On 21 September 2009 Netflix announced the winners of a contest to develop a better algorithm for recommendations on the films it distributes. The winners share one million dollars. As Good Morning Silicon Valley (GMSV) put it:
For a relative pittance, the movie rental company got thousands of experts around the world to bust their butts on its challenge before a coalition of leading teams calling itself BellKor’s Pragmatic Chaos edged another collaboration called The Ensemble in a furious finish that literally came down to the final minutes of the three-year contest and had to be settled by a tiebreaker rule.
And who were these puissant winners? A virtual team. Again from GMSV:
The seven-member, multinational winning team was pleased to be given the chore of divvying up a million bucks and also for the chance to finally meet each other in person at the award ceremony.
Once again the world has been shown that virtual teams are not only possible but that they can beat out “traditional” teams that work in the old fashioned way, face-to-face. But wait! The almost-first-place team was also virtual. They lost by a fraction of an eyelash, according to Netflix. What are the implications of this for your organization? In this economy?
Although I haven’t checked with any of the virtual teams I suspect that the costs of office facilities were not high on their lists of expenses. Nor were the costs of commuting to the office for the team members. The primary operating costs for these teams were those of transporting their thoughts around the globe: Internet fees. So the brick and mortar infrastructure for this type of organization is nonexistent unless you count the portions of the team members homes that were used for the contest, among other uses.
Netflix paid out a megabuck for this contest. Isn’t that a huge sum? According to GMSV:
Netflix was pleased both by the results and the cost-effectiveness of the process. “You look at the cumulative hours and you’re getting Ph.D.’s for a dollar an hour,” said CEO Reed Hastings.
From the team members’ viewpoints the knowledge gained in the contest, even by the “losers” was well worth the effort. So we have yet another telework win-win-win-win situation: Netflix wins, the contest winners win, the contest losers win, and Netflix customers win as a result of more effective ways of rating films.
The winning doesn’t end there. Think about the fossils fuels not burned and CO2 not generated by the team members’ commuting (except for the winners trips to receive their prize after three years of effort). Think of the changes in international politics (all politics is local but what if “local” is global?).
Think of how you can apply these examples to your own organization. You may be able economically to employ skills that are not available locally. You may be able to slow or reverse your facilities expansion plans. It’s clear from the examples above that virtual teams can effectively organize themselves, so there’s another red herring about telework management that is exploded—again.
Try it. You’ll like it.