How Much Should You Be Crowdsourcing Your Strategy?
Strategic planning has traditionally been the domain of a small group of executive leaders who get together in a strategy retreat to set the vision, priorities, and execution plans for an organization. However, the pressures of a faster and more volatile marketplace combined with decreasing levels of employee engagement have challenged this top-down approach. While the right strategy design and execution approach depends on an organization’s unique situation, let’s take a look at a more inclusive, open, and generative approach to crowdsourcing your strategy.
What is Crowdsourcing?
In general, crowdsourcing taps into the combined wisdom of crowds. It leverages collective intelligence by tapping into diverse perspectives. When used appropriately, it can lead to better, faster, and cheaper solutions when compared to relying solely on a small internal team.
Some examples:
- Francis Galton, an anthropologist, first demonstrated the “wisdom of crowds” in 1907 during a competition to guess the weight of an ox. While no one-person guessed the correct weight, he found that the median of the guesses from hundreds of people was within 0.8% of the correct answer.
- In 1968, the nuclear-powered attack submarine USS Scorpion was lost at sea. During the search, the navy was only able to place the wreck within a 20-mile range. Collective wisdom from a wide and varied group of experts pinpointed a location 220 yards from the wreck — 99% closer.
- In 2002, Gary Hamel helped to open up Nokia’s strategy process to a wide cross-section of employees to generate the new thinking and innovative ideas required to take on industry-leading Motorola. Hundreds of employees participated. In 2005, Nokia used the synthesis of those ideas to sell a billion phones in a single year.
- Today, crowdsourcing also impacts the new world of sports betting. As more people place bets, the odds become more accurate and the market becomes more efficient.
The Benefits of Crowdsourcing Strategy
Crowdsourcing strategy can be particularly effective when the senior team does not have the bandwidth, game changing ideas, willingness to change, or connection to internal and external realities to create the quality of strategies equal to the challenge of their objectives. Benefits include:
- Greater Insights, Innovation, and Customer-centricity
Gathering input from a diverse set of employees, customers, and external stakeholders exposes leaders to new ideas that may not emerge in executive meetings but are required to help organizations stay ahead of disruptive market trends and changing customer demands.
- Increased Employee Engagement and Buy-In
We know from organizational culture assessment data that when employees actively contribute to strategy, they feel a stronger sense of ownership, clarity, meaning, and commitment to execution.
- Faster Problem-Solving and Adaptation to Market Changes
While involving more people may see like it will take too much time and effort, crowdsourcing allows organizations to identify patterns and solutions to complex problems faster by tapping into collective intelligence.
The Risks of Over crowdsourcing
Not all situations, decisions, or strategic directions require collective wisdom. Risks include:
- Slower, Ambiguous, and Watered-down Decision Making
Too much input can lead to analysis paralysis, frustration, and dilution — especially amid conflicting opinions. Strategic clarity requires decisiveness — excessive crowdsourcing can blur strategic priorities and hinder strategy execution.
- Lack of Accountability or Confidentiality
If everyone contributes to strategy, who owns the outcome and how do you minimize leaks? Crowdsourcing, without clear leadership oversight and confidentiality guidelines can lead to a diffusion of responsibility and an increase in risk, where no one is accountable for results.
- Loss of Strategic Focus
Not all ideas align with business objectives. Crowdsourcing without strong guidelines can lead to an influx of suggestions that, while interesting, do not serve the company’s long-term goals. Leaders must strike a balance between openness and strategic alignment.
When to Crowdsource Strategy
If insular thinking is limiting your performance, here are three areas to incorporate more collective wisdom into your strategy process:
- Early-Stage Ideation to Increase Strategic Believability
Crowdsourcing can be valuable in the early stages of strategic planning and design. Engaging employees, customers, and partners can surface fresh perspectives and highlight emerging trends that might otherwise be overlooked.
- Testing and Validation to Increase Strategic Buy-in and Implementability
Before finalizing a strategy, companies can use crowdsourcing to assess concepts. Gathering feedback on potential initiatives can highlight risks, refine approaches, and ensure alignment with market needs.
- Operational Execution to Increase Autonomy and Engagement
While high-level strategy should remain in leadership’s hands, execution often benefits from crowdsourced problem-solving. Employees closest to the work can identify roadblocks and propose solutions that improve implementation.
When to Limit Crowdsourcing
While workplace transparency and openness seem like an antidote to common organizational challenges, crowdsourcing should be limited for:
- High-Stakes Decisions
Some big strategic choices — such as mergers, acquisitions, or major pivots — require confidentiality and a focused leadership vision. Crowdsourcing these decisions can create unnecessary organizational churn or leaks that jeopardize execution.
- Core Competitive Strategy
While external input is valuable, a company’s unique competitive advantage should be shaped by leadership and key stakeholders. Over crowdsourcing in this area risks diluting the organization’s differentiation.
- Crisis Situations
During crises, employees expect leaders to act quickly and decisively. Crowdsourcing in high-pressure situations can slow response times and create confusion when a unified direction and immediate action is needed.
The Bottom Line
Both traditional and crowdsourced strategy design have their place. While executive-led strategy ensures clarity and speed, a more open strategy taps into collective intelligence for increased innovation and engagement. High performing organizations find a balance by leveraging broad input where it adds value while maintaining strong leadership to drive execution.
To learn more about how to better execute strategies, download 3 Big Mistakes to Avoid When Cascading Your Corporate Strategy
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