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The Pros and Cons of Crowdsourcing

by: Sarah Joson

Wednesday, November 21, 2012 | Outsourcing News |

Crowdsourcing Services

Crowdsourcing is the combination of the word “crowd” and “outsourcing”. It basically means that processes can be outsourced to a crowd of freelancers. Organizations that still have their internal managers and employees often make use of crowdsourcing to address talent shortages.

For instance, a client goes to the provider with a specific job order, the provider then asks several freelancers to send a sample, or work on the task. Ultimately, the client will select his/her preferred freelancer.

Brad James deconstructs crowdsourcing in his article posted at Business2Community.com. His article highlights the cost benefits of crowdsourcing, and identifies its pros and cons. 

When it comes to cost, he said businesses that are trying to avoid huge overhead costs are often caused by hiring external providers or employing an additional internal team. With crowdsourcing, you only pay for what you’ve utilized, which is typical in freelance-based operations.

Crowdsourcing providers earn by charging a services fee or taking some sort of commission from the freelancer’s reward.

Advantages:

- Portfolios do not mean much as long as you can deliver what clients want and when they want it.
- It is more cost-effective for clients.
- There is an endless supply of new ideas.
- It enables businesses to tap international talent.

Disadvantages:

- Freelancers usually get paid at a lower rate.
- It will be hard to track each person’s work and retain top level talent.
- Freelancers who are involved in crowdsourcing are usually beginners and are ready for mass production.
- Traditional providers are overtaken by crowd-based providers because they charge more.

All in all, businesses can use crowdsourcing to the benefit of their financial situations whereas beginners and those who are looking to make extra money can partake when crowdsourcing agencies call for orders.

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