Case study: Using project management for effective crowdsourcing


[This post first appeared on the Getting Results From Crowds book website]

One of the most important implications of organizations shifting to crowdsourcing and crowd work is the need for effective project management structures. We cover Project Management in Chapter 14 of Getting Results From Crowds.

The chapter opens with an excellent case study of how Nick McMenemy uses crowd platforms to drive his startup Virdium. I gained plenty of insights and new ideas in my interview of him, which I condensed into the case study, reproduced below. I’m sure you’ll find useful ideas in there.

Case study: How Nick McMenemy runs virtual teams

Nick McMenemy is a serial entrepreneur who is now working on his third company, Virdium, which provides a cloud-hosted virtual desktop service. He relies heavily on crowds in building the company, and uses tight project management processes to manage them.

“It is a most wickedly efficient way of working,” says McMenemy. “I’m lean. By using this virtual team I can be like a multi-national 24/7.” The initial business plan for Virdium had a cost of $250,000 for the first phase. It ended up costing $35,000 and being completed in half the time expected.

“The key thing is a very tight brief,” notes McMenemy. “You provide a very granular approach to doing the task.” He test the brief himself to check it is clear, and provides clear examples of what he is looking for as well as the process.

He sets benchmarks on successfully achieving work by time spent and failure rate, and specifies reporting formats and frequencies. This allows spot checks that work has been done correctly.

McMenemy has developed an Excel spreadsheet with pivot tables to summarize all information on work that is being performed. Increasingly he is automating the process by enabling online submission of work performed and reporting.

McMenemy wants IP ownership to be crystal clear. He had a lawyer draft a 2 paragraph clause saying any work done is ‘work for hire’, saying what he paid for thatis “the best money I’ve ever spent.” This must be printed out, signed, scanned, and sent before any work is performed. Payments must go to the same company that approves the agreement.

The first milestone is to accept the terms of service. A 50% payment is made as soon as any work is done. He then provides very detailed feedback, which can be 30-40 bullet points in clear English.

“Crowdsourcing means you can do a lot more for a lot less,” says McMenemy. Effective project management of crowd workers is enabling his new startup to get out of the gates faster.