the wisdom of crowds

03/15/2006 08:52:00 AM
Influx listened with interest to a recent podcast given by James Surowiecki of New Yorker and Wisdom of Crowds fame at a recent SXSW event.

He is an intelligent speaker who is armed and ready with a slew of facts designed to demonstrate just how good crowds are at predicting things. James gives loads of examples from the jellybean guessing experiment, to pari-mutuel wagering through to real life corporate cases of HP, Google, and the Hollywood Stock Exchange all who have used the power of crowds to make accurate predictions.

Surowiecki hints at the failure of market research to really tap into this idea.

He slams focus groups for being dominated by one or two individuals and for telling people what they want to hear.

He suggests that researchers ask crowds to act more like consultants, rather than individuals, imagining likely outcomes by forcing them to determine if a market, rather than themselves, would respond favorably to a product.

This is the opposite of most research, which concentrates on trying to understand personal responses and reactions.

It seems that there's lots of academic thoery out there that suggests crowds are pretty accurate at predicting future outcomes.

How come we aren't really using them?

Can anyone shed more light on companies and researchers that are exploring this area of prediction through crowds?
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