How crowdsourcing is transforming the business world

By | July 15, 2015

The idea that the majority of people might work for themselves in the future, often from home, is rapidly gaining credence, driven by the crowdsourcing movement. According to research commissioned by the Freelancer’s Union last year, 53 million Americans work freelance, which is 34 percent of the workforce in the United States.

There are various potential benefits for employers, and for workers, from this arrangement. The rise of the freelancer is set to continue, and there’s no telling where it might end. One trend that has really been pushing the freelance economy forward more than any other is crowdsourcing.



What is crowdsourcing?

In simple terms, crowdsourcing is about engaging a group of people to provide a service or deliver some content, instead of hiring a team of internal employees or engaging a company with its own team of employees. The term was coined by a couple of editors at Wired in 2005, as they sought to describe the rising trend of businesses using the Internet to outsource work to individuals.

The act predates the term, but it’s only the ubiquitous nature of the Internet, coupled with the flexibility and complexity of the collaborative software platforms we have now, that has allowed crowdsourcing to take off in the last few years in such a big way. It’s something of an umbrella term that actually covers a lot of different types of activity. We’re going to take a look at how they relate to software or website development.



Crowdsourcing tasks – In the business world, crowdsourcing is about cutting out the middle man. Businesses can post jobs, sift candidate pitches, and hire the individual or group of individuals that they want to complete the task. It could be a large distinct project, like a complete new website. It could be broken into individual tasks, so you hire a writer for the copy, an artist for the graphics, a developer for the code. It could even be on the micro level where individual tasks are broken down into smaller components and assigned to different individuals.


Crowdvoting – This is all about collecting a large number of opinions and using them to shape a project or product. Many brands use social media to shape new designs, posting examples and asking people to vote on them and offer feedback. They’re leveraging crowdvoting very successfully. In software development crowdvoting can be accommodated into beta testing or focus testing.


Crowdfunding – The crowdfunding movement allows people to post project outlines and ask for money upfront to fund the development. Through platforms like Kickstarter and IndieGogo this has spawned a thriving maker movement of new inventors. It has also allowed creatives an alternative route to fund new projects, freeing them from traditional investment channels and the attendant conditions.



What are the pros of crowdsourcing?

There are a lot of potential benefits for employers. Here are some of the main ones, but this is by no means an exhaustive list:

  • Lower costs – you only pay for the work you get and there are no overheads in terms of office space, benefits, and equipment.
  • Scalability – you can hire as many or as few workers as you need, when you need them, for as long as you need them.
  • Expertise – you can find exactly the right expert for a specific task. By breaking tasks down and assigning them out to different individuals it’s possible to get expert skills that you would never find in a single internal candidate.
  • Transparency – most crowdsourcing platforms have built-in systems of feedback. The only way for freelancers to get more work is to do a good job. Reputation is vital and you can generally check ratings.


Crowdsourcing isn’t going to be a perfect fit for every situation, but more and more small and medium-sized businesses are seeing the advantages. As it matures, the fact it offers employers the chance to build tailor-made, temporary teams for individual projects and tasks could make it increasingly more desirable than hiring and maintaining large internal teams.

For more on the topic as it relates to testing, check out 5 reasons crowdsourcing is ideal for usability testing.

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About Simon Hill

Simon is an experienced freelance technology journalist covering mobile technology, software, and videogames for a wide variety of clients in print and online. He regularly contributes to Digital Trends, Tech Radar, and Android Authority, and he ghostwrites for CEOs in the technology space. After completing a Masters in Scottish History at Edinburgh University, he began his career as a games tester, progressing to lead tester, game designer, and finally producer, before leaving the industry to write full time. He is passionate about the potential for good software and hardware to improve our lives, and strongly believes that thorough testing is a vital prerequisite for greatness.