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June 27, 2012

Is crowdsourcing the best way to innovate?

Crowdsourcing has become the new buzz-word in entrepreneurial circles around the world, but is it the best way to innovate? Nokia Connects explores…

via James Cridland

‘Two heads are better than one,’ as the saying goes, and it might just be than multiple heads are even better than two when it comes to finding new ways to innovate. The notion of crowdsourcing – using many people to do what is normally only done by a few – is not new. Wikipedia is perhaps one of the best-known early crowdsourcing platforms, where anyone can submit their knowledge to a self-regulated database. And here at Nokia Connects we’ve crowdsourced some great content on more than one occasion – like your PureView pics, for example!

More recently, governments and companies have been turning to crowdsourcing. Take Iceland, for instance, who used social media to get citizens to share their ideas about the country’s new constitution; while BP asked the public for suggestions on how to tackle the Deepwater Horizon oil spill. And its not just big names that can benefit from the wisdom of crowds; crowdfunding websites such as Kickstarter are turning the tables on how people create and develop their own projects, making it easier than ever to innovate.

Crowdsourcing does seem to be paving the way for future innovations, but is it really something new? There was a time when all companies had employee suggestion boxes where workers could post ideas – essentially crowdsourcing from the existing workforce. One urban legend has it that it was an employee who suggested to the matchbox company Swan Vestas that they could have one instead of two sandpaper strips on the matchbox, lowering productions costs and boosting profits. But in the age of social media, this type of crowdsourcing has been thrown wide open, allowing ordinary citizens to make suggestions about the running of companies, businesses and even their governments.

So crowdsourcing is certainly not new, even though it is bigger and more inclusive than ever, but does it really work? The problem with outsourcing tasks to huge numbers of variably-skilled people is inevitably the risk of inaccuracy; Wikipedia being a prime example of this. Also, the sheer volume of potential responses (BP allegedly received 20,000 suggestions to their Deepwater crisis appeal) makes it difficult to sift the wheat from the chaff – what is the likelihood that BP actually went through each suggestion? More likely they simply used the idea of crowdsourcing as a PR tool to get people back ‘onside’.

via shmula

And again with crowdfunded platforms such as Kickstarter, the projects most likely to get high levels of funding are those that already have a clear business strategy and product, and more than 40% of new projects fail. This suggests that crowdfunding might not quite be the holy grail it is portrayed as.

So, what do you think? Is crowdsourcing the future of innovation or is it nothing particularly new or exciting? Join the debate in the comments below or on Twitter @Nokia_Connects.