Advantages and Disadvantages of Crowd sourcing

Oct. 9, 2009 - PRLog -- The term crowd sourcing is quite popular now a day. This principle crowd sourcing is not very hard to understand but if it is utilize successfully it can make a large profit to the business.
            The term crowd sourcing is originated from an article of Jeff Howe in 2006 in wired magazine. He described crowd sourcing as “the act of a company or institution taking a function once performed by employees and outsourcing it to an undefined (and generally large) network of people in the form of an open call.”
That means crowd sourcing is a procedure to use the power of crowd. So it is very powerful because always two heads are better than a single one and similarly the heads of a mass of people are better than a few.
            Previously a task, which was done the employees of a company or the company outsourced it, is now performed by a mass of people. In this process the no. of people doing the job increases but the cost required to perform the job decreases. A company always wants to obtain new innovative ideas for its business model using minimum cost. The phenomenon crowd sourcing allows the companies to utilize the power of the people at cheapest price.
             This phenomenon crowd sourcing is often used as a contest hosted by companies to award people who wins a challenge given by the company(http://www.philoptima.org/crowd-sourcing-expert/ ). In this process the final award winner will be a single person but a company can get many innovative ideas from it without any expense.
            The main advantage from it is the host has a large no. of options to choose from it. Suppose if a company wants to crowd source the solution of a scientific problem even though a single best solution will win the challenge but from the other entries the company may get one or more ideas to solve other problems.
            This method also has some disadvantages. The  main problem is that if the crowdsourcee participates in more than one contest and submits the same solution to all the contests and if more than one host choose his/her solution then the host who wants to use the solution later will not be able to use it because it was not unique. To overcome this problem the host company must use some fruitful methods to check the uniqueness of a solution provided by a competitor.
            There are also some more disadvantages, such as, the ideas of a crowd sourced challenge is open so there is a high chance of it to get leaked out. Again disputes will be there so one cannot replace it with the existing business model. Wrong marketing strategies can hamper the process. It can be done by passing bad mouth publicity. Suppose a company use crowd sourcing for its next project research. By any chance if the end result is proved not so effective rather of poor quality then who is to be blamed? People will make the company responsible for not taking its research work seriously and thus using this cost effective method for the company’s research will not work at the end.
             Though there are many such advantages and disadvantages but still in my opinion crowd sourcing is a great tool for any business. While searching internet I found an open innovation platform http://www.philoptima.org/ which uses crowd sourcing successfully.  So from well planed and well maintained crowd sourcing a company can gain a lot.