Turning Lead into Gold or $1 Paid into $10 Earned

Turning lead into gold had been the dream of alchemists for over 2,500 years. Today’s science makes it possible to transmute lead to gold, but at a cost greater than the resulting gold itself. How about paying $1/hour for work, yet the worker actually makes $10/hour. Can wages be transmuted?

The technologies behind today’s evolving crowdsourcing tools do enable the effective rates to be transmuted. How? Well, a simple example is the best means of explaining.

The editor of a popular small business blog recently tapped into the “Build My List” feature of this blog to get a full summary of Small Business Accounting Vendors. The list is intended to be a useful reference for small business people to ease their search for accounting related tools.

Getting a long list of accounting software companies and their websites was quite simple. Getting all the data to classify each in a side by side manner, however, was very time consuming. We compared the traditional means and costs of filling out this information matrix with the costs incurred through having it done via Smartsourcing (crowdsourcing).

Here’s how it went :

The In-house Intern: We gave the spreadsheet to our magnificent intern being paid $10/hour. We explained the goal of going to each vendor’s website to find a 10 word description of their accounting product, along with determining which of the 6 product categories they offered and an average price (so, 8 separate pieces of information). All the information was to be filled into the spreadsheet containing the vendor list.

The “Internet Intern”: Separately, we divided the 8 needed pieces of information into 4 task pairs (2 information pieces per task) and submitted very targeted questions via Smartsourcing to the on-demand workers (eg. “Does the accounting product at this weblink provide GL or AR/AP functionality – yes/no?). I offered $0.03 per information pair answer. So each completed company’s information set should cost me 12 cents.

Comparing the two:

	In-Office Intern		“Internet Intern” (crowdsourcing)
150	Companies (8 data pts.)	600	Tasks (4 per company)
12	hours to complete proj.	10	seconds to complete 1 task
		$0.03	pay rate per task
$10.00	pay rate per hour	$10.80	actual per hour earnings
$120.00	Total Cost	$18.00	Total Cost

By comparing the $18 cost to get the answer through Smartsourcing to the $120 via the conventional intern method, you can see that to me the payer, this is like paying $1.50/hr for work that normally would take 12 person hours to produce.

• $10.80 actual crowdsourced worker pay rate per hour earned
• $1.50 my payer “intern-equivalent” rate per hour

So, my Internet Intern cost me about $1.50 per hour in “conventional intern equivalent dollars”, but got paid $10.80 per hour in actual dollars. Wage Transmutation. Nice.

-Brent

PS: Expect to see many of the clever technology and process tricks employed in paid crowdsourcing begin to find their way into traditional productivity software to improve the pay rates and productivity of internal employees.

Comments

[John Creason]

Brent,

Nice - Can I be your intern on the next list? But seriously, I can't tell if you actually paid twice for this work? Did you do it twice and use one to check the quality of the other? How do you know that for 3 cents that you are getting good results.

Thanks.

JC

[Brent Frei]

John,

Good question. Our internal intern performed the task on enough companies to give us a confident estimate of how long it would take to do the full list should she actually have to do it. (Bookmark that work for later use in quality testing the Smartsourced results accuracy.)

Our confidence in the quality of the crowdsourced answers comes from the parts of the process not specified in the post because they would have added extra complexity to understanding the basic point of the article - cost and earnings comparisons.

The statistics of the 4 tasks per company are a roll-up summary of the actual task process. Given the nature of the data being asked for, some parts were easier than other parts. "Does this company offer a GL module?" was dead simple and fast, whereas "Give an average price paid for the product" had varying degrees of difficulty in coming to an answer. So, in some of the task categories, we asked more than one worker to answer the same question and averaged the answers. The price paid per task ranged from $0.01 to $0.05 depending on the difficulty. Therefore, the overall average time to complete and cost per task are a rollup of what was actually varied task prices and more than 600 tasks.

We compared the early results with those of the intern to gauge quality, and then at the end inspected it all in the same fashion you might review an employee's work. Spot checks and eyeballing.

[Doug Sibley]

I don't get your math. If it takes 10 seconds per task * 600 tasks it should take 100 minutes. Why did the intern take 720 minutes? Forgive me but it seems like the tasks should take longer if random people are doing bits of them instead of one person (no learning or task adaptation can happen). If this is the case, your basically just paying people really little.