Problem / Value proposition: Local governments and municipalities around the world face allegations for being inefficient and having lost touch with their community citizens. Progressive government bodies have set up online portals where citizens can report problems such as potholes, leaking fire hydrants, and other non-emergency issues. Although such initiatives are a step in the right direction, they lack transparency and accountability. How do we ensure that reported issues are not simply filed away? How do we prioritize projects if municipalities are grappling with limited budgets? In the case of social goods, prioritizing by community demand or “pain”, instead of ROI, could be more appropriate. A crowd-sourcing platform, which would let citizens report problems and propose projects on a public forum, would ensure that governments remain in-touch with the citizens, and local taxes are used to serve the community where it matters most.
Value creation: All issues and proposed projects could be viewed by the general public. Citizens would be able to vote “for” or “against” each issue, and express their opinions. Government officials would follow the interest on various topics to decide which projects should be pursued first. If certain issues remain unaddressed for a long period of time, citizens would be able to demand answers. The current system allows for community discussions through town hall meetings in some parts of the world, but these are not very effective. Most people cannot make time for these meetings in their daily lives. The online portal would allow citizens to post and review issues at their convenience. A time limit could be applied to each posting, making the system manageable for government officials. People who are passionate about a cause would also be incentivized to garner support for their ideas in a time-bound fashion.
Value capture: The crowd-sourcing platform in this case would essentially evolve into a community-sourced local news platform. This would provide ideal conditions for generating revenues through online local advertising. As membership grows, additional features such as listings for garage-sales, personal services such as baby-sitting, and home sales and rentals could be added. The goal should be to make the portal a one-stop-shop for everything related to a community. Strong direct network-effects and low multi-homing tendencies should provide some sustainable competitive advantage. The platform itself could be marketed by the local municipalities, who should be willing to become partners-in-crime. Some initial capital expenditure could be sought from the local government, and in exchange the platform could offer revenue-sharing to the municipality. This would help lock-in the service-providers on the platform, and create barriers-to-entry.
Why the crowd will participate: We all complain about how local governments are useless – they do not hear us. Although communication channels with municipalities exist in some cases, they are inefficient and demand too much of a citizen’s time and effort. We tend to pass-off social issues as “someone else’s problem.” The proposed solution lowers the personal costs of participating in community activities. As the platform grows to become a one-stop-shop for the community, new community members would be naturally attracted to the platform. One could even imagine a scenario where the quality of online engagement through the platform would affect real estate prices in a neighborhood – a value proposition that could bring all stakeholders to the table for discussing and promoting community development.