What is Crowdsourcing?

The Pros and Cons of Crowdsourcing

The term Crowdsourcing was first coined by Jeff Howe from the terms “crowd” and “outsourcing” to distinguish between outsourcing (generally working with single or small team of vendors) and crowdsourcing (working and collaborating with a large group of people or community of professionals). Crowdsourcing is the practice of outsourcing your task, job or project to a large group of people. Unlike outsourcing which generally delegates the project or task to a single vendor or a few vendors, crowdsourcing is generally performed by a large team or community of professionals, vendors and freelancers allowing you to have a huge brain power as part of your project.

Crowdsourcing is used when companies or entrepreneurs need ideas and proposals from many different sources generally when companies need creativity, innovation or specialized professional skills. By using crowdsourcing you can gather ideas and suggestions from people around the world and at the same time it is a great brainstorming opportunity for generating new ideas. For example, when companies need new and fresh ideas and perspectives for new product development working with a large group of outside professionals can bring many new insights to the current issues and opportunities. Another common example is when entrepreneurs have good initial ideas for starting a new business but they still need more ideas and business or technical experience to develop a successful business model.

The challenges and opportunities brought to you by crowdsourcing are huge because it is an efficient collaboration method where you delegate or distribute the problem or opportunity to unknown and large group of professionals. The crowd is generally found in online communities or specialized internet forums and crowdsourcing communities. The crowdsourcer (the company that submits the job or project) generally owns the project and the crowd is generally rewarded with prizes, recognition or pay depending on the type of the project. Many professionals volunteer by working a few hours a week and they are rewarded for their contribution through recognition in their professional community – good marketing opportunity for professionals.

What are the advantages of crowdsourcing? The pros and benefits of crowdsourcing are the low cost, efficiency, large pool of professionals as part of your project team, large quantity of ideas for your project, high quantity and diversity of talented professionals and collaboration is online without travel cost and travel time required. Today, with all the online communication tools such as blogs, professional forums, online communities, Facebook, Twitter, LinkedIn… every small business or entrepreneur can take advantage of the crowdsourcing opportunities and benefit from crowdsourcing. Crowdsourcing is a very productive business method, tool or process that offers opportunities for better and faster innovation and new product development through professional and technical expertise that your business does not own or cannot afford in a traditional way of doing business. The future of crowdsourcing is big given the current trends in online collaboration and online communication media.

What are the disadvantages of crowdsourcing? The major crowdsourcing cons, risks and disadvantages come from the fact that the crowd which is part of your project is not part of your business – they are not your employees and you are not able to fully control the project as you are able to do with traditional jobs and projects. Another con of crowdsourcing is the trust and confidentiality issues when you work with a large team of people you don’t even now – this is a big risk and challenge for some projects.

While crowdsourcing has many advantages and disadvantages it can be very effective way of doing business for some of your projects. When you need help and more brainpower for your projects where you don’t need a full control and there are no potential confidentiality issues you might consider using crowdsourcing as your business tool.