RUMA: Crowdsourcing it to the poor


Crowdsourcing is a type of participative activity by a group of people in response to a task given by an institution or an individual (Estellés-Arolas & Gonzalez-Ladron-de-Guerva, 2012). While crowdsourcing is often used in a context of generating innovative ideas (Adler & Chen, 2011; Majchrzak & Malhotra, 2013), there are other types of use of crowdsourcing. According to a book by Daren C. Brabham (2013), a problem-based typology of crowdsourcing approaches includes Knowldedge Discovery & Management, for example, where an institution or an individual mobilizes a crowd to find and assemble information. This type of approach has been used by an Indonesian social enterprise company called PT. Rekan Usaha Mikro Anda (RUMA), or translated to “Your Micro Business Partner”, to achieve its social agenda while making profit to the company itself.

Started as an idea for a business game competition, RUMA aims to empower the poor population of Indonesia and help them to create profitable business through micro-franchising while simultaneously generating profit for the company. To do so, RUMA uses information technology such as mobile phone which has been extremely high in its penetration even among the poor in Indonesia. The idea is of RUMA’s business model is that the company will sell pre-package business kit to Indonesian traditional shop owners (called Warung) which contains promotional banners & flyers, operating manual, basic phone, and SIM card. The Warung owners then can sell prepaid airtime using SMS and basic phone as their new business franchise (RUMA, n.d). Other than that, RUMA also trains these owners to use laptop and other devices so that they can accept payment for utilities and loan repayments (RUMA, n.d.).  The profit from the airtime sales will be used to repay the owner’s loan and as a margin for the company. In the taxonomy of crowdsourcing model (Saxton, Oh, & Kishore, 2013), this type of model where lenders and borrowers can be connected bypassing traditional bank is called Peer to Peer Social Financing Model.

RUMA Business Model (source: RUMA corporate website)
RUMA Business Model (source: RUMA corporate website)

As the Warung owners are constantly sending data to the company, the information gathered by the company such as locations, financial status, buying pattern, etc., becomes something valuable for consumer goods companies especially because these Warungs are commonly located somewhere in rural areas or even remote areas where there are not much convenience store available. In fact, RUMA is now selling this information to the consumer goods companies, such as Danone, which use the information for their marketing and supply chain purposes. Information regarding demand and target consumer which was usually supplied by the convenience store or the market research companies can now be supplied by these Warung owners who are much closer to the consumers.

However there is also a drawback to this type of model. Bearing in mind that RUMA a social enterprise therefore its “crowd” must be of among the poorest people in Indonesia with low education background and mostly live in the remote area, hence managerial control systems becomes critical for this type of business model.

References

Adler, P., & Chen, C. (2011). Combining Creativity and Control: Understanding Individual Motivation in Large-Scale Collaborative Creativity. Accounting, Organizations, and Society, 36, 63-85.

Brabham, Daren C. (2013), Crowdsourcing, MIT Press.

Estellés-Arolas, E., & Gonzalez-Ladron-de-Guerva, F. (2012). Towards An Integrated Crowdsourcing Definition. Journal of Information Science, 38(2), 189-200.

Majchrzak, A., & Malhotra, A. (2013). Towards An Information Systems Perspective and Research Agenda on Crowdsourcing for Innovation. Journal of Strategic Information System, 22, 257-268.

Marguerite. (2011, November 25). Ruma – A business in a box in the mobile sector in Indonesia. Retrieved from Planete D’Entrepreneurs: http://www.planetedentrepreneurs.com/planete/?p=2470&lang=en

RUMA. (n.d.). About RUMA. Retrieved from RUMA Company Web Site: http://www.ruma.co.id/eng/about-ruma.html

Saxton, G. D., Oh, O., & Kishore, R. (2013). Rules of Crowdsourcing: Models, Issues, and Systems of Control. Information System Management, 30(1), 2-20.

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