The Wisdom of Crowds

Although they did not know it at the time, 787 villagers at a county fair in 1907 contributed to a study which turned out to have incredible significance in a societal, political and economic sense. At these county fairs farmers would sell livestock such as cows, sheep and Oxen; an expert would give an estimate of the weight of the animal and the customer would pay the corresponding amount. Sir Francis Galton, the half-cousin of the famous Charles Darwin conducted an experiment on the attendees at this particular fair. He questioned several of these experts to estimate the weight of an ox and recorded these; later he asked 787 ordinary fair-goers the same question. The results indicated that although the expert’s estimate was indeed closer than most of the non-experts, what was significant was that the mean estimate of the non-experts was closer than that of the expert.

These findings gave rise to the concept of the ‘wisdom of crowds’, which has been written about in detail in the book by James Surowiecki with the same title. The idea suggests that the average opinion/estimate of a group of people is more accurate and reliable than the single guess of one expert. Demonstrations of this range from counting jelly beans in a jar to decision/prediction marketing. However, it should be noted that this concept does assume that the opinions of the individuals are diverse, independent and decentralized (can draw on local and specialist knowledge).

There are a lot of potential areas in which the wisdom of crowds could be utilised in everyday life and, in many cases, already are. For example, if we look at marketing, in particular focus groups, if a new product is being released, the opinion of one expert on how to design/advertise/sell the product will no doubt be well informed and useful. However, through the use of focus groups, crowdsourcing and surveys, the use of a large group of people’s opinions is often more effective and targeted and reflects the opinions of different genders, ages and cultural backgrounds of potential consumers of the product.

Another avenue for the use of this method is artificial intelligence (AI). The market value of AI is predicted to reach almost £1 trillion by the year 2020, with investment in AI predicted to triple and the potential for this technology cannot be understated. Through the wisdom of crowds and crowdsourcing in particular, data can be gathered more extensively and quickly, for example daily health information on individuals could be collated to help in the production of new drugs. By using crowdsourcing to provide AI with knowledge rather than only that of the developers, the abundance and diversity of the data would allow AI to be educated to a much greater and broader extent.

Overall the theory of wisdom of crowds stands to emphasise the importance of diversity of opinion through diversity of people. Organizations should perhaps put more emphasis on collaborative change through obtaining the thoughts and concerns of all of its employees rather than a select few at the top. Additionally, this serves as a reminder as to the importance of diversity in general as only through encouraging this will the potential of the wisdom of crowds be fully realised in any application.