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At a time when many of us—myself included—still walked to the library to check our email once a week, Jack Hughes saw what the Internet was truly bringing to the world: connectivity like never before.

He founded topcoder, a platform for computer programming and design contests, pioneering "crowdsourcing"—tapping a community of people for ideas or resources—all the way back in 2001. While most of the language surrounding crowdsourcing in the early years were full of hyperbole and surface-level platitudes (i.e. wisdom of the crowds), we would spend afternoons sipping a light beer, and talking tactics: why crowdsourcing works, why organizations needed it then and why they would need it even more in the coming years.

The dawn of the internet allowed us to reach people anytime, anywhere, and Jack saw this connectivity as an opportunity to get things done in new ways—not just menial tasks performed at a cheaper rate, but top-line, revenue-producing assets.

But what could crowdsourcing do that another, traditional methodology couldn't? Why would this approach be different better for companies looking to create new assets? For Jack, it boiled down to something simple and fundamental; crowdsourcing models effectively eliminated—or at the least severely mitigated—the traditional risks associated with innovation.

Innovation Requires Failure—And That's Hard to Do at Scale

Traditionally, very few organizations can take the required amount of swings needed to effectively execute on innovative ideas. The ability to attempt something new, fail, learn from the mistakes and take another swing at it to hone the strategy is something most organizations can't do at scale.

It's not because organizations don't want to create new value—it's because the risks surrounding new product development are traditionally extremely high. It takes too long, requires too many internal resources (employees) whom are already busy with other work and, ultimately, it's expensive to execute on innovation.

Failure is deemed too likely, and because of this, fewer attempts are made to try. This is a recipe for stagnation, mediocrity and a slow business death.

Crowdsourcing Decreases Risk by Increasing Attempts

Through crowdsourcing, enterprises can effectively take more swings at executing on innovation and they can do so throughout the product development lifecycle.

When you can bring a greater volume of new ideas further down the development lifecycle, all while increasing your pace through innovation stages—ideation, curation and validation, prototype, MVP, productization, user testing and feedback—you greatly lower your risk per execution attempt.

It's not about using crowdsourcing to save money—it's about getting more value out of your current innovation spend, because your number of execution attempts can increase dramatically. With more swings comes better predictability, and as you increase your chances of likely success, you effectively lower your risk. Less risk and more swings means greater business success.

The Applications of Crowdsourcing

Crowdsourcing solutions and platforms can help an enterprise at nearly any stage of innovation:

  • Create and curate top ideas from internal and external crowds
  • Validate the market for ideas through mechanisms such as crowdfunding
  • Sprint to prototyping
  • Execute on productization
  • User test the solution with internal and external crowds

As for the future of crowdsourcing, consider that about 3 billion humans worldwide are currently online, with another 4 billion expected to join the ranks of the newly connected by 2020. These people are (and will be) thirsting for new ways to monetize their skills.

The uses and efficacy of crowdsourcing will grow alongside this boom in online talent. The enterprises that learn how to scale and innovate using crowds as an execution partner today will outpace the competition tomorrow.

Interested in more crowdsourcing content? Look out for upcoming posts from our partners at Appirio.

Photo: Shutterstock

Clinton Bonner View all

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