Outsourcing Vs. Crowdsourcing:Time to Know the Distinctness


Before getting into the nitty-gritty, let us first take a glance at what exactly is denoted by these 2 terms. As the name suggests, crowdsourcing is the process by which services are obtained on the lines of content, ideas, etc. from a respectively larger group of people. A contemporary business term coined in the year 2005, crowdsourcing usually involves a large online community instead of the conventional means of hiring employees. It is an amalgamation of the incessant efforts of multiple individual freelancers or volunteers or part-time workers per se.

Outsourcing is the process of extending a service contract to a third party i.e. it is the process of handing over control of a particular work domain to a separate company, organization, or a set of individuals. It is the current buzzword in the niche of worldwide technology. It is often undertaken by companies and businesses around the globe so as to benefit from lower labor expenses, significantly enhanced service quality, and meeting project deadlines.

Crowdsourcing is something different from outsourcing. We need to know the differences between them that separate and distinguish the two. They are as follows:



A team in Ukraine, India or also an onshoring solution in the United States will certainly have the ability to reduce your cost. You pay as per hours of human labor and you can source labor cheaply as compared to hiring them internally. Regardless of the results in the form of the quality of the delivered solutions and costly delays, you pay as per hour for human labor.


Out here where the competition is actually the driver of the production, the pay is done as per the best quality output at a certain locked amount. You don’t require to pay as per hour as you might be not sure about how productive a certain hour went for your company. Now, you can easily calculate the cost per quality output.



You are actually augmenting the labor force of yours. Out here a pool of developers takes charge of traditionally done in-house. Work is assigned to individuals that are managed or kept in rather a traditional way. A particular individual might have a bad day and that can be evident throughout the project. If this wasn’t the thing, outsourcing would solve the ails of IT.


It is very rare that all the submissions are done by just one person. By studying or judging a community, that is driven certainly by competition, many good solutions are provided and the best out of the lot is selected. The elimination of a single point of failure allows cancelling the randomness and that is actually the human life. For instance: If a qualified individual has a bad day or decides not to work, another qualified person is having a good time and is eager to compete.



If you look out for more people, the odds of you getting the right ones will be more. It is just plain simple common sense! When you’re outsourcing your project needs to a specific pool of individuals, they might not be entirely fit to suit your needs. This will not only waste your time, but your money as well as you would then need to find a suitable party from scratch.


A good community grows everyday and adds new skills to it consistently while it grows. Hence, there will never be a shortage of people who possess a certain skill set. And since the number of individuals is high, there will always be room for replacements.



This is still in a labor based model and the reason for this is because the output greatly depends on individuals consistently succeeding over time, the model breaks down. The quality can suffer tremendously as well as costs can be high, time-lines are not met.


In an appropriate and ideal community setting, every part of a project is transparent. The meaning of this in a simple way is that you know which members are registering and their record in the proficiency required submitting a good solution. Competitions have time-lines and they need to be met to qualify and the ability of yours to predict the result or what would happen of any project increases exponentially.


Crowdsourcing Vs. Outsourcing

These are two business based solutions which may or may not work for your organization. Ergo, choose wisely! Both have their own set of pros and cons. A little research doesn’t hurt anybody.

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