The MGS Blog

Wednesday, April 6, 2016

Crowd and Microsourcing, who wins, who loses?

Microsourcing, who wins, who loses? Gefen & Carmel (2008) suggest microsourcing works well for the small supplier, and Lehdonvirta's research appears to confirm it (look at slides 9 onwards). Microworkers appear to be treated more equitably.

Gefen & Carmel (2008) show that cost is a significant driver towards microsourcing, but access to skills seems to be a strong incentive for customers to source directly from micro suppliers. Why do the most sophisticated (US) markets seek these offshore micro-suppliers? Principally to address resource shortages in their local markets and furthermore, customers return to the same supplier if initially satisfied and continue to pay a ‘fair price’. The satisfied customer returns again and again, caring less and less if the work is offshore, caring more that they have access to the specialist wherever they are. The world hasn't been 'flattened' (Friedman, 2005), but it appears to be 'flatter'.

  • Friedman, T. L. (2005) The World Is Flat: A Brief History of the Twenty-first Century, Farrar, Straus & Giroux.
  • Gefen, D. & Carmel, E. (2008) Is the World Really Flat? A Look at Offshoring at an Online Programming Marketplace. MIS Quarterly, 32, 367-384.
  • Carmel's student microsourcing exercise (