At its peak in 1996, Kodak—then the world’s largest camera maker and photo film supplier—had revenues in excess of $16 billion and employed more than 145,000 people. But after 130 years in business, the photography giant could no longer keep up with the digital world it helped create and filed for bankruptcy early last year.
Executive SummaryCrowdsourcing—the process of transferring work from employees to a vast, undefined network of people on an open basis—looks set to launch a new era of unprecedented productivity growth. But companies that seek to take advantage of this new model face serious challenges, says CFC Underwriting's Graeme Newman.
At the very same time, a new force was emerging in photography. At Internet startup Instagram, an online photo-sharing and social networking service, business was booming. In just over a year, the number of registered users on the website went from one million to more than 30 million. The company, employing just 13 people, was acquired by Facebook for more than $1 billion last September.
How could a tiny online enterprise like Instagram thrive when an established company—one which once held two-thirds of the global market share in its industry—could not? The answer is crowdsourcing.