THE WISDOM OF CROWDS
James Surowiecki
Innovation, Product Developmeny
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Groups reach better decisions than individuals
In cases where there is a deficiency of information, a "good" crowd would still be able to make fair, unbiased and rational decisions. Whereas a "bad" crowd may lack crucial aspects, such as diversity or independence, and may produce incorrect judgements.
Herd mentality can undermine the potential of crowd decisions.
Groups may often reach incorrect decisions, despite being large and diverse.
The 5 elements required to form a wise crowd are:
1. Diversity of opinions
2. Independence
3. Decentralization
4. Aggregation
5. Trust
Having a diverse group of decision-makers, James Surowiecki writes "helps because it actually adds a perspective that would otherwise be absent and because it takes away, or at least weakens, some of the destructive characteristics of group decision making".
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