Tuesday, May 4, 2010

FEI2010 Keynote – Success Through Synergy: The Wisdom of Crowds

C. Engdahl reporting from FEI2010

Success Through Synergy: The Wisdom of Crowds
Presented by James Surowiecki, author of the book The Wisdom of Crowds

In a presentation filled with illuminating storytelling, James Surowiecki in his keynote address to a capacity crowd at FEI2010 provided compelling evidence for the powerful nature of crowd wisdom. Utilizing a diverse set of stories (most of which appear in more detail in his book The Wisdom of Crowds) – such as the classic “Jelly Bean in the Jar” guessing game, the “Poll the Audience” from Who Wants to be a Millionaire, experiments conducted by Eric Von Hippel at MIT, and the rescue operation surrounding the Scorpion submarine - Mr. Surowiecki drew a connection between crowd wisdom and innovation. Under the right circumstances groups of people can be more intelligent, successful, and innovative than even the smartest individuals. The key to crowd success is creating the “right circumstances.”

One of these “right circumstances” is diversity. Diversity within a group is arguably the most important quality associated with successful group decision-making. By diversity, Mr. Surowiecki doesn’t necessarily simply mean diversity in age or gender (although this is how diversity may manifest itself within an organization). Rather Surowiecki means “cognitive diversity” and “diversity of heuristics” (the method by which a problem is solved or perceived). The “way in which people think” is important to group success. Surowiecki doesn’t suggest you actually hire for stupidity to make your organization more cognitively diverse, but rather create diversity in mindsets (perhaps by assembling groups with multi-cultural backgrounds or diverse training histories). “Corporations often get locked into certain collective mindsets”, suggests Surowiecki. “Accept the fact that everyone will make cognitive mistakes when making decisions. The trick is to assemble a group of people that don’t all make the same cognitive mistakes.” Mindsets are what are truly important.

The irony, and thus the challenge for organizations, is that diverse teams have a harder time working together. “Diverse teams may be more successful,” Mr. Surowiecki points outs, “but people don’t necessarily like working within them.” People prefer working in homogeneous groups. There’s less conflict. Quality decisions however, and innovative ideas emerge from conflict. Be open to this conflict and the ideas that emerge from unlikely places.

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