The “Managed Crowd” Sourcing Model – Another “Made in China” Idea That Works

Innovative sourcing platforms that workWhile most suppliers would like to mainly attract and deliver high-end, high-margin services, many have to take on low-end, high volume tasks. Among such tasks are testing, transcribing audio files or hand-written documents and even some low-end application development.Faced with such requests from large clients like Microsoft, suppliers are unlikely to reject the business, but at the same time are not keen on performing high volume, low margin outsourcing projects in-house.So, what do they do? Some would perform such tasks in-house, doing their best to keep important clients happy at the risk of not meeting margin targets. Others will outsource these tasks to small or specialized suppliers, bearing additional governance costs of managing sub-contractors, again, just to keep their client happy.Interestingly, Chinese suppliers have discovered another solution – the “managed crowd”. Many of us are familiar with the concept of crowdsourcing where a task is outsourced to an undefined crowd. The crowdsourcing platforms, such as Freelancer, facilitate the space where buyers and undefined suppliers meet, offering the end-to-end lifecycle for a small-scale outsourcing project.I visited Pactera, the largest Chinese supplier, based in Beijing, to learn what Managed Crowd is.Pactera’s Managed Crowd platform, called Pactwork, brings together Pactera’s clients and suppliers. The work performed through Pactwork is of high volume and involves mainly linguistic skills, such as the transcribing of audio files into dozens of languages. So, instead of performing the work in-house or subcontracting to another supplier, Pactera manages a crowd of 30,000 suppliers that does this work for them.How does this work?Suppose a work-package of 1 hour of audio files arrives from a client. Pactera will create a new job on their crowdsourcing platform and invite suppliers to take part in the processing of the work. The invitation will be advertised in various social media sites as well as universities, to ensure good response from multiple sources. At this point the “management” of the crowd starts.People responding to the invitation will be invited to go through on-line training that will prepare them to perform the work at the highest quality possible. The on-line training will show the crowd the unique tags and symbols they need to use during the transcribing of the audio files and will challenge them through a set of multiple-choice questions to validate their knowledge. On average, there are 6 sections of training and each individual from the crowd can easily spend a few hours training themselves for the job.Once this stage has been completed, Pactera will invite that person to take a thorough exam. On average, 25% of those who express interest and take the training fail. They are entitled to try one more time before being rejected from the crowdsourcing platform. Those who pass will be reviewed by Pactera and only after a review of their abilities and score, will they get the approval to start performing work through Pactwork.The audio files are chopped into 8 minute episodes and each episode is allocated to a Managed Crowd supplier. Once the supplier has completed one assignment, another is assigned to him/her. To ensure quality before delivering to the client, Pactera performs quality assurance on the delivered work as well as through an automated QA process of some audio files that were included in the assignment specifically for the sake of quality assurance.Other suppliers in China have also introduced similar crowdsourcing platforms with a similar business model. iSoftstone runs a ToneLink managed crowdsourcing platform, where testing, SaaS, ERP and software development services are provided. Tonelink, based in Beijing with 1,000 employees and 3,000 suppliers registered, reported that B1.4RMB (about £160M) transacted through their managed crowdsourcing platform since its inception, only 18 months ago.Tonelink revenues from these transactions are M180RMB (about £20M). Tonelink’s main driver to pursue this crowdsourcing model is based on their ability to control and deliver quality from sub-contracted work and yet benefit from attractive margins while maintaining a slim governance structure. Pactera cited similar reasons for the pursuit of this sourcing model, though Pactera’s scope of work is limited and currently focused on the transcription of audio files with the intention to expand to other business processes.Tonelink is replicating their business model outside Beijing and has opened 6 other centres across China, that used the same crowdsourcing platform, attracting local business.Interestingly, a managed crowdsourcing model that is based on an e-platform is not common with suppliers based in the West. One might see this as a missed opportunity, considering that many large suppliers have developed advanced e-platforms, though they have not yet realized their potential.The Chinese did it again. [inlinead]

The “Managed Crowd” Sourcing Model – Another “Made in China” Idea That Works

To continue reading this story get free access

Finance & Accounting Events

Getting Ahead of Spain’s E-Invoicing Deadlines: Practical Steps for O2C and P2P Leaders

From Invoice to Pay: Orchestrating the Next Generation of Finance Automation

Beyond the Aging Report: A Practical Path to AI-Powered Receivables

What We’ve Learned from 50+ Agentic AI Implementations

Why Q2C AI Initiatives Fail and How Process Intelligence Fixes Them in a Day

From Shared Services to Intelligent Finance: How Agentic AI Will Transform the CFO Office

Follow Us

Latest Webinars

The Unstoppable Momentum of Deductions and Disputes: Using Agentic AI to Stem the Rising Tide

When AI Does the Work: Designing the New Human + AI Operating Model for Accounts Payable

From 5% to 74% Touchless: How Motion LP Transformed AP Through Automation and Process Improvement

Recommended

Combining AI and Human Insight to Strengthen Continuous Financial Recovery

The Red Thread of Compliance: Untangling the Complexity of Global Invoice Compli...

Unlocking the Intelligence Hidden in Accounts Payable

The Future of Order-to-Cash and E-Invoicing Market Report 2026

How Colgate Modernized AP Fraud Prevention with Trustmi

Why Is Intercompany Accounting So Hard to Fix–and What Actually Works?

The Agentic Advantage: Transforming Accounts Payable into a Strategic Value Engi...

A Practical Guide to AI for Finance Leaders: Unlock Intelligent Accounts Receiva...

The Financial Blindside: When Internal Reporting Tells Only Half the Story

Closing the AP Fraud Gap: Responding to AI-Enabled Risk

Germany’s E-Invoicing Deadline Is Approaching. Is Your Organization Ready?

From Friction to Flow: What Today’s B2B Buyers Really Want in Payments

FIND CONTENT BY TYPE

SSON COMMUNITY

ADVERTISE WITH US

JOIN THE SSON COMMUNITY

The “Managed Crowd” Sourcing Model – Another “Made in China” Idea That Works

To continue reading this story get free access

Finance & Accounting Events

Follow Us

Subscribe to our Free Newsletter

Latest Webinars

Recommended

FIND CONTENT BY TYPE

SSON COMMUNITY

ADVERTISE WITH US

JOIN THE SSON COMMUNITY