their belief that participants' time is valuable. They did this by asking participants to contribute their best thinking to create initiatives that can not only enhance the company's financial and sustainability performance, but also enhance an aspect of participants" lives. In GE's case respondents had the opportunity to pitch ideas in return for funding to pursue those ideas. And in eBay's case, sellers were asked for ideas that would help grow their businesses in a sustainable manner -- a classic example of aligning eBay's sellers' interests with the company's interests.
Crowd-sourcing sustainability ideas through social media is a low-risk, low-cost tactic to enhance sustainability performance. By following these three rules, companies will increase the likelihood of a successful crowd-sourcing campaign.
Eric Lowitt is a student and teacher of strategy and sustainability – how companies grow, innovate, and become more agile by embracing sustainability. His first book on the topic, The Future of Value, will be published by Jossey-Bass, a Wiley imprint, in September 2011.
Learn more about Eric Lowitt at EricLowitt.com and follow him on Twitter @EricLowitt
For more information, please visit Eric's TNNWC Bio.
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