Jeff Howe is a writer at Wired magazine and a Neimann Fellow at Harvard who coined the term "crowdsourcing" in 2006. In this video he explains the basic concept behind crowdsourcing and its impact on the way companies do business.

What is Crowdsourcing?

Wikipedia, which is itself a crowdsourced online encyclopaedia, says "crowdsourcing" as a combination of the words "crowd" and "outsourcing". It is defined as,

"the act of taking tasks traditionally performed by an employee or a contractor, and outsourcing them to a group of people or a community through an "open call" to a large group of people ("a crowd") and asking for contributions."

As Jeff Howe points out, crowds used to have to be physically together in order to create something. The internet and Web 2.0 technologies, however, now allow people from around the world to come together, form communities, and collaborate "simply out of shared interest, shared passion, for a hobby, a craft, an art."

Howe further suggests, "the person you think is the best qualified to perform a job, isn't always the best person to do it."

Crowdsourcing, therefore, allows you to tap into an international pool of talent filled with individuals who are willing to answer your call for programmers, graphic designers, photographers etc.

Why use Crowdsourcing?

As an article on BNET explains,

"With the rise of user-generated media such as blogs... Wikipedia, YouTube, the traditional distinction between producers and consumers is becoming blurry. It's no longer fanciful to think of the marketplace as having a collective intelligence... today's technology makes it possible to enlist ever-larger numbers of non-technical people to do ever-more complex and creative tasks, at significantly reduced costs."

An open call to this marketplace can give a small to medium-sized business access to more talent and creativity than may be locally be available. For example, if you need a graphic designer, crowdsourcing sites offer your company the opportunity to post your project to hundreds of designers around the world who are willing to work "on spec" (for free) to pitch their design to you in the hopes of winning your business at the agreed upon rate.

The best crowdsourced projects, like any projects, have clearly set objectives and a vision that can be understood by all in your talent pool. The downside, of course, is that these crowdsourced individuals are not employees, and therefore cannot be managed that way.  Crowdsourcing, in that regard, may not be an easy transition or even a good step for a traditional 'top-down" organization.

As a small business owner, however, I've decided to do my own experiment in "mass collaboration". My company, Integrated Website Solutions Inc., needs a new logo. So I plan to post this logo design project in the next few days on www.crowdspring.com, a well-known crowdsourcing site. The site offers a minumum of 25 to over 100 logo designs per project from "creatives" in more than 125 countries.

Once I pare down the choices to just three of the logos I like, I hope to poll my MIN community on which one they like the best. Stay tuned .... and "Happy 1st Anniversary, MIN! I look forward to meeting more of you in person at tonight's celebration!

Integrated Website Solutions Inc. offers complementary internet marketing consultations to industrial companies across Ontario that need a solid, ROI measurable, online strategy. Call us today at (519) 342-8551. For more internet marketing and social media tips, follow Sarah Sturtevant on Twitter!