Crowdsourcing has rapidly evolved from a niche product innovation tool to a common strategy employed by entrepreneurs and Fortune 500 companies alike. As digital technology develops and millennials increasingly enter and influence the workforce, crowdsourcing is shaping the way people relate to their work and how businesses innovate.
At the same time, 2014 report commissioned by the Freelancers Union estimates that 34 percent of the U.S workforce is engaged in at least some kind of freelance work. This includes traditional employees who moonlight as freelancers as well as individuals who split their work time between freelancing and conventional employment. That’s a huge number, and it seems to be growing. Some estimate that by 2020, half of the U.S workforce will be freelancing.
Of course, freelancing and crowdsourcing are not the same thing. But, as it turns out, they are very directly related.
The explosive growth of freelancing indicates a very significant shift in the economy. This shift is the result of the widespread use of the Internet, and this is the same process that is growing the interest in and effectiveness of crowdsourcing. Skilled workers are increasingly mobile and less tied to single employers. Talented workers of all ages are attracted to the freedom of setting their own schedule and choosing which projects to work on. This means that the talent pool available to businesses interested in crowdsourcing is growing as the workforce becomes increasingly centered around the concept of the gig.
The Benefits of Crowdsourcing and Freelancers
As with any economic change or development, there are pitfalls and drawbacks to the emerging digital, distributed workforce. But, there are also tons of opportunities. Reduced overheads, fast solutions, and efficient time management are some of the benefits offered by freelancers. Crowdsourcing offers increased community engagement, enhanced innovation, and diversity.
Reduced Costs and Lower Overheads
This is probably the most obvious benefit of crowdsourcing, but that doesn’t mean it’s not an important one. Crowdsourcing can be an extremely cost-effective way for businesses and independent entrepreneurs to get the design services the need. Sometimes, startups don’t have the budget to hire a traditional product design firm or to keep an industrial designer on the payroll. Crowdsourcing offers a mechanism by which small businesses on a budget can access a wide pool of talent. Instead of hiring a firm to come up with exciting product design solutions, developers can instead put out a call to their customers for design suggestions, or can turn their design problem into a challenge for the online community of problem solvers and engineers.
Similarly, freelancers can be a great solution for budget-strapped businesses. Because freelancers are brought on for a specific task or project, there is no worry about inefficient down-time. Talented freelancers can provide the same level of services as in-house employees, but with significantly lower overheads. This gives you more leeway as a company to put your resources to use most effectively.
Increased Flexibility
Both crowdsourcing and working with freelancers allow companies to direct their spending precisely where they need to, when they need to. This is a great benefit for startups, or any kind of business that experiences significant ebbs and flows of customer activity. It allows you to hire extra help during times of plenty, and when budgets are tight, you simply don’t need to hire anyone on. No fuss, no drama.
Crowdsourcing offers another kind of flexibility which is particularly valuable when it comes to creative tasks like product design and concept development. With contributions coming from a wide cross-section of individuals, often from around the world and always with a diversity of opinions and backgrounds, crowdsourcing has a unique potential for producing a wide selection of options from which to choose. And choice is a powerful thing.
With so many options to choose from, there’s plenty of opportunity to be inspired and to find your design heading in a direction you hadn’t even anticipated. Even submissions which you don’t ultimately pursue can be valuable sources of inspiration — both for the host company as well as other designers participating in the crowdsourcing project.
It used to be the case that freelancers were seen as lower status or of lesser quality. With more and more talented workers — particularly young people — choosing to work as freelancers rather than commit themselves to any single employer, the quality of freelance services are comparable to those you might get from in-house staff.
So why are so many people freelancing? Part of the explanation has to do with large-scale economic and social changes brought about by the spread of digital technology. But it’s also largely because freelancers enjoy the flexibility that it provides them as much as companies do. While freelancers give businesses the flexibility of hiring for specific tasks and putting their resources to use efficiently, freelancers in return gain the flexibility of determining, to a greater extent, their work schedules. Not having to be in an office for set times every day can be a great advantage, and so the flexibility of freelancing is a benefit that goes both ways.
What Companies are Doing
In addition to increasingly relying on freelance design services, major firms are pursuing a number of creative strategies for bringing in outside viewpoints. This phenomenon is an aspect of the emerging business paradigm known as open innovation, which is based on the philosophy that, in the modern world, collaboration and information sharing produces better designs and results in increased profits compared to the old-fashioned approach of hoarding knowledge and keeping everything in house.
The proof is in the pudding. Plenty of international companies are embracing crowdsourcing and open innovation.
Lego has an ongoing crowdsourcing project called LEGO Ideas. This is an open crowdsourcing program where fans of the classic toys can submit their own ideas for Lego playsets. If their ideas garner enough support, they could be accepted by Lego and turned into a real product. The designer gets credit for their work, 10 free copies of the playset they designed, and, best of all, a 1% royalty on all sales. That’s not a bad deal at all! And it works for Lego, too. It doesn’t cost them much to run the program, and they get all kinds of neat ideas submitted, many of which become popular sets on store shelves.
Anheuser-Busch, the makers of Budweiser beer, introduced a new beer in 2013 which they called Black Crown. This new beer was the result of a crowdsourcing campaign which saw input from 25,000 beer drinkers. This project was a combination of a kind of internal crowdsourcing contest with external customer feedback. 12 Budweiser brewmaster submitted 12 different takes on the ultimate Bud beer. Of these, six were put forward for consideration from the general public. After hearing the opinions of tens of thousands of beer fans, the winner was chosen and released as Black Crown.
Meanwhile, the growth of online freelancing platforms shows that many companies in the U.S and around the world are interested in hiring freelancers. While some sites, like Amazon’s Mechaical Turk, focus on repetitive tasks and pay very low wages, the demand for skilled workers in fields ranging from design and engineering to content writing and law is fueling the growth of well-paying jobs online. Many freelancers working through online platforms are making $25-30 or more — rates comparable to what they could be making as conventional employees.
What You Can Do
There are a number of ways for businesses and entrepreneurs to take advantage of the emerging online gig economy. Whatever approach you choose will likely depend upon the nature of your project and your business. But, given that there are so many different ways to tap into the mobile workforce, there’s sure to be a strategy that works for you.
Crowdsourcing Contests
Crowdsourced design competitions, like the ones we hold on Cad Crowd, are a great way to take advantage of open innovation. Because you get to set the parameters and the prizes, this method is open to anyone, whether a large established firm or a fresh startup or even individuals with a specific design problem.
The premise is simple: when you host the contest, you provide as detailed a project description as possible, laying out the specific problem you need the community to solve. You also determine a prize that you think is fair. You can set the price so that it is affordable for you, but it’s important to remember that the number and quality of submissions that you receive is largely dependent on the prizes being reasonable.
Crowdsourcing from Users
A slightly different approach is to do what the makers of Budweiser did when they turned to their consumers for their input on what should be their next beer. Your customers can be a valuable source of information, inspiration, and innovation. It is, after all, they who will eventually buy your product. Strategies for tapping into customer input range from LEGO Ideas style of accepting proposals for new designs, to asking customers to guide the design process by providing information on their likes and dislikes, or asking what kinds of features they would like to see.
This is a great way to put your email lists to use. You can also set up a dedicated website or subsection of your main website to solicit this kind of information from users.
Outsourcing to Talented Freelancers
Of course, when it comes to hiring freelancers, the biggest challenge is to ensure that you are bringing on experienced, skillful, and talented experts who will put your money to good use. Since the nature of freelancing is such that you aren’t likely to have an existing relationship with them when you first hire them, it’s important for there to be some kind of mechanism for selecting the best candidate.
The standard approach is to put up a job posting and have freelancers bid on the project. You then can select a candidate based on their portfolio, their CV, and their quote. The downside to this strategy is that it can be quite time-consuming for the people doing the hiring. Particularly for entrepreneurs and startups, this can be a significant limitation.
Cad Crowd offers a slightly different approach. Instead of sifting through bids and resumes, Cad Crowd takes a look at your project description, sends you a free quote for the cost of the project, and then hand-selects a designer for you from our roster of expert CAD and engineering freelancers. We only connect clients with top-tier designers who we have vetted. Working with pre-qualified designers this way helps to take some of the strain off of online hiring.
If you’re looking to hire expert freelancers or to take advantage of crowdsourcing design contests, you’ve come to the right place! Whatever the nature or scope of your design project, we have the 3D design, product development, and engineering expertise you need to hit it out of the park. Submit your project for a free quote today. What have you got to lose?