Both authors are questioning the interpretation and application of the ideas presented in the book, The Wisdom of Crowds, by James Surowiecki. Surowiecki proposes that many times the group will make better decisions and assumptions as compared to any given individual of that same group.
There are very different and distinct situations and opportunities where groups may outperform individuals and vice versa. There are also fundamental differences in focus, attention and willingness to accept risk, that will significantly affect the outcome of the decision or prediction.
Predictions and Opinions. The use of groups in opinion polls and prediction markets is indisputably more accurate than an individual prediction.
Evolution vs. Revolution. A group or crowd will more often choose evolution (safe, slow, predictable change) over revolution (rapid, drastic, unknown consequences). This favors group stability and leads to incremental changes of the status quo. Decisions of this type are much more easily accepted, embraced and implemented.
New ideas and concepts. Creativity is not favored or accelerated in groups as compared to individuals. Paradigm changing concepts and ideas, leaps in technology, philosophy and science are usually created by individuals.
Human Nature and Teams. Teamwork and working in groups is part of human nature. We are social creatures and business requires the majority of us to work with others. The group interaction and final outcome may be limited or significantly reduced when compared to individual results. The decisions will be accepted and the entire group will support it.
Current business trends are focusing on innovation, and developing processes that allow us to implement innovation systems and to create the methodologies that will assist us in the creation of innovative solutions. It’s natural that we should begin to examine how decisions are made, their innovative or creative component, who makes them, and who makes the correct decisions.
The questions and discussions created by the ideas presented in The Wisdom of Crowds are what is important. Which situations are better served by individual ideas and opinions to find solutions? When should we be using “crowd-think” and groups to assist us in decision making or with our predictions?
Businesspundit: The Idiocy of Crowds