Before reading, this short video will help you to understand what the crowd is all about.
For the last year, I’ve been hearing a lot about crowdfunding as a new, alternative source of finance for start-ups. The more I’ve learnt about it and experienced it myself, the less I see it as an “alternative” or even “disruptive” financing solution nor do I believe that start-ups are the only ones who should consider it.
I believe the biggest impact of the crowd will not be financial but more in redefining business relationships between employers, employees, suppliers, partners, investors and of course, customers. I also believe that this is one of the biggest challenges in its adoption. When it comes to “relationships” in a business context, people often feel uncomfortable. Have you ever been in a meeting and one person walks into the room and everyone else becomes silent. That one person completely changed the dynamics of the meeting, without even saying a word. We know it happens sometimes but organisations are not very good at dealing with it.
Let’s think of a few examples of how the “crowd” could impact existing business relationships.
Imagine that a company decides to use crowdsourcing and/or crowdfunding to experiment with how the crowd can help with the launch of a new product or in reshaping its commercial strategy. Before, they used to use internal resources to conjure up new ideas and then take them to market and sell to customers. In the new model, it could well be that the idea comes from outside the company. Take a look at this example for a Belgian beer brand http://www.all-challenges.com/re-think-the-strategy-for-martins-pale-ale-beer/
In many cases, employees’ are inherently sceptical about ideas from “outside”. Have you ever heard colleagues talk about external consultants, “those guys don’t know anything about us or our business, why are we asking them?”
How will the product manager feel when his product is innovated from outside the company? What about the sales guy? He gets commission for selling the products but what happens when the product is essentially being pre-sold through a crowdfunding campaign?
I’ve noticed myself that loyalty between employers and employees isn’t what it used to be. Whereas initially I thought that was a negative thing, perhaps it’s not. It may make it easier to imagine a business environment where people work for multiple companies and not as employees of just one. Of course, the concept of consultancy isn’t new but what I’m referring to here is a much bigger proportion of the workforce which would be freelance and sell skills/competences for specific tasks rather than work for large consulting brands.
Teleworking and other trends are making it easier to move this way as it is already creating some physical distance between employees and employers as well as between colleagues.
When clients become investors, the dynamic of that relationship also changes. I’ve seen that myself in projects I’ve helped. Through crowdfunding, a community is created which needs to be nurtured to continue after the crowdfunding campaign is finished. People invest in the people and projects they believe in and this creates expectations on both sides. It is no longer just a financial transaction where I get the product and the company that sold it gets the cash. Now I am far more interested in who is this company, why do they do what they do, what impact do they create?
It’s a subject, which fascinates me. Rather than simply focusing on the pragmatic tools of the collaborative economy, we also need to look at the changing human dynamic which it creates as this is the key in change management. People will need to feel comfortable with the new norm before they edge towards it.