Expert says SMEs must increase crowdsourcing to cut margins, drive innovation

Businesses need to start using more crowdsourcing opportunities in order to cut down on costs and create better solutions that can’t be solved in-house, an industry expert has warned.

The warning comes as a number of Australian sites have continued to lead the way with crowdsourcing, with three of the world’s most popular sites founded locally.

Ross Dawson, chairman of the Future Exploration Network and author of a new book, Getting Results from Crowds, says small businesses are missing out by not tapping into a potentially unlimited source of labour.

“There is a very big competitive advantage in being able to tap into that world of talent, which is available to everyone – today. There are organisations that do it much better than others,” he says.

“These organisations are at an advantage. Those that don’t choose to go outside the organisation are just missing out on all that talent.”

Dawson’s warning comes within a framework he envisions for the foreseeable future, where more SMEs will start looking outside their own walls to get tasks done.

“This is an extraordinary trend, and something of vital importance to business owners and managers today. It’s not easy to get results from crowds, but it’s compelling, it’s a very different way of working that can end up doing very well for many businesses.”

Three of the major sites in the crowdsourcing scene – Freelancer, 99designs and DesignCrowd – have started from Australia. Now, they’re turning over millions and have customers across the world, where businesses have been able to source work for a much lower cost than they would if they hired a consultancy firm or other business.

Proponents argue designers and freelancers using these sites also come out on top.

But Dawson says many businesses aren’t using these sites effectively, and need to adopt a number of strategies in order to do so.

“There is a risk in that the quality of the work is not what you expect, but this speaks to what I think is an increasing drive within organisations to start building more quality control processes.”

“It’s easy if you’re doing a project in-house and you’ve got longstanding staff doing all the relevant training and development. But if you start understanding how the organisation works and the processes and standards you’re using, it means you start building better quality control.”

Dawson says another key issue he’s noticed within many businesses is that several are concerned about losing their intellectual property – but he believes it’s not something to be worried about.

“That’s not to say there aren’t risks, but I think they’re overblown. Many entrepreneurs cut themselves off from opportunities by fearing their intellectual property will be lost, but if you take appropriate steps that won’t necessarily happen.”

Dawson says businesses need to start looking at what they can outsource. Not everything can, he says, but other, minimal tasks that don’t need to be done in-house should be pushed out to others in order for in-house staff to focus on more important things.

“There is an abundance of work that can be done outside your organisation. It’s not as simple or as straightforward as it’s sometimes made out to be, but you just need to start choosing platforms to start working.”

“Whether it’s website design or any other sort of design, there are functions within your business that can be readily done in the crowd. The opportunities that are open to any business free them up to do other things.”