Executive Summary

Crowd-based engagements are witnessing increasing adoption across functions such as marketing, consumer feedback, back office, and IT. Crowd-based providers are delivering services for tasks as varied as ideation, logo designing, data entry, and application testing.

An interesting point to note is that there are very few crowd service providers that target large enterprise buyers for application development. This is despite the fact that enterprise buyers of application services, specifically application development, are evaluating the suitability of this model for their complex requirements.

What is getting reflected is that crowd service providers do offer attractive options to buyers for ad-hoc, lower ticket value engagements; however, their focus on small buyers, lesser maturity of offerings, peculiar engagement model, and unique operating construct make them less attractive for enterprise-class buyers of outsourced application services. Therefore, from a typical large-scale sourcing perspective, crowd-based providers do not offer a credible alternative to application development outsourcing.

Despite crowd-based services not appearing as a true alternative to traditional application development outsourcing, they may pose specific challenges in the areas of staffing strategies and addressable market, among others.

This research analyzes crowd-based application development services as an alternative to traditional outsourcing. It focuses on scenarios where enterprise buyers may derive value out of crowd, challenges they may face, its impact on traditional outsourcing, and other aspects of crowd-based application development. Some of the topics covered are:

• Crowd-sourced application services as a competitor to traditional outsourcing
  • Suitability of models
  • Application characteristics and delivery models
• Crowd-sourced application providers – an alternative for buyers
  • Pricing
  • Buyer expectations
• Key challenges for traditional providers
  • Addressable market
  • Buyer expectations
  • Talent management
  • Crowd-based resources in outsourcing