Cloud labor is quietly but surely changing the way businesses operate. From sorting Excel files and transcribing conference calls to coming up with 100-word product descriptions and identifying objects in a photograph, crowdsourcing is making completing tasks cheaper, faster, and more manageable.

Despite the effect cloud labor platforms are having on businesses and individuals across the world, it remains one of the less visible variants of crowdsourcing. In the near future, however, that may all change.

CLoUd Labor, An overview

Cloud labor is a catchall term, and the platforms that make use of the crowd are varied. They employ competition-based models, freelancer matchmaking models, and microtasking models. Each one appeals to a different customer and can be used for a different kind of job.

At its core, the cloud labor concept is fairly simple. We have defined it in the past as the ‘leveraging of a distributed virtual labor pool, available on-demand to fulfill a range of tasks from simple to complex.’ As the industry matures, cloud labor platforms are becoming more sophisticated in the way they operate, and new platforms are emerging to fill market niches. Their efforts are ensuring that more companies can take advantage of crowdsourced labor, though challenges still remain for the newcomers.

Over the last several years, two dominant models have emerged: the freelance matchmaking platforms, and crowdsourcing platforms that send microtasks to large pools of workers. Each model has its own advantages and disadvantages.

Freelance matchmaking platforms allow companies and workers to build meaningful relationships over a long-term period. Customers are able to communicate directly with a freelancer, and the workers improve as they become more accustomed to their employer and the responsibilities required of them.

Training and managing the workers requires significant overhead, however, and since the platforms usually act as matchmakers, they are reluctant to take responsibility for the workers’ performance. This makes freelance marketplaces better suited for small and medium-size businesses that can train a single freelance worker, than for large-scale enterprises, which would find it hard to manage a sizeable freelance workforce.

Crowdsourcing models, on the other hand, operate on the basis of defining the work first, rather than finding a capable worker. The platforms that utilize this model function on an on-demand basis, meaning customers pay exclusively for what they need. These platforms typically focus on specific kinds of work – translation, categorization, or content creation, for example – splitting up a large job into a number of microtasks. This assembly-line approach enables work to be completed quickly and cheaply. The convenience comes with a cost, however.

For one, customers do not get the benefit of building relationships with the workers, meaning each task has to be defined precisely every time a customer wants it done. A customer, however, may not know exactly what he or she is looking for in a successful outcome, which makes it more likely that the task will not be completed to his or her satisfaction. And while platforms that employ the crowdsourcing model tend to adjudicate the work process at least in some way, that arbitration comes for a price.

Filling the Niche

Today, platforms are attempting to bridge the gap between the two models of clowd labor, hoping to get the advantages of both and to minimize each other’s shortcomings.

One such platform is Samasource. Founded by Leila Chirayath Janah, Samasource is a non-profit organization that aims to relieve poverty through job creation, rather than aid. Samasource offers its customers an educated workforce – a “private crowd.” The workers complete tasks as a primary source of income, meaning each individual is highly invested in achieving the best possible result. To help the most needy, Samasource partners with a variety of organizations across the globe.

“We work with entrepreneurs and business that have some kind of centers – an internet cafe, or a division of a larger BPO [business process outsourcing] company that has facilities,” Lauren Schulte, marketing and communications director at Samasource, told Crowdsourcing.org. “We partner with these organizations, and they are responsible for recruiting, training, and paying these people.”

When a project comes in, Samasource account managers still break the work up to take advantage of the crowdsourcing model. The employees, however, are able to complete work that is not just limited to repetitive and easy-to-process microtasks. While Samasource encourages its workers to use the employment as a springboard to better jobs, the emphasis on training means that customers are able to tap into an increasingly sophisticated crowd.

Even though some companies may be initially drawn to Samasource for the social benefits, Schulte insists that working with large enterprises means there is little room for error. Samasource boasts a 98% accuracy rate on its projects, and part of that Schulte attributes to the sophistication of the account management team and the educated workers.

“The types of services we offer give us flexibility that goes above and beyond of what traditional BPOs can offer, because they usually have a more rigid workflow,” she said. “And obviously, we provide higher quality than working with an unmanaged crowd.”

Another platform that is looking to take advantage of both cloud labor models is Ziptask, co-founded by Shawn Livermore and Jeff Sherwood. Built around the concept of hyperspecialization, the platform’s creators realized that workers are becoming highly skilled and can complete relatively complex projects cheaply and efficiently. Ziptask gives its customers the convenience of dealing with a single platform for a variety of tasks, making the cloud labor process nearly frictionless.

“Ziptask makes outsourcing everyday tasks that bog you down and keep you from doing things that are truly value-additive very seamless,” said Stan Miroshnik, Ziptask CFO. “It’s a layer on top of other cloud labor platforms, designed to be very simple in execution. It can be done across multiple platforms: your desktop, your iPhone, or on the web.”

Part of what makes Ziptask valuable is its role as a mediator between the demands of the customers and the capabilities of the workforce.

“In many places, you have to go through a lengthy process every time to specify the job,” Miroshnik explained. “You have to pick and interview a contractor, set up milestones and a payment system, communicate with the contractor by phone, Skype, or email, check their work, and only then you see the product that is only somewhat close to what you were expecting. Ziptask effectively becomes a contractor by taking the responsibility for that work.”

Indeed, Ziptask’s workflow process is simple and intuitive. A customer simply has to upload a file and write a set of instructions. Ziptask takes over from there: an algorithm examines the type and size of the file, and determines how long the job will take and the cost. A team member checks the estimate and sends it to the customer to approve.

Once the estimate is approved, “the system automatically picks a freelancer that’s online at that time that’s highly qualified to perform the work and assigns him or her the job,” Miroshnik said. “It always goes to someone who is incredibly fast and specialized in that particular area.”

Ziptask offers its customers a variety of services, from data entry and Word formatting, to graphic design and software development. In order to ensure that the most specialized workers tackle the appropriate jobs, Ziptask uses a rating system that shows how skilled a freelancer is in particular areas. Naturally, freelancers get the jobs that they are most qualified for, making them even more knowledgeable over time.

Platforms like Samasource and Ziptask that make use of both the freelancer and crowdsourcing models have many advantages, but their future success is not yet certain. While the platforms enable customers to feel more secure about the tasks they outsource, the cost of adjudicating the work may be too high for those looking to get projects completed for the lowest amount of money. And though the workers improve over time, the inability for companies to build a long-term connection may still prove to be deal breaker for those looking to create a more meaningful relationship with a freelancer.

The new cloud labor platforms certainly have the ideas and tools available to overcome challenges they face and upend the existing cloud labor market. Whether they can actually do so remains to be seen. Amid many uncertainties in the young but maturing field, one thing seems clear: the future of employment is bound for drastic changes.

Disclosure: Ziptask is a client of Crowdsourcing.org / massolution.