Are Crowds Really That Smart?

By now you have heard of or read The Wisdom of Crowds. The idea has become so pervasive that almost every keynoter uses it, usually with a line like, “No person in the room is smarter than everyone else in the room.”

Some think the whole notion is BS.

But, is it really true? Here are some situations where the crowd might be lacking:

1. When they simply don't know what they are talking about.

2. When they say and do things based on inaccurate or incomplete information.

3. When there is a sense of urgency to make a decision, any decision.

4. When group-think sets is.

5. When the crowd is unable or unwilling to reach out to another crowd who might already have solved their

problem.

6. The lemming effect, like investors waiting for someone else to take the lead.

7. When the group fails to admit they are making the wrong decision.

8. When the group does not have a leader to tell them otherwise.

9. When the group gets sidetracked, distracted, or loses focus and obsesses about things that are not important or low stakes. Some call it the rule of academia, i.e., there is an inverse relationship between the amount of time talking about something and its importance.

10. When issues are exceedingly complex and multi-dimensional requiring specific areas of expertise.

Crowds can often make better decisions than any one person. They can also make a lot of noise.