What is crowdsourcing? Jeff Howe coined the phrase in a June 2006 Wired magazine article: “Crowdsourcing is the process by which the power of the many can be leveraged to accomplish feats that were once the province of a specialized few.”

THE SHORT ANSWER

Howe later refined his definition on his blog, while he was researching his seminal 2008 book, Crowdsourcing, with the following:

The White Paper Version: “Crowdsourcing is the act of taking a job traditionally performed by a designated agent (usually an employee) and outsourcing it to an undefined, generally large group of people in the form of an open call.” (Howe, 2008)

The Sound bite Version: “The application of Open Source principles to fields outside of software.” (Howe, 2008)

Jeff Howe’s Video Version: which also features Calgary’s iStockphoto, another local pioneering company in crowdsourcing.

How Long Has Crowdsourcing Been Available?

The practice of tapping a crowd has long been used by business. For example, in 1916, Planters Peanuts held an open contest to develop its logo. What’s new about crowdsourcing today is how it uses web 2.0 technology to rapidly and affordably reach a global crowd, engage their interest, manage and filter their ideas and feedback, and help choose the optimal scenarios to act upon.

The most advanced crowdsourcing technology uses sophisticated algorithms based on deep knowledge of human behavior, and equips companies, organizations and governments with the ability to distill crowd input down to not just “what’s most popular” but what are really the most economically-viable and probable ideas to succeed. It’s not unusual for the contribution of a crowd to be worth millions to a company.

Chaordix: A Pioneer in the Crowd

The founding company of Chaordix opened its doors and began to innovate with crowdsourcing back in 2006 to identify highest-opportunity technology ventures for investment and development. By the time the company was ready to launch Chaordix’s commercial managed services platform for crowdsourcing in early 2009, Cambrian House had garnered 50,000+ community members, over 7,000+ ideas, and had been profiled by magazines, newspapers, television, radio, podcasts, blogs, conferences, universities and books as a crowdsourcing pioneer.

Out of that experience, came the Chaordix platform and the knowledge to direct enterprises on effectively finding and leveraging Crowd Intelligence.™

LINKS

If you’re new to crowdsourcing and want to immerse yourself in some of the ideas and trends that influenced this growing field, take at look at the Thinkers category of our blog for writers, speakers and bloggers we recommend.

Sound bites

Linux, MIT, Dell, IBM, Harvard, Sun, Wired, and Google are some of the many organizations that have been forecasting the future of crowdsourcing, discussing trends like open innovation, peer production, customer-driven innovation, interactive community building, and open source products. Here are some quotes worth noting:

“Peer production is about more than sitting down and having a nice conversation… It’s about harnessing a new mode of production to take innovation and wealth creation to new levels.”

– Eric Schmidt, Google CEO talks crowdsourcing in Don Tapscott’s Wikinomics, 2007

Google offered $10 million in awards for its open source cell-phone operating system.

“The amount of knowledge and talent dispersed among the human race has always outstripped our capacity to harness it. Crowdsourcing corrects that – but in doing so, it also unleashes the forces of creative destruction.”

– Wired magazine writer, Jeff Howe from his book Crowdsourcing, 2008

Jeff is one of the most insightful and prolific bloggers on crowdsourcing. Check out his blog.

“Thanks to the Web.. Companies that move now can leverage a global pool of talent, ideas, and innovations that vastly exceeds what they could ever hope to marshal internally.”

– USA Today’s technology editor Kevin Maney

“Idol was a vehicle to launch records.”

– Simon Cowell, Sony BMG

Sony tapped a crowd to reduce the risk of guessing at the next best selling artist. They claim first opportunity to sign contestants to a recording contract, and estimates are that they have sold around 100 million albums from American Idol winners.

“No matter who you are, most of the smartest people work for someone else.”

– Bill Joy, Cofounder Sun Microsystems

“…decision making has been decentralized… Kids who grew up with running water wouldn’t know how to run a hand-pump, and in this new world we’re entering, a lot of what’s familiar will go the way of the hand-pump.”

– Thomas Malone, MIT professor and author of The Future of Work

 

In his research and writing, Thomas W. Malone has predicted many of the major developments in electronic business over the last decade including “outsourcing” of non-core functions in a firm. He’s the Patrick J. McGovern Professor of Management at the MIT Sloan School of Management and the founding director of the MIT Center for Collective Intelligence. Check out his research.

“No one has a monopoly on knowledge the way that, say, IBM had in the 1960s in computing, or that Bell Labs had through the 1970s in communications. When useful knowledge exists in companies of all sizes and also in universities, non-profits and individual minds, it makes sense to orient your innovation efforts to accessing, building upon and integrating that external knowledge into useful products and services.”

– Henry Chesbrough, an assistant professor Harvard Business School and author ofOpen Innovation: The New Imperative for Creating and Profiting from Technology.

“We open [up the Blue Gene supercomputer], essentially to the world, for people to submit what they’d like to do with Blue Gene, and we pick the hardest problems.”

– Paul Koteas, Chief Engineer IBM

When a valuable breakthrough emerges, IBM supports its development… and is perfectly positioned to share in the profits.

“…the world is becoming too fast, too complex and too networked for any company to have all the answers inside.”

– Yochai Benkler. Yale University from The Wealth of Networks

“…innovation is driven by everyday end-users. …Today, more and more innovation comes from the myriad hobbyists and enthusiasts at the tech-savvy edges of the computing ecosystem.”

– Geoffrey Koch, senior manager with Intel Solution Services

Intel has been involved in open source successes including the GNU operating system, the Linux* kernel, the Eclipse* integrated development environment and the Apache Web Server* software.

“We listen, learn and then improve and innovate based on what our customers want. It’s one of the real advantages of being a direct company.”

– Dell Chairman and CEO Michael Dell at the launch of Dell’s IdeaStorm

Dell’s IdeaStorm community reaches out to millions of customers in more than 100 countries and asks them to share ideas and collaborate with one another to tell Dell what new products or services to develop. In two years, Dell has gathered more than 11,000 ideas

“P&G now incorporates into our innovation a much greater desire to collaborate with people outside Procter and Gamble…. We want to keep growing at the rate that we have historically been growing. When you get to be the size that we are, continuing to do that on an internal basis really makes no sense.”

– Mike Addison, Procter and Gamble, New Business Development

As part of their broad Connect + Develop initiative Procter and Gamble has launched an open innovation challenge teaming up NESTA

“NASA…has been implementing the Open Innovation approach to achieve NASA’s goals of going back to the moon, to Mars, and beyond. Forming partnerships in which both NASA and its collaborator have something valuable to contribute to address the other’s technology “need” allows both parties to use fewer resources to solve their respective problems. For NASA, this approach not only accelerates space mission research and development (R&D), but it also makes the R&D more cost-efficient, which is a benefit for taxpayers.”

– Nona Minnifield Cheeks, NASA Goddard Space Flight Center

NASA’s clickworkers program invites contributors to measure craters in 5 seconds.

“This is really the biggest paradigm shift in innovation since the Industrial Revolution”

– MIT professor Eric von Hippel, specialist in innovation management

“Participation is the new brand loyalty.”
– Yves Béhar, Founder of fuseproject, COO at Jawbone

“Companies that produce design-driven innovations value highly their interactions with this network of interpreters. These companies understand that they are immersed in a collective research laboratory through which firms, designers, artists, and schools are conducting their own investigations. These researchers are engaged, explicitly and implicitly, in a continuous dialogue: they exchange insights, interpretations and proposals […]. They test the robustness of their assumptions and share their visions.”
– Roberto Verganti in his book, Design-Driven Innovation (2009)