The Wisdom of Crowds, Group A

This site will reflect our group's discussion on The Wisdom of Crowds, by James Surowiecki.

Surowiecki's Theory

What Makes a Good Crowd

  • Decentralization

In chapter four of The Wisdom of Crowds, Surowiecki discusses that after World War II, it was thought that a centralized group should be created to defend the United States from outside predators. The Central Intelligence Agency (CIA) was formed, but centralization of intelligence is not what happened, instead decentralization occurred. Many other intelligence groups formed under the CIA all working towards one goal, but using different areas of expertise When the attacks on September 11th occurred, an inquiry was issued and revealed the flaws with the decentralization of these groups; it was found that there was a lack of sharing information between organizations. If Surowiecki’s point in this book is about having working as specialized groups, how did these intelligence organizations fail due to decentralization.

In decentralization it is important that individuals have specialization in different areas. Having specialization creates more work done by groups, but it also pulls different views and opinions in decision making. Decentralization is good because it fosters independence in groups, but it is never a sure thing if all information discovered in groups will be brought forth. The idea is that individuals with specialties will each provide knowledge and information to the group but this information must be able to be used collectively and be local and specific
The problem faced by the U.S. intelligence community was that it was not using the right kind of decentralization. While each group was specialized, there was not much diversity; therefore what seemed unimportant to one group could have been valuable information to another. The problem was there was nothing to aggregate the information or for all organizations to share their information. Decentralization could have worked for the intelligence community had they done something simple like creating a database for all groups to share information on, this would be a solution that would not be a top to bottom structure

Problems within Groups
Polarization is seen as when people are put into a group to collaboratively deal with a certain situation or decision and the group as a whole has an overriding attitude toward the situation. Over time and with group discussion, the groups attitude and outcome of the situation may change. Polarization occurs because people are reliant are “social comparison.” People are continually comparing themselves to one another. Surowiecki states “…If you start out in the middle of the group and you believe the group has moved, as it were, to the right, you’re inclined to shift your position to the right as well, so that relative to everyone else you’re standing still.” Although, “social comparison” is critical to people it is important to realize that polarization is not the result of people trying to stay uniformed with the rest of the group. When a group is deliberating on the situation, a group member that is unsure of the situation is far less apt to voice their opinions, unlike a group member who has strong arguments. The group member that has a higher status (not specific to the group) and continually states their arguments are more likely to persuade and convince the uncertain team members in favor of their position.
Status, in a group is believed to form and shape speaking patterns within the group. The majority of the time the higher-status group members will be the most talkative, while the lower status members feel inadequate and will speak less and less. Although, if the status of the group was formed around the expertise of the situation it would not be an issue, most of the time people in higher-status will continue to talk and give their arguments when they really do not know what they are stating. Group members with higher-status then other members in their group try to out talk one another which coincides with just talking to hear themselves talk.
Talkativeness has a large impact on the outcome of small groups decisions. If a group member talks significantly more then the other members people will automatically think of your works to be influential. Although they are listened too, talkative members are not necessarily liked by their fellow group members. Many times members that are most talkative tend to become the center of the group which makes them a more powerful influent throughout the course of the situation. Surowiecki states, “ This might be okay if people only spoke when they had expertise in a particular matter. And in many cases, if someone’s talking a lot, it’s a good sign that they have something valuable to add.” Group members with higher-status have not been scientifically proven that because of their status they are an expert on the situation.

Madison Tannenbaum & Nikki Oswald

Our Findings/Polls

Relating WOC to the Fashion Industry

Relating WOC to Fashion Students

  • In the situation of groupthink, do we (as students of fashion and of a small college) get into such a routine way of doing things that it stifles our creativity?
  • Does it hinder our success if we don't allow for diversity in groups, such as if we were divided into groups by major rather than mixed?
  • How much do others influence our choices on things like which college to go to, what major to choose and which career path to follow? And how much do they influence even smaller decisions, such as what type of fabric or color to use in a design?
  • Would we choose a higher paying job we didn't love, or a lower paying job we hated?
  • In what ways do we already collaborate successfully as a team?

* Design students collaborate with teachers, jury and their peers for opinions on design and construction. In fittings, two heads is usually better than one.

  • What motivates us besides money?

Independence:
-It is more likely that a group will come up with a good decision if people think independently
-Independence is important for two reasons according to Surowiecki
-It keeps the mistakes that people make from becoming correlated
-Independent individuals are more likely to have new information rather than the same
data everyone is already familiar with
-Without independence, groups can fall into groupthink where they have no diversity in their decision making
-people can influence each other to believe the same things which could make the group dumber

HERE IS THE FINAL COPY OF THE PAPER: THE ORDER IS MORE OR LESS THE SAME AS THE ORDER OF OUR PRESENTATION

2008

Current Issues

Courtney Cothren

Nov 10, 2008

[WISDOM OF CROWDS; GROUP A]

Jennifer Alander, Katie Altmann, Elizabeth Anson, Bonnie Craighead, Katie Dillman, Jennifer Edwards, Nikki Oswald, Ashley Ray, Madison Tannenbaum


As James Surowiecki states, there are three fundamental characteristics that make up a good group decision: diversity, independence, and decentralization (21). “Diversity contributes not just by adding different perspectives to the group, but also by making it easier for individuals to say what they really think” (39). It is established within the first few chapters of the book that the more people involved in a group discussion, the better the result. The more diverse the crowd is, the more knowledge, experiences, beliefs, etc. will be involved which leads to a better overall outcome. “Individual judgment is not accurate enough or consistent enough, cognitive diversity is essential to good decision making … it expands a group’s set of possible solutions and allows the group to conceptualize problems in novel ways” (36).

Groups that are not diversified in any aspect and “are too much alike find it harder to keep learning, because each member is bringing less and less information to the table” (31). On the contrary a diverse group of individuals makes the group smarter because each individual knows something different about the subject and is not redundant to everyone else. It is hard to have a successful and collectively wise group without diversity.

The second element that is needed for a successful crowd is independence. When people think independently, they add diversity to the group rather than falling victim to groupthink. James Surowiecki believes independence is vital for intelligent decision making because “it keeps the mistakes that people make from becoming correlated. Also, independent individuals are more likely to have new information rather than the same old data everyone is already familiar with” (Surowiecki, 2005). If people are irrational, yet independent, they will not make the group dumber. Groups get into trouble when people start thinking alike and do not offer any new, independent ways of thinking. However, it can be hard for people to remain independent in their thinking because learning is a social process. People’s thoughts and feelings are created by how and where they grew up. With different experiences, people have to learn how to think and feel while remaining independent so they can add a different dynamic to the groups they will work with.

In chapter four of The Wisdom of Crowds, Surowiecki discusses that after World War II, it was thought that a centralized group should be created to defend the United States from outside predators. The Central Intelligence Agency (CIA) was formed, but centralization of intelligence is not what happened, instead decentralization occurred. Many other intelligence groups formed under the CIA all working towards one goal, but using different areas of expertise (Surowiecki 2005). When the attacks on September 11th occurred, an inquiry was issued and revealed the flaws with the decentralization of these groups; it was found that there was a lack of sharing information between organizations. If Surowiecki’s point in this book is about having working as specialized groups, how did these intelligence organizations fail due to decentralization (67-69).

In decentralization it is important that individuals have specialization in different areas. Having specialization creates more work done by groups, but it also pulls different views and opinions in decision making. Decentralization is good because it fosters independence in groups, but it is never a sure thing if all information discovered in groups will be brought forth. The idea is that individuals with specialties will each provide knowledge and information to the group but this information must be able to be used collectively and be local and specific (72).

The problem faced by the U.S. intelligence community was that it was not using the right kind of decentralization. While each group was specialized, there was not much diversity; therefore what seemed unimportant to one group could have been valuable information to another. The problem was there was nothing to aggregate the information or for all organizations to share their information. Decentralization could have worked for the intelligence community had they done something simple like creating a database for all groups to share information on, this would be a solution that would not be a top to bottom structure (77-78).

Surowiecki describes some of the problems that occur within groups as well, such as polarization, status and talkativeness. Polarization is seen as when people are put into a group to collaboratively deal with a certain situation or decision and the group as a whole has an overriding attitude toward the situation. Over time and with group discussion, the groups attitude and outcome of the situation may change. Polarization occurs because people are reliant are “social comparison.” People are continually comparing themselves to one another. Surowiecki states “…If you start out in the middle of the group and you believe the group has moved, as it were, to the right, you’re inclined to shift your position to the right as well, so that relative to everyone else you’re standing still.” Although, “social comparison” is critical to people it is important to realize that polarization is not the result of people trying to stay uniformed with the rest of the group. When a group is deliberating on the situation, a group member that is unsure of the situation is far less apt to voice their opinions, unlike a group member who has strong arguments. The group member that has a higher status (not specific to the group) and continually states their arguments are more likely to persuade and convince the uncertain team members in favor of their position.

Status, in a group is believed to form and shape speaking patterns within the group. The majority of the time the higher-status group members will be the most talkative, while the lower status members feel inadequate and will speak less and less. Although, if the status of the group was formed around the expertise of the situation it would not be an issue, most of the time people in higher-status will continue to talk and give their arguments when they really do not know what they are stating. Group members with higher-status then other members in their group try to out talk one another which coincides with just talking to hear themselves talk.

Talkativeness has a large impact on the outcome of small groups’ decisions. If a group member talks significantly more than other members, people will automatically think of his or her works as influential. Although they are listened to, talkative members are not necessarily liked by their fellow group members. Many times members that are most talkative tend to become the center of the group which makes them a more powerful influent throughout the course of the situation. Surowiecki states, “This might be okay if people only spoke when they had expertise in a particular matter. And in many cases, if someone’s talking a lot, it’s a good sign that they have something valuable to add.” Group members with higher-status have not been scientifically proven that because of their status they are an expert on the situation.

To introduce the Wisdom of Crowds theory, Surowiecki describes an experiment conducted by British scientist Francis Galton at a county fair weight-judging contest. People gathered around and took a guess at how much an ox weighed. Among those that guessed the weight of the ox, some were considered experts while others considered average with no knowledge of oxen. The crowd on average was only one pound off from the actual weight of the ox. (XIII) We decided to test the Wisdom of Crowds theory on the Stephens College Campus and in the Current Issues class. For the Current Issues class we held a 2008 Election Poll asking two questions: Who would are you going to vote for in the 2008 Presidential Election? If you had $100, who would you bet will win the 2008 Presidential Election? The results were as follows:

For the Stephens College Campus we held two polls: an “M&M” Poll and a “Where would you meet a friend on campus?” Poll. For the M&M Poll we filled a jar with 255 M&Ms and asked the crowd to guess. The crowd average was 190.21 and only one person guessed the correct amount. Here are the results for the other poll:

The results of our polls were consistent with the Wisdom of Crowds theory. The Presidential Election was correct Obama did win in both polls and in the real election. The M&M poll was off by approximately 65 M&Ms, which could be because of the time constraint on the crowd. Most of the people that were in a rush during the lunch period when we took the poll so their guesses were quick and not thoroughly thought out. The Campus Poll was influenced by the fact that we took the poll in Stamper Commons. Also most people were with a friend that may have influenced their vote. From our results we can see that the crowd must be under the right circumstances to make an informed, correct decision.

Being influenced by a friend in the campus poll could be considered a form of imitation. Imitation works most of the time according to the author. He stated that in the city, to decide if he needed an umbrella for the day, he would step outside and look at the people on the street to see if they were carrying an umbrella and then base his decision on what everyone else was doing, trusting that they checked the weather or knew if it was going to rain or not. (58) In order for this to work one has to hope that the rest of the crowd or public has researched and made a rational decision that it is safe for you to follow without doing you own research.

Although imitation works in ones favor most of the time, there can be negative effects associated with following the crowd and trusting its knowledge. For example, at the homecoming football game Bonnie trusted that since there were cars parked all up and down the side of the street outside the stadium that she too could park on that side of the street. In this case she should have done her own research because at the end of the street there was a “no parking this side” road sign that she didn’t see until all the cars, including hers, had all been towed. In that instance the wisdom of crowds failed her. On the other hand, when she walks outside to go to class on Thursdays and sees everyone else’s trash out, she thinks to put hers out as well and in this case the wisdom of her neighbors as a crowd is very beneficial to her.

Relative to fashion, the Wisdom of Crowds theory can be demonstrated through fads and trends in the form of “social proof”, which is the tendency to assume that if lots of people are doing something there must be a good reason for it. (43) Surowiecki uses the following example to illustrate social proof; In 1968 psychologists ran an experiment, starting with only one person standing on a corner looking up, they observed people walking by to see if others would stop and see what he was looking at. When one person was on the corner only a fraction stopped to see what he was looking at, so then they put five men on the corner and four times as many people stopped to look. Then fourteen men where place on the corner and more than 85% of people passing by looked up. This is just another example of how people rely on or trust the wisdom of crowds, when more people were added on the corner more people were willing to conform and imitate the actions of the group. (43)

Social proof has an impact not only on consumers but on designers as well. More and more designers are looking to the streets for inspiration. Instead of the traditional “trickle down theory” of fashion, trends are starting on the streets and winding up in couture shows. Likewise in fashion media, more and more publications are featuring street styles over runway trends. This supports the Wisdom of Crowds theory that a group of average people may be wiser than the “expert” or in this case a high fashion designer or magazine editor.

As students of fashion, we have all experienced working in groups and will continue to work in groups throughout our career. Many of the ideas in The Wisdom of Crowds relate to our daily lives, in particular Irving Janis’ idea of “groupthink”. Groupthink occurs when group members are too much alike in their worldview and mindset, omitting diversity and in turn resulting in a less-informed, mediocre decision. This could certainly occur to fashion students who work with each other on a daily basis. Have we fallen in to a routine way of doing things that has stifled our creativity? For example, as design students, perhaps working with the same teachers and students everyday creates monotony. We begin to predict what the teachers will expect and in turn develop styles that will suit their grading scale rather than utilizing our creativity. How can we use diversity to overcome these barriers? We could possibly prevent monotony by spending time with those outside of the fashion world and look for inspiration and influence in all aspects of life.

Surowiecki discusses the idea that people focus better on a decision when there are financial rewards attached to it. As students, we have hundreds of questions and decisions to answer each day that help us to either succeed or fail. However, for all of these answers and hard work, rather than being monetarily rewarded we are billed for the price of school. Students most likely feel responsible for the money spent towards tuition, and know that if they do well they will earn a job that’s pay will make up for the costs of school. Others may be driven by competition and success. When entering college, we had the choice of deciding which career path to follow. What factors influenced our decision? Perhaps we knew others who had chosen a similar major and had become successful. Soon we will be leaving college and entering the fashion industry. Would we choose a higher paying job at a company we did not love or a lower paying job at a company you were passionate about? Without the influence of pay this choice would be simple, however, the financial rewards associated require a more in-depth decision.

Whether one agrees or disagrees with the theories presented in Wisdom of Crowds, the influence crowds can have on society is evident. Increasing personal knowledge of the inclinations of crowds is the first step towards being able to influence a group whether it be as a student, professional, or in personal life.

HERE ARE THE LINKS I PULLED UP DURING THE PRESENTATION:

The first is meant to prove the wisdom of crowds theory by looking at trends and street fashion, even if the trend is RIDICULOUS!! like this one, the more people who are doing it, the more acceptable it is

http://images.google.com/imgres?imgurl=http://www.snopes.com/photos/risque/graphics/trend07.jpg&imgrefurl=http://message.snopes.com/showthread.php%3Ft%3D14211&h=477&w=638&sz=35&hl=en&start=15&um=1&usg=__3vwjSEWTiO9qGyvMgPU4VV-8GEM=&tbnid=Bqk7rJqa_LhaJM:&tbnh=102&tbnw=137&prev=/images%3Fq%3Dbad%2Bfashion%2Btrends%26um%3D1%26hl%3Den%26sa%3DN

The second it to show how comanies can use popular opinion to make pricing decisions.

http://www.bananarepublic.com/browse/product.do?cid=26497&pid=588259

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