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The ethical use of crowdsourcing

Crowdsourcing has attracted increasing attention as a means to enlist online participants in organi-sational activities. In this paper, we examine crowdsourcing from the perspective of its ethical use in the support of open innovation taking a
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  ORIGINAL ARTICLE The ethical use of crowdsourcing Susan Standing  |  Craig Standing Centre for Innovative Practice, Edith CowanUniversity, Joondalup, Australia Correspondence Craig Standing, Centre for InnovativePractice, Edith Cowan University, 270Joondalup Drive, Joondalup, WesternAustralia, 6027, Australia.Email: Crowdsourcing has attracted increasing attention as a means to enlist online participants in organi-sational activities. In this paper, we examine crowdsourcing from the perspective of its ethical usein the support of open innovation taking a broader system view of its use. Crowdsourcing has thepotential to improve access to knowledge, skills, and creativity in a cost-effective manner butraises a number of ethical dilemmas. The paper discusses the ethical issues related to knowledgeexchange, economics, and relational aspects of crowdsourcing. A guiding framework drawn fromthe ethics literature is proposed to guide the ethical use of crowdsourcing. A major problem is thatcrowdsourcing is viewed in a piecemeal fashion and separate from other organisational processes.The trend for organisations to be more digitally collaborative is explored in relation to the need forgreater awareness of crowdsourcing implications. 1  |  INTRODUCTION The adoption of information technology innovations in organisations issometimes morally controversial (Kimmel, 2015; Peluso, 2015). Whilstcrowdsourcing has attracted increasing attention as a research topic,few academic researchers have investigated how different formsof crowdsourcing can be ethically used to support open innovation(Djelassi & Decoopman, 2013). Ethics has been defined as the  “ studyand philosophy of human conduct with an emphasis on the determina-tion of right and wrong ”  (Ferrell, Gresham, & Fraedrich, 1989). This def-inition incorporates moral philosophy and contextual judgement andprovides the view of ethics taken in this paper. In relation to businessrelated research, many different perspectives of ethics have been pro-posed and used (Craft, 2013). Ethics has multiple, context dependentmeanings and there are many competing models of business ethics inthe research literature.Crowdsourcing is a term used to describe the involvement of avirtual crowd in a task. Typically, the task is posted online as an opencall and members of the crowd self-select a task to be undertaken(Howe, 2006). Opportunities for organisations and individuals to obtainfinancial rewards, increase knowledge and develop skills can be gainedfrom involvement in crowdsourcing. The organisational use of crowd-sourcing can deliver business value, highlight current trends or predictpossible future directions for development (Schreier & Pr € ugl, 2008).Crowd members are motivated to participate in a task by theexpectation and fulfilment of intrinsic and extrinsic rewards, such asself-esteem and/or financial gain. The differences between organisa-tional and crowd member motivations requires consideration in orderto obtain satisfactory outcomes for both the organisation and crowdmembers (Barnes, Green, & Hoyos, 2015). Managerial decision makingregarding crowdsourcing options is further complicated by ethicaldilemmas arising from differences in national culture and stage of eco-nomic development (Donaldson & Dunfee, 1999). The internationalaspects of crowdsourcing raise issues related to labour rights andcorporate responsibility. The significance of the ethics of crowdsourcinghas not gone unnoticed by practitioners (Schmidt, 2013). Criticisms ofcrowdsourcing include the exploitation of cheap labour, sometimesreported to be as low as two or three U.S. dollars an hour (Bergvall-Kåreborn & Howcroft, 2014), and the abuse of intellectual property (IP)and ownership laws (Wolfson & Lease, 2011).Incorporating crowdsourcing into business models as an additionto in-house research and development (R&D) activities is becoming acommon practice. Examples of crowdsourcing in the literature high-light the potential of crowdsourcing for creating innovative products(Howe, 2008; Kozinets, Hemetsberger, & Schau, 2008; Marjanovic,Fry, & Chataway, 2012; Poetz & Schreier, 2012). This is often tied toidea generation and organisational attempts to discover new and cre-ative ways to allocate organisational resources. Crowdsourcing is notlimited to the ideation stage of product development but can beincorporated in different ways throughout the development process(Standing & Standing, 2014). The inclusion of external agents in ideageneration and product development delivers products or servicesthat can be seen as an outcome of collaborative and co-creationprocesses. The organisational value of a co-created product can bemuch greater than the compensation given to crowd contributors,but compensation equality is balanced against the organisational riskand resources committed to product development (Tokarchuk, Cuel,& Zamarian, 2012). However, the ease with which ideas can be used 72  |  V C  2017 John Wiley & Sons Ltd  Business Ethics: A Eur Rev  . 2018;27:72 – 80.Received: 18 December 2016 |  Revised: 9 September 2017 |  Accepted: 17 September 2017DOI: 10.1111/beer.12173  or misappropriated raises legal and ethical concerns associated withIP rights.This paper aims to investigate ethical issues in crowdsourcing andprovide a framework for its ethical adoption and use. The followingsection of the paper explains ethical perspectives applicable to crowd-sourcing. We examine crowdsourcing and related ethical issues from abroader systems perspective that includes economic, relational, andknowledge issues. A framework for ethical crowdsourcing use is thenpresented and we conclude with a discussion of the possible futuretrends of crowdsourcing. 2  |  ETHICAL PERSPECTIVES ANDFOUNDATIONS The study of ethics can be based upon different philosophical stand-points. The ethical approach adopted in this paper is based upon acombination of perspectives and these are introduced here. Velasquez(2002), for example, emphasises five different approaches to ethics.The Utilitarian Approach aims to produce the greatest good and theleast harm. The Rights Approach considers the respect of individualrights, and actions are wrong if individual rights are violated. The Jus-tice Approach is based upon treating all people the same way so thereis no favouritism or discrimination. The Common-Good Approach bindscommunity members by common goals and values. Finally, the VirtueApproach focuses on the adoption of individual character traits such ascourage, compassion, or fairness.A number of review articles have focused on trying to determinethe key features of moral action and decision making (Rajeev, 2011;Velasquez, 2002). Early works emphasise four stages of ethical decisionmaking: recognising the moral issue, making a moral judgement, priori-tising moral concerns ahead of other concerns, and acting on moralconcerns (Jones, 1991; Rest, 1986). Velasquez ’ s model (2002) is basedon a synthesis of the literature and includes these four stages but alsoincludes a reflection and evaluation stage in an attempt at continuousimprovement. A model proposed by Svensson and Wood (2008) hassimilar features to the other models but emphasises societal expecta-tions and societal evaluations. Opinions and insights underpin ethicaldecision making (Mingers & Walsham, 2010) and protocols for discus-sion need to be developed and incorporated into the models.The ethical dimensions of crowdsourcing can be viewed fromorganisational, participant, community, and society perspectives (Gan,Kosonen, & Blomqvist, 2012). There are many ethical issues for anorganisation to consider in the adoption process. Many ethical issuesarise in crowdsourcing work because rewards and conditions can beuncertain (Bergvall-Kåreborn & Howcroft, 2014). Typically, the contrib-utor in crowdsourcing has to expend resources such as time, effort,knowledge, and skill to answer the call. Crowdsourcing limits contribu-tors ’  access to organisational information and control is restricted totask decisions; there are potentially large numbers of service providers(Saxton, Oh, & Kishore, 2013) but financial rewards for contributorsmay be minimal or non-existent (Brabham, 2008). There is no require-ment for a relationship between an organisation and crowd membersoutside the sourcing space. Crowd contributors do have the ability towithdraw from the relationship at any time, but the organisation canchoose which ideas to reject and where to invest its resources. Thecrowd contributor does not have a high degree of control over projectscope or future outcomes when the reward is task dependent. Extrinsicmotivations for participation such as the prize, reward, or recognitionoffered may be sufficient to motivate crowd members to contribute toa task, but may represent inadequate compensation for task commit-ment and the expenditure of time and effort invested in participation(Djelassi & Decoopman, 2013).A participant should not devalue their profession ’ s skills andknowledge by working for nothing or less than professional pay rates.In other words, they should consider the potential devaluing of theirprofession by undertaking any work at low rates. Participants shouldnot take advantage of any transparency in submissions to  “ borrow ” designs or ideas from other participants to recycle elsewhere. Thoseengaged in employment should not use or recycle ideas and designsfrom their primary employer to  “ resell ”  on crowdsourcing sites.Participants have an obligation to report any unethical organisationalpractices or unethical practices of other participants (Brawley & Pury,2016). They can, for example, post their concerns on bulletin boardsfor crowdsourcing participants and/or inform the platform provider.Turker Nation, a discussion forum for MTurk workers, does this by hav-ing a Hall of Fame/Shame discussion thread (Turkernation, 2017). It isworth noting, however, that different cultures have different attitudesto IP and what is ethical (Yang, 2005).Online communities, often professional in nature, have a role toplay in protecting their members by not supporting lowly paid work orencouraging members to participate when the ethical issues areunclear. A community can take on the role of moderating and educat-ing participants in ethical crowdsourcing practices (Martin, Hanrahan,O ’ Neill, & Gupta, 2014). Society, too, is a stakeholder in crowdsourcingpractices. Government agencies, media channels, and professional soci-eties can raise awareness of unethical crowdsourcing practices in rela-tion to fair wages and conditions, particularly across internationalborders. 3  |  ETHICS AND CROWDSOURCING FOR OPEN INNOVATION The term  “ open innovation ”  describes innovation from three differentprocess perspectives (Enkel, Gassmann, & Chesbrough, 2009). An inter-nally focused process refers to earning profits by bringing ideas to mar-ket, and transferring ideas to the outside environment; an externallyfocused process integrates suppliers, customers, and external knowl-edge sources to enrich the organisation ’ s knowledge base; and acoupled process refers to co-creation through alliances, cooperation,and joint ventures where some project flexibility and negotiation is cru-cial for the success of the project (Enkel et al., 2009).In this next section, we use the literature and case studies toexamine crowdsourcing and consider the ethical challenges. We classifythese issues in terms of their economic, relational, and knowledgeimplications (Table 1). STANDING  AND  STANDING  |  73  3.1  |  Crowdsourcing and knowledge Crowdsourcing applications provide a means of harnessing the intelli-gence of the crowd, obtaining new ideas, accessing and creatingknowledge to solve problems, and accessing expertise to evaluateproposals and products (Saxton et al., 2013). Knowledge can be cre-ated more dynamically through crowd collaboration and can form thebasis of an open innovation process. Accessing crowds requires anunderstanding of crowd members ’  knowledge and skills and theirmotivations.Crowd voting is often used as an evaluation mechanism for crowdgenerated ideas. Voting mechanisms can establish a perception of ega-litarianism and democracy (L  evy, 1997) and outcomes can be used to justify management decision making (Brabham, 2012). However, crowdvoting can be subject to manipulation and the most highly rated ideasmay not be a true representation of crowd opinion (Bojin, Shaw, &Toner, 2011). It is ethically important for firms to communicate theground rules and guidelines for evaluation and avoid manipulating orcensoring the process for their own ends. The crowd can be involved TABLE 1  Key ethics issues in crowdsourcing Crowdsourcing domain Firm motivation/justification Ethical issue Recommendation Knowledge Obtaining new ideas, accessingknowledge to solve problems, andaccessing expertise to evaluateproposals and products.Crowd processes and voting can besubject to manipulation and themost highly rated ideas may not bea true representation of crowdopinion.Firms should communicate the groundrules and guidelines for evaluationand avoid manipulating or censoringthe process for their own ends.Firms may justify their use of crowd-sourcing by arguing that consumerswill benefit because there will be “ better ”  products.If participants ’  knowledge and exper-tise are not recognised and/orrewarded commensurate with theirvalue it can be viewed as exploita-tion. “ Better products ”  is a weak justifica-tion and does not excuse inade-quate valuation of contribution.Proper recognition of the value ofideas needs to be given.Firms may need highly skilled profes-sionals and in-depth knowledge.Crowdsourcing can undermine pro-fessional status since members of acrowd may lack identity and feeltheir self-worth is under threatwhen not properly recognised.Reward and recognise level of knowl-edge and skills obtained.Creativity can occur through crowd-sourcing by bringing together indi-viduals and melding alternativeperspectives in a collaborative task.Knowledge from many domains can beapplied in reaching a solution. Iden-tifying and rewarding individualcontributions and ascertainingownership of ideas can be over-looked.Firms can consider team rewards orinvolving the team in allocation ofrewards. Firm should determineprocess upfront.Although the creativity generated bythe challenge to the crowd mayproduce novel or innovative ideas,these do not always translate intoan innovation.Many ideas and solutions from thecrowd may go unrewarded.Consider how ideas that are notselected are to be managed, parti-cularly those that have reached ashort-listing stage because crowdmembers may have expended con-siderable effort on solutions.Economic Minimises financial risk. If a firm does not like an idea there isno pressure to use it — it minimisesrisk of financial loss associated withinvesting in an unused idea.Transparent process and decisionmaking.Saving money by crowdsourcing. Firms may not pay the going rate forlabour/skills.Pay appropriate rates for skills/knowledge/labour.Acquiring new IP. Participants should be unaware of IPoptions and be taken advantage of.Firms should help participants beaware of IP options.Low cost to access crowd and lowassociated risk.Internal employees may feel devaluedif by-passed by the crowdsourcingprocess.Internal employees should be can-vassed for their ideas and insightsand not be by-passed.Relational Co-creation process. A power imbalance exists. The co-creation concept can provide alegitimation for  “ borrowing ideas ” without due reward and withoutproperly questioning unethicalpractice.Crowdsourcing should not be used toexploit participants. Firms need totake an ethical stance at the outset.Transparent objectives. Unclear objectives may mislead peopleinto participating.Transparency in a firm ’ s motivations isimportant so that potential partici-pants can make an informed deci-sion about their involvement.Firms may draw on specialist commu-nities too often and may see themsimply as a service.Firms need to avoid over-using com-munities with constant requests andneed to be cognisant of a commu-nity ’ s norms, standards, and beha-viours.Firms should be aware of the stan-dards of acceptable behaviour andthe moral code of communities. 74  |  STANDING  AND  STANDING  in various evaluation mechanisms providing opinions and comments ona task and other participants ’  ideas. For example, the crowd can votefor an idea in a competition, contribute finance for a project,  “ like ”  or “ Digg ”  a news item. It is an effective means of gauging communities ’ interest and the opinion of the crowd. The voting space has to be care-fully set up to avoid possibilities of manipulation or interference. Thepurpose of the site has to be clear and transparent and supported bycrowd members and owners. The popular Digg social media site wasfounded on the promise of an open forum where crowd memberscould share news and opinions and vote using  “ digs ”  on items posted.The posting of codes for high definition compact disc players that over-rode regional disc encoding led to confrontations between the siteowners, organisational stakeholders with interests in restricting discuse, and crowd members. The site owners removed posts concerningdisc codes in response to organisational requests and litigation con-cerns, but later succumbed to pressure from the crowd and agreed tostand by their commitment to provide an open site where opinionscould be freely expressed (Greenberg, 2007).Using crowdsourcing to access knowledge is open to exploitationand has the potential to devalue knowledge. If participants ’  knowledgeand expertise are not recognised and/or rewarded commensurate withtheir value it can be viewed as exploitation. At a macro level, crowd-sourcing can undermine professional status since members of a crowdmay lack identity and feel their self-worth is under threat when theyare not properly recognised. Firms may justify their use of crowdsourc-ing by arguing that consumers will benefit because there will be  “ bet-ter ”  products but this is a weak justification and does not excuseinadequate valuation of contribution.Involving the crowd in the innovation process requires members ofthe crowd to exhibit creativity in problem solving. Creativity from thecrowd can occur through crowdsourcing by bringing together individu-als from different social contexts and melding alternative perspectivesin a collaborative task. The larger the virtual crowd the more likely it isthat a problem will be interpreted in different ways and knowledgefrom many domains will be applied in reaching a solution. A challengewith this type of dynamic collaborative work is identifying and reward-ing individual contributions and ascertaining ownership of ideas.It is possible that diversity in solvers ’  domains produces unex-pected or unanticipated solutions to those envisaged by the seeker.Although the creativity generated by the challenge to the crowd mayproduce novel or innovative ideas, these do not always translate intoan innovation. Creative ideas from the crowd may be too difficult torealise because of manufacturing, technical, or marketing barriers(Schweitzer, Buchinger, Gassmann, & Obrist, 2012) and innovation isonly realised through a successful production and distribution process(Scott & Bruce, 1994). An organisation should consider how ideas thatare not selected are to be managed, particularly those that havereached a short-listing stage, because crowd members may haveexpended considerable effort on solutions.Muji, a Japanese organisation well known for internal design capa-bilities, leverage their existing online community to gather creativeproduct ideas. The crowd ranks the ideas and the highest ranking areprofessionally designed with a production batch costing; the productcan be pre-ordered but is only manufactured when the minimum orderquantity is reached. Many of the products developed from the crowd ’ sideas outsold in-house designed products in the same category(Nishikawa, Schreier, & Ogawa, 2013). 3.2  |  Economics of crowdsourcing There are financial implications related to crowdsourcing for organisa-tions and participants (Adda, Mariani, Besacier, & Gelas, 2013). Fororganisations, there are potential cost benefits in involving a crowd inorganisational tasks. Proctor and Gamble, for example, is believed tohave increased idea generation and to have reaped significant cost sav-ing benefits by using crowdsourcing techniques to solve research anddevelopment problems (, 2012). Additionally, byinvolving crowds in the product development process, the discovery ofproblems and advantages of existing goods or services can quickly bebrought to light, reducing reliance on customer surveys and morecostly marketing activities. If a firm does not like an idea, there is nopressure to use it, in other words it minimises risk of financial loss asso-ciated with investing in an unused idea. Internal employees should becanvassed for their ideas and insights and not be by-passed by thecrowdsourcing process.Remuneration for crowdsourcing tasks is variable, ranging from azero dollar to $1 million offered by Netflix for a movie recommenda-tion algorithm (Netflix, 2009). One professional used crowdsourcingwhen he was looking for full-time work and managed to sell more than100 designs and earn US$22,000 (Johnson, 2012). This is a smallamount of money for many hours of labour, creative skill, and knowl-edge. Portraying users as amateurs reduces the obligation to pay atmarket rates, as it creates the perception they are participating to havefun and the thrill of having their ideas chosen. In some cases, the tasksposted in some crowdsourcing systems often require only basic knowl-edge and skills and the financial reward is minimal (a few cents pertask).For seekers, there is a professional obligation to work for at leastthe minimum wage. As one MTurk seeker commented:The first goal should be to get people to stop acting intheir self interests on MTurk and think of us as a group.We need to stop people working for free or next tonothing to improve their stats because it only encour-ages requesters to never pay better.IP and copyright needs to be carefully considered, and contributorsshould be aware of their rights and responsibilities in regard to its asso-ciated recompense. The terms of crowdsourcing agreements usuallyassign IP rights to the party seeking the knowledge, but some IP can beprotected by Creative Commons licences ( thatattach specified levels of access to creative content. IP protectionsystems are established to prevent the opportunistic behaviour of firmcollaborators but they can constrain input as they are underpinned byorganisational attitudes that presuppose collaborators are self-servingand economically motivated. STANDING  AND  STANDING  |  75  3.3  |  Relational aspects of crowdsourcing Organisational relationships are evolving with crowdsourcing systems.Evidence shows the approach in some cases supports relationshipsthat are arms-length and transient yet in other cases closer co-creationrelationships might be developed with consumers and communities.Organisations can expand internal capabilities and keep at theforefront of an industry by co-creation strategies. In co-creation, man-agers consider the identification of future customer needs, a broaderdecision basis, increased efficiency in gathering and use of customerinformation, and increased customer retention as major advantagesof integrating customers in the production process (Bartl, F € uller,M € uhlbacher, & Ernst, 2012). Crowdsourcing provides a mechanism toincorporate virtual crowds into the production process. The notion ofco-creation implies a willing agreement of groups on a similarpower stance to produce products and services. However, the term co-creation can be viewed as a misnomer since there is clearly a powerimbalance at play. The co-creation concept can provide a legitimationfor  “ borrowing ideas ”  without due reward and without properly ques-tioning unethical practice.Transparency in a firm ’ s motivations is important so that potentialparticipants can make an informed decision about their involvement.The firm should also be clear about whom it is targeting and communi-cate this also so that professionals are clear when the aim is to engagewith nonexperts. If the aim is to generate awareness or a sense of con-sumer belonging, then the participant may well feel there is little atstake, but if the firm aims to develop new products or services basedupon ideas generated by the crowd, then potential participants mayconsider whether the firm ’ s rewards are commensurate with the poten-tial of the idea.Firms need to avoid over-using communities with constantrequests and need to be cognisant of a community ’ s norms, standards,and behaviours. Social norms and behaviours are built in a communityby its ability to endorse or reject the contributions of others, whichenables the group to set standards of acceptable behaviour anddevelop a moral code (Benkler & Nissenbaum, 2006). Community sup-port and acceptance empowers members of the community and leadsto better quality ideas (F € uller, Hutter, & Faullant, 2011). Communitytools have been developed such as Turkopticon that inform workersabout requester behaviour and reliability (Hyman, 2013). The softwareworks with Mechanical Turk to provide reviews of employers and is away to put pressure on requesters to do the right thing for theirworkers.Online communities with a special interest or focus represent a vir-tual crowd from which not only to source ideas but also to build strongbrand loyalty and customer relationships. Communities develop aroundproprietary brands where creativity and ideas are commonly sharedamong members. For example, Playmobil and Lego both have manyenthusiastic customers who adapt and customise manufactured prod-ucts, develop new play concepts and share their creations and ideasonline. Findings suggest that organisational interaction with the onlineLego communities built a strong sense of community affiliation withLego, whereas online Playmobil communities willing to share their ideasfeel disregarded by Geobra (Janzik & Raasch, 2011). Members of theuser community who contribute to the design or customisation of aproduct are willing to pay a premium for the product (Franke, Schreier,& Kaiser, 2010) which increases the likelihood of a successful productlaunch.Individual motivation in the workplace has a stronger relationshipwith innovation than personality traits (Hammond, Neff, Farr, Schwall,& Zhao, 2011) and highlights the importance of motivation mechanismsin the crowdsourcing space (Tokarchuk et al., 2012). Participation inany crowd activity requires the individual to determine suitability for atask. Prizes and rewards are often used to motivate an individual crowdmember ’ s involvement in a task. How members of the crowd react tothese incentives is determined by their circumstances but involvingcrowd members in product development can influence brand loyaltyand the community ’ s perception of organisational customer orientation.It is the potential of crowd perceptions to impact on an organisation ’ sbrand that makes it necessary to carefully manage crowd interactionsand ensure crowd members experience positive and reaffirming inter-actions. Negative experiences can quickly spread through the virtualcommunity and require damage control to prevent further harm.Likewise, positive perceptions can build good relationships in the virtualcommunity that can translate into brand or organisational loyalty. 4  |  DISCUSSION In this paper, we have explained that although there are positiveaspects of crowdsourcing, there are also ethical issues that need to beconsidered. In this section, we present a framework for guiding organi-sations, participants, and communities in their ethical adoption and useof crowdsourcing (Figure 1). The framework is informed by a variety ofethical frameworks discussed in Section 2 (Jones, 1991; Mingers &Walsham, 2010; Svensson & Wood, 2008; Velasquez, 2002). Here, wehave used the commonly recurring components and features of thesemodels and supplemented them with a number of questions to guidethe practitioner. The questions apply equally to organisations, partici-pants, and communications except where highlighted. The five compo-nents of the framework as discussed earlier are: ethical issueawareness, obtain different perspectives, consider alternative actions,make a decision and monitor, reflect, and make changes. These are sup-ported by a communicative approach through the questions as asense-making process, as a fit with the context of crowdsourcing isimportant (Mingers & Walsham, 2010).This first stage in deciding to consider crowdsourcing needs toinclude raising awareness of ethical issues. These issues can beexplored by asking questions such as: Could the adoption of crowd-sourcing impact negatively on anyone? For example, could participantsbe misled into thinking the rewards are greater than they are, or willemployees feel by-passed by the process? Are there any implicationsof crowdsourcing beyond what is legal or efficient? For example, arecontributions from specialist communities being relied upon withoutadequate remuneration? Such questions are also valid for individuals asthey may think their actions do not impact on others. 76  |  STANDING  AND  STANDING
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