Surowiecki, James: “The Wisdom of crowds”

20. May 2009

A bunch of interesting studies – no complete train of thoughts

Did you know, that hundred people can be smarter than the smartest person in the group? Can you imagine that the stock market needed 20 minutes to know who was responsibly for the Challenger-crash? And did you know that the crash of the space shuttle Columbia only exploded because of a wrong composition and hierarchy inside their security-group? You didn’t know that? No Problem! James Surowiecki will tell you about these and some other behaviours of a human mob. The only thing you have to do is to read his book “The wisdom of crowds”, published 2004 on Anchor books (a sublabel of Random House).

In this book Surowiecki referred about the mentalities of human crows from different viewpoints. He tries to figure out what kind of structure a groups needs to be smarter than every several persons in it. For this aim he uses many analysis and studies of the last two centuries. Within these explaines Surowiecki the different social behaviour of humans in the crowd context. The examples effect economical, politic and social problems likewise. A look on the subtitle of the book shows his huge intention: “Why the many are smarter than the few and how collective wisdom shapes business, economies, societies and nations”. Everybody can identify with the mob mentalities. And everybody has to. Because we are all part of the mob.

Surowiecki’s final conclusion is a distinction between three different types of problems which affect a crowd: cognition, cooperation and coordination problems. For every kind of problem you need to respect different rules to create a smart crowd. And sometimes these rules act against each other. This sounds like chaos and actually it is. Our whole society works by a chaotic combination of different crowd phenomena. The stock market is the best example for that. Surowiecki’s book seems to have the key to break this chaos, but it has not. That is the biggest problem of the book. Surowiecki gives a lot of different answers and mention a lot of different rules and no-goes for a smart group. But a concrete arrangement of this rules and studies is missing.

So it is the readers work to the arrange Surowiecki’s references. How, for example would you interpret this situation? It is not good for a company to have a straight hierarchy with a all-powerfull head, because that kills the vantages of the crowds wisdom. On the other hand it is also not good to have to much multi-plane debate-groups, because that extend the decision trees and disconnect every group from the aim of the company. This example shows the whole dilemma of crowds. There are very good in finding the right solution, but there are also very good in following synergetic effects and forget there common goal. The same problem shows up with the mass of information because of the internet. Information are important to find good solutions, but to much information can, in special cases be counterproductive (Friedrich von Hayek combine this two points: the mass of information makes it impossible to create a omniscient group.

In one of my last blogs I gainsay Cass R. Sunsteins fear about a radicalisation of balkanaised groups, he pointed out in his text “The daily we”. Surowiecki mentions Sunstein’s studies and the phenomenon of group-radicalisation in his book. But Surowiecki identifies the radicalisation only as problem of group-compositions. For that reason he cites a study of Alan S. Blinder and John Morgan, which shows that a good organised small group can be smarter than every single member of the group. His conclusion is, that groups are only smarter, when there decision comes off a free, open and unhierarchic discussion.

At least I would like to say that Surowiecki book led me to this thoughts. It gave me a lot of basis information about my view of human beings. So when you are not searching for a complete train of thoughts, when you like to know more about the different originalities of the human species collected in groups and when you want at least a bit entertainment than is Surowiecki’s book a right solution. When you searching for concrete answers to compose a efficient group system in your company – read something else.

This is the start-up

9. March 2009

This is my first post on this blog. Now I’ll explain short what I’ll going to do durig the next weeks. You can follow the hole development of my network-projekt from academic work to pointless thoughts here. For that reason I’ll read a lot of articles and some books and comment them. The first book I’m going to read is “The wisdom of crowds” from James Surowiecki. I hope I get some informations about how a network works and which synergetic effects a crowds needs. If somebody has an idea, a recommend, a tip which could help me – you are welcome. I’m happy about everthing. Also about pointless thoughts.

See you Frank Wombat