Crowdsourcing is essentially what it sounds like.  It’s the sourcing of tasks to a multitude of people through an open call.  Today, crowdsourcing usually takes place on the internet, where people are freely able to exchange ideas and services.  A business may use crowdsourcing when there is a problem to be solved, to help develop new technology, contribute a product (such as photographs or articles), or analyze large amounts of data.

Crowdsourcing is different from outsourcing because with crowdsourcing, the open call is made to the public.  Anyone can respond to an open call.  Usually those who are drawn to the open call at the very least have some interest in the subject of the open call and they just may be the best qualified people to perform the tasks it involves.

The benefits of crowdsourcing are many.  Since crowdsourcing is usually done via the internet, the cost to a business for executing the crowdsourcing is minimal.  Also, the number of people that can be reached through this medium is incredible and businesses are able to reach people from all over the globe.  If two heads are better than one, then crowdsourcing brings this common adage to a whole new level.

Another benefit to crowdsourcing is collaboration.  The potential for collaboration is great, considering the vast amount of people that can be brought together as a result of crowdsourcing.  The collaboration for new ideas is just one possibility.  Another possibility is that crowdsourcing can branch into crowdfunding.  Crowdfunding can occur for a number of reasons, including people collaborating by pooling their money for a cause, such as disaster relief, to support the research of a specific disease, or to support a non-profit organization.

In addition to being low cost and being able to access a tremendous amount of people, crowdsourcing can have very quick results.  In the business world, time is money.  Another perk is that the business can gain valuable insight into what customers think and want.  Because participants in crowdsourcing projects can remain anonymous, people tend to be more honest and forthcoming than if they were in a different situation, such as a focus group.  Crowdsourcing also allows a business access to a more diverse group; a group which may have different yet valuable skills and knowledge than its current workforce.

While the cost of advertising an open call for crowdsourcing is minimal, the cost for compensating the participants can be low as well.  Payment for participation can be based solely on results or payment may even be nonexistent.  Often people are willing to participate in crowdsourcing just to be able to have a place to voice their ideas, and it may be enough just to recognize people for successful solutions to problems.

Crowdsourcing can be a great tool for businesses.  If implemented properly, crowdsourcing can be extremely cost efficient and return very valuable results.