Companies are wasting the potential crowdsourcing offers according to new research in the Academy of Management Journal.

"Distant search, narrow attention: How crowding alters organizations' filtering of suggestions in crowdsourcing" by ESMT's Linus Dahlander and INSEAD'S Henning Piezunka has found that companies are failing to tap the full potential of crowdsourcing for generating innovative ideas.

The authors document that, while many organizations claim they engage in crowdsourcing to seek innovative ideas, they often filter them out once they have been elicited.

System (PD)Dahlander and Piezunka looked at how 922 organizations responded to 105,127 crowdsourced suggestions from external sources. Their results shows that when faced with a large number of crowdsourced suggestions, companies respond to the high volume of information by narrowing their attention to those suggestions that are familiar to them. In essence, they filter out the unfamiliar, thereby ignoring the truly innovative ideas.

With so many companies engaging in crowdsourcing as a means to find innovative ideas from outside their company structure, many would do well to heed the findings of this new study.

Dahlander advises, "Don't be lured or lulled by the crowds. Innovation is not about how many suggestions you receive, but which of the ideas you give attention to. Companies need to either change how they filter such material or perhaps be more selective in the pool of external sources they draw from."

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