Businesses must think very differently in a digitally enabled economy. Just as Vegemite was created from a waste product in brewing beer, value can be created from digital by-products in the digital economy.
Luis von Ahn at Carnegie Mellon brought to the world the squiggly graphic challenge that has been used to distinguish a real person from a computer program trying to access a website. A very useful security service where automated systems could inappropriately access services directed at real people. This service has become extremely popular with 100’s of millions of challenges being issued everyday.
Luis recognised an opportunity here to utilise the ‘wasted’ time of these people wanting access to a website by using the security challenge to interpret scans of old books. He did this by modifying the challenge so that two separate squiggly graphics are simultaneously presented to the user, one known to the security application and the other a graphic taken from a scanned book. The known graphic determined if the user was a computer or real person and when 10 real users consistently interpreted the other graphic their answer to the challenge was added to the text file of the scan book. This service is translating 100 million words per day or 2.5 million books per year. The cost of paying interpreters, even from a low cost economy, would exceed $1 million per day. Even if these low cost salaries were cut in half they cannot compete against a service that has no cost of labour at all.
Using the above example can you think of other potential digital economy by-products that could replace traditional services? Louis von Ahn has, he is developing www.duolingo.com to offer free foreign language lessons whilst translating the Web by presenting sentences from webpages to language students and then identifying the correct translation (wisdom of crowds) by selecting the translation with the largest number of similar answers for each sentence. The incorrect translations will vary much more than the correct translations. The aim of this project is to translate the bulk of the Web into every major language.
You may not be able to design a digital process to generate your desired service entirely from free digital waste but there may be ways to reduce the cost significantly by more effective collaboration with others doing similar things. In every industry, in every market around the world, big companies and small are paying large numbers of people to do very similar tasks. These tasks could be as simple as evaluating products or services, creating induction programmes, creating a wide range of training modules used in everyday business or more complex projects like planning to open an office in Beijing. If it was possible to find a large number of companies or people who were planning to do the same or very similar tasks and get them to share their rarely reused digital assets (digital waste) as well as their work, considerable productivity increases would result.