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How Crowdsourcing Can Help Companies Innovate Internally

BY LIZ TREADWELL | 4 min read

Why do companies struggle so much with innovation? Fortune 500 companies and other large organizations are very successful at continually improving processes and products, but when it comes to disruptive innovation, they struggle to stay relevant in the marketplace. 


  • Large companies have a hard time creating disruptive innovations within their own walls.
  • Disruptive innovations usually start out as crazy “half-baked” ideas which are usually struck down in corporate environments before they are fully fleshed out.
  • Crowdsourcing uses a global network of effects to increase a company’s rate of innovation.
  • You do not need to be an expert to crowdsource successfully, platforms like HeroX provide a complete solution.


The Struggle of Innovation

Innovation is a huge buzzword these days. Across all industries and even in our daily lives we see the effects of innovation through the constant evolution of technology and the emergence of AI. In order to stay ahead of the curve, companies are always on the hunt for the next big idea or product that will disrupt their industry and catapult them into the top spot.

According to a study conducted by McKinsey & Company, 84% of executives believe that innovation is critical to growth strategy and their business, and 80% say they feel their current business model is in danger of being disrupted in the near future. For those that do attempt an innovation strategy, only 6% are actually satisfied with the outcome.

So why is it that large companies and organizations seem to struggle when it comes to this type of innovation from  within their own walls? 

One reason is that many of the seeds of innovation stem from crazy “half-baked” ideas which usually don’t survive the internal processes of the organization. An employee might approach an executive with an off-the-wall notion only to have it shot down immediately because it is just not “how the company does things.” 

In turn, said employee might eventually get tired of hearing no and jump ship to create their own startup, with the potential to disrupt the industry. The very practices put into place to create order and success are also the same rules that prevent this type of disruptive innovation from fostering.

Another factor appears in Public Sector Organizations (PSOs), where they excel at certain types of innovations, but fall short in other ways. This is obvious in the way that certain products have evolved over the years, like the automobile. They are good at continual improvement, or incremental disruption, but the very systems designed to protect this success can’t survive a sudden rapid rate of growth or strategic redirection.

By using the opportunities presented by market innovation to their own advantage, organizations can boost their internal rate of innovation. The very place that's causing this innovation gap holds the key to closing that gap, and it’s through crowdsourcing.


Utilizing the Market 

Organizations don’t want to lose their top talent do to a lack of creative or modernization and creating their own businesses, so how do they retain employees while continuing to conduct business as usual? 

Most PSOs feel they are falling behind the curve and are unable to keep up with the rate of change within their market and many are unsure of where to start when they try to address the problem. 

The internet has been one of the biggest sources of tech disruption in the last few decades. When the internet came into being, it created a global network effect connecting hundreds of thousands of people together across the world. This is exactly where crowdsourcing comes into play. 

The best way to achieve results is to use the market rate to your advantage. It’s the only reliable way to boost innovation in a company’s favor even though it is exactly what is causing the need in the first place. Leveraging existing technologies creates new tools for open innovation and crowdsourcing. 

Through crowdsourcing, you can leverage the market rate of change to your advantage by utilizing the global network effect and getting in contact with people from different educations and backgrounds who will provide you with new and exciting ideas. 

By tapping into crowdsourcing, you will have access to the collective intelligence and ingenuity of a crowd who is just as passionate about your industry as you are. It also takes the pressure off the company while still giving your top talent new and exciting concepts to work on. 

At HeroX, companies can tap into this network through contests and prize challenges and achieve real solutions they can take to implement into their business. 


The Accessibility of Crowdsourcing

If this is so easy, why isn’t every Fortune 500 company out there using this technique?

The simple answer is that many simply aren’t aware of the possibilities of crowdsourcing, and don’t realize that complete packaged solutions are available to them through platforms like HeroX. Executives also aren’t aware of the power that can come from a crowd, one with unique and diverse experiences. 

Crowdsourcing has been around for centuries. In 1714, the British government issued a challenge reward for anyone who could devise an easier way to precisely determine a ship’s longitude at sea. They created several different prize challenges through this method and awarded people for their design and contributions to timekeepers, timetables, and lunar methods of measurement. 

Today, crowdsourcing can be such a powerful tool, even NASA has seen it’s benefits. In 2011, they created the Center of Excellence for Collaborative Innovation (CoECI) as a way to support research and development efforts. They have numerous external competitions through contractors to tap into the global network and find real-world solutions, and have found great results.

While crowdsourcing may seem like a daunting prospect, companies don’t need to be experts to conduct and run a successful prize challenge. Open innovation is the only solution for the exponential growth required to keep up with today’s climate of rapid change. HeroX is a great way to start experimenting with the global network and find tangible solutions for your company. 


Call to Action

Contact HeroX to find out more about how we can help your organization implement crowdsourcing into your innovation strategy today, and check out our library of open innovation case studies here



  1. Growth and Innovation - McKinsey & Company
  2. Longitude Rewards - Wikipedia
  3. Houston We Have A Podcast - Soundcloud


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