Problems, Theories, and Governing the Crowd

Research and recommendations on innovation through crowdsourcing is diverse and often contradictory, providing little guidance on when, where, and under what conditions to use various kinds of crowdsourcing. This paper responds by arguing that focal economic actors, as organization designers, catalyze innovation when they efficiently match attributes of the problem or attributes of a domain of problems to modes of organizing problem finding and solution search. Four basic insights drive this approach. First, sourcing from the crowd is, fundamentally, a governance choice. Second, crowdsourcing is an amalgam of both problem finding and problem solving through the crowd. Third, the attributes of the focal actor shapes problem formulation, solution search, and the governance of that process. Fourth, the act of defining problems reveals, and often generates, a vast residual domain of problems — often unseen by the focal economic actor — that are implicitly deferred to the crowd to find and potentially solve.