Does Increasing Project Demand Advance or Damage TopCoders' Business Model?

Increased project demand within TopCoder can increase the number of participants in their community and in turn bring in higher levels of revenue, but it can also come with many challenges and a high level of uncertainty. Hughes, the CEO of TopCoder, was concerned if the community members and company staff could keep up with large growths in demand. While Hughes was concerned with these aspects, other executive members were not, and they believed that TopCoder as a company has unlimited potential in terms of growth. Mike Morris, the Vice President of Sales, believed that “If sales grow at a linear rate, membership grows at an exponential rate.” He believed that if the amount of projects increase within the company, then the amount of skilled community members will increase at the same rate. Hughes did not agree with Morris and other members in that throwing more money into the community would result in more qualified participants. Evidence in the company's past proved that if TopCoder held too many competitions in a given week, it would result in reduced quality because of inexperienced coders who now have an opportunity to win because of the lowered competition in a given project.

It was also proven in the company’s past that when the amount of competitions surpassed a certain amount then the review quality would suffer. Because of the increased amount of competitions, the normal reviewers would stop reviewing and would compete in projects, leaving TopCoder with unqualified reviewers. Also many of the current clients who work with TopCoder will be concerned if too many competitions are available because that means they do not have as much talent and participants competing for their work. TopCoder realized that having too many competitions could result in reduced consistency, which is a very important factor in addressing certain systems. Client service is also another concern when it comes to increasing the number of competitions available for community members. People working at TopCoder could not respond to clients and answer their questions as well as they could in the past because of increases in projects and competitions.

I agree with Hughes and other community members in that increasing the number of competitions past a certain point has a negative effect on the company and their clients. TopCoder's business model is not designed to hold an unlimited amount of competitions and there is a balance that executives need to keep a close eye on. Quality is the important aspect of software development and many of the company's past failures have been a result of not being able to maintain a high level of quality due to increases in the number of competitions and not being able to keep up with capacity.