Collective intelligence will be a key competitive advantage in the 21st Century....


Never before has there been a better medium to tap the collective intelligence than the Web.
The very first issue of my newsletter that I published on June 24, 1996, was about the potential of collective intelligence. The Internet allows customers, and other often-disparate groups, to organize and have their voice heard in a unified and powerful manner.
The Wisdom of Crowds by James Surowiecki is one of the most inspiring books I have read in the last 10 years. It articulates the "big idea" of the Internet and a big shift in modern society.
Society has grown up. We can and are thinking for ourselves. Experts play a very important role but they are no longer unquestionable. We are moving beyond fundamentalism. The doctor, the policeman, the teacher, the politician, the priest, the car salesman-they are no longer above question.
That is why we are seeing such a reaction from the remaining fundamentalists. They can't bear the idea of a society thinking for itself.
Can the crowd be wise? Yes, according to Surowiecki. And in the right circumstances it can be wiser than any one expert. Surowiecki gives numerous fascinating examples where collective intelligence proved more accurate than the individual opinions of experts.
The best known example of the wisdom of crowds is democracy. Surowiecki's book begins in 1906, as it takes us on a trip to the Plymouth country fair with British scientist Francis Galton.
"Breeding mattered to Galton because he believed that only a few people had the characteristics necessary to keep society healthy," Surowiecki writes. So Galton was not a big fan of democracy.
Galton came across a competition to judge the weight of an ox. Some 800 people had entered this competition. "They were a diverse lot," just like in a democracy, and Galton thought he could prove how stupid the crowd was. He got the tickets from the competition organizers and averaged the results. The average weight guessed was 1,197 pounds. The actual weight was 1,198 pounds.
Of course, crowds are not always wise. You don't call for a vote of what to do if your house is burning down. You don't call for a vote every time you have a problem. Collective intelligence is also not group think. It is not about having a group of people in a room and asking them to come up with a decision. In such situations, what you usually end up getting is a decision heavily influenced by the dominant figures in the room.
The trick of collective intelligence seems to be to get a representative sample of people to make independent decisions on a given question and to compile the results.
So what has all this got to do with your Website? Think of Google, eBay and Amazon. They all tap the collective intelligence through compiling and averaging reader book ratings, buyer feedback, and third-party links.
For the first time, the Internet allows us to use collective intelligence on a potentially massive scale and in a highly
cost-effective manner. Tapping the collective intelligence has many advantages. It brings us closer to our customers and it enhances trust, as customers tend to see sites as trustworthy that represent the views of other customers.