Six Solution Approaches of New Businesses in the Digital Age – Part 1

Many interesting business ideas and solutions to customer needs or customer jobs-to-be-done have emerged in the digital age, an age which promises ubiquitous and high-speed connectivity is closer to being achieved, hundreds of millions have inexpensive and good enough smartphones in their pockets, many can access resources and solutions on the cloud and more than a billion people are on social media.

We can observe some ‘approaches’ startups and new businesses use while framing these solutions to customer jobs-to-be-done. These approaches seem to be tailored to the digital age. These approaches in my opinion will become increasingly common (some already are) and may have truly disruptive potential. I list six such solutions that I have observed. I list 3 here and 3 in the next.

1. Crowdsourcing

“No matter who you are, most of the smartest people work for someone else.” – Joy’s Law by Bill Joy, Co-founder Sun Microsystems

Crowdsourcing approach enables you to tap the ideas/wisdom/knowledge of talented people from all over the world. Very interesting businesses and organizations have been built as a consequence of people from all over the world being able to connect with each other over the Internet and have used this Crowdsourcing approach to build lucrative and high impact businesses and organizations.

Wikipedia has become one of the most visited websites in the world where people write articles for free and edit for free. In the process, it has toppled big incumbents like Encarta and Britannica.

Quora, the popular question and answer site has developed a cult following among many users. In fact, many answers written on Quora have been syndicated and published in mainstream media like Forbes.

Github is the largest code hoster in the world with over 9 million users and over 21.1 million repositories. Stackoverflow is the go-to website for answers on a range of topics in Computer Programming. The website has more than 9 million questions and around 92% of the questions have been answered in a median of 11 minutes.

OpenIDEO is an online platform of famed design organization IDEO that crowdsources ideas from people which then pass through different stages, all the while relying on the ‘crowd’ to filter solutions and choose the best ones that pass through in each stage.

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The configuration of the crystal structure of the Mason-Pfizer monkey virus (M-PMV) retroviral protease, an AIDS-causing monkey virus was an unaccomplished goal of scientists for 15 years. Foldit is an online puzzle video game on ‘Protein Folding’ which calls upon anyone to solve science puzzles for fun. Foldit players produced an accurate 3D model of the Enzyme within 10 days!

NASA after 35 years of research on Solar Particle Events (SPEs) had “no method available to predict the onset, intensity and duration of a solar particle event.” They posted the challenge on Innocentive which has more than 250,000 registered solvers who try to solve challenges for as low as a few thousand dollars to as high as $1 million. You don’t have to be a PHD to solve these complex challenges. In fact, it wasn’t an Astrophysicist who solved this particular problem. It was a retired radio frequency engineer called Bruce Cragin whose approach enabled prediction of SPEs eight hours in advance with 85% accuracy. His cash award was $30,000 – chump change for NASA.

Duolingo is a free language-learning platform with courses in 22 languages. Launched just over 3 years back, it has over 60 million customers. It is disruptive to language-learning software providers with a unique solution. Students take step by step lessons and are asked to practice what they have learnt by translating sentences. Here is the awesome stuff. Duolingo pulls these sentences from websites which need to be translated to another language. It gives the same sentence to multiple users and a software compares the answers and chooses the best translation. Many such sentences are pieced together to translate an entire document. According to the founder Luis Von Ahn’s answer in Quora, Duolingo charges customers like CNN and Buzzfeed who want to translate documents from English to another language. It is said that Duolingo’s translation is better than automated translation services but a little short of professional quality. MIT Technology Review dubbed it the cleverest business model in online education.

The above examples reveal the following:
1. A large pool of high quality talent can be accessed and tapped
2. You can often find someone with an answer to every question
3. People will create and share knowledge/insights for free
4. Money is often not the primary motivator for people to share their knowledge. Some do it for fun like in Wikipedia or Foldit. Many do it for the reputation like in Github, Quora, OpenIDEO etc.

We can expect Crowdsourcing to find broad applications in
1. Problem Solving
2. Sharing and Broadcasting Information
3. Empowering people through unique insights
4. Content curation
5. Collaborative New Knowledge creation
– solutions that can be applied in many Industries

2. Gamification

“The obvious objective of video games is to entertain people by surprising them with new experiences” – Shigeru Miyamoto, creator of Super Mario Bros

Gamification is the use of game mechanics in non-game contexts designed to engage users and keep them hooked into continue doing the activity without losing interest. The game of course derives from the Video Game Industry which is adept at holding the attention of gamers for long hours together. If you had played Temple Run, you probably ran your character for many hours. If you had played Angry Birds, you probably flung birds at pigs for dozens of levels and probably even downloaded subsequent versions of the game.

More and more businesses are being built online and for many of these businesses revenues often depend on users being engaged spending a longer time on the websites. As a result Gamification has increasingly been receiving a lot of attention.

The user is more motivated to do the important but previously boring tasks. Users end up achieving more ‘milestones’ and convert tasks into habits. Gamification enables the user to visualize the distant outcomes to see his progression.

Khan Academy uses Gamification to motivate students to practice a lot of problems without losing interest. A typical message that a kid gets on Khan Academy after solving a problem correctly goes like this.

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Khan Academy similar to games like Temple Run have virtual badges that act as ‘milestones’. Some of the badges that are added to the profile of the user are shown below.

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There are also leaderboards which show the leaders with the maximum points. Other learning sites like Codecademy where people learn programming employ similar approaches.

Some businesses cleverly turn a major portion of their solution into games.

Foldit which was discussed in Crowdsourcing is a game designed to tackle the problem of protein folding to better understand their function. Users play the game and solve puzzles.

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Hopelab is a non-profit that designs games for people with cancer. Kids play that game that make fighting cancer inspiring and fun with results that indicate significant remission. The game involves a character whose mission is to destroy cancer cells which are shown as the evil guys in the game.

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SuperBetter helps to improve physical, mental, emotional and social lives by games, quests and challenges.

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Think of all the activities you are bored to do but is pretty important. Reading important non-fiction, reading business books, kids doing their homework, acquiring knowledge and skills important for your promotion, losing weight, watching important documentaries etc. We can expect some intervention of Gamification in a lot of these activities.

3. Social Challenges

“Therefore Encourage one another and build each other up…” – 1 Thessalonians 5:11, The Holy Bible

This approach can arguably be a sub-set of Gamification but sometimes this approach can be a major component used by some businesses. In the ‘Social Challenges’ approach, like minded (usually) individuals often challenge each other and use these challenges to motivate each other to accomplish goals.

This approach is currently underexploited. But you may have seen its promise in the Ice Bucket Challenge.

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From kids to your friends to Government Officials to Bill Gates to Elon Musk took part in the challenge, dunked buckets of ice water on their heads to raise awareness about ALS.

Some numbers that were released about the challenge:
a. 17 million videos were made related to the challenge
b. 10 Billion views on these videos
c. 440 million unique views
d. $111 million raised from the campaign
e. 28 million Facebook users in conversation about the campaign.

Weilos, a startup which was acquired by Weight Watchers was an online community for people interested in Fitness and Weightloss. Members track their food intake and activity, talk about weight loss and fitness goals and yes, share selfies of their progress. Founder Ray Wu, an MD from Cornell Medical School told Techcrunch that his research indicated that the average person who posted progress photos lost 1.2 lbs per week compared to 0.27 lbs per week for people who use Weight Watchers.

There is one caveat though. An organization like the ALS Foundation got huge publicity because of involvement of celebrities. Can other new businesses which help people challenge each other become this big without the involvement of Celebrities? That is a question that remains to be answered. But I am hopeful that businesses will build on this approach to tackle problems related to education, weight loss, skill development, philanthropy, healthcare etc. Basically where people have motivation as a ‘barrier’ to get important things done.

We will see the other 3 solution approaches of new businesses in the next post.

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