"Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations"

Got this book after reading NY Times profile on Gladwell, I also read the beginning of the book on Amazon

As the title indicates, Surowiecki theorizes that crowds under the right circumstance can be very good at solving problems. He divides the work in two parts: theory and examples. It's mostly good though the real case studies are not that well tied to his concepts

Random Notes
the wisdom of crowds solves three types of problems: cognitive, coordination, cooperation
"wise" crowd attributes: diversity, independence, specific decentralization
Power of custom and convention
Crowd at large has a sense of fairness which influences collaborative and cooperative efforts
Importance of trust

Diversity is essential because expertise and group think have little awareness of self assesment, the ability to question how correct they are. Groupthink underlines masses in their unwillingness to stand out (to stand up)

The "wisdom of crowds" applied to Ask MetaFilter. On Ask MeFi we seek the knowledge of the crowds vs Google Answers where an expert helps out. One issue on MeFi is that the first answers might influence subsequence ones so it may be interesting to have a feature that withholds answers unless there are 10 of them so we are sure that they were independently derived. There might be a problem with repetition but that would reinforce the wisdom of the crowd

To a bigger extent, we can view the power of the crowds on the internet, the author mentions Google, but we can also list mailing lists, newsgroups and forums

The case study about science brings up a recent discussion over authority by Steve Rubel. He mention the Matthew Law but it sounds more like the Power Law (distribution), authority (recognition) is assembled at the top (or one end, the few). The main point in the nascent blogging world is that authority and readership does not guarantee longevity. There's a democracy of ideas rather than a cult of personality. This much is true about how science need to pay more attention to the work rather than authors but how can we filter all the stuff that is out there

Part Two has real life cases of effectiveness and ineffectiveness of crowds

I liked the profile of Spanish clothing store Zara and the ideas of the guiding corporation, inhouse development vs outsourcing

While discussing company decision making, I wish Surowiecki included the model at Google to bubble up ideas at large and its structure of small teams and fewer managerial levels

The biggest idea of the book centers around the concept of futures contracts and the power of decision markets (IEM, HSX) as prediction maker. In that sense the chapter on the Challenger explosion and gambling are probably the most interesting

The final tie to democracy is a bit sketchy, the ultimate wisdom of crowds is not in the person it elects but in the choice of using democracy, participation at large in the process (which he argues is the better of all existing system of government)

This work by Surowiecki shares a lot in style with Gladwell, they both are staff writers for The New Yorker. He writes the business column so ultimately, this is shows in the work with a strength with financial cases. The work suffers a bit of a narrower scope. In that sense it is closer to Freakonomics than a Gladwell book (it is better than Freakonomics though)


Quotes
"Diversity and independence are important because the best collective decisions are the product of disagreement and contest, not consensus or compromise"
"It may be [...] that a good scoeity is defined more by how people treat strangers than by how they treat those they know"
"One of the real dangers that small groups face is emphasizing concensus over dissent"
"The idea of the wisdom of crowds is not that a group will always giveyou the right answer but that on average it will consistently come up with a bettter answer than any individual could provide"

Cisco mentions
- John Chambers for the abilities of a CEO
- brief moment when it had the largest market valuation ($500B market cap)

References
- Extraordinary Popular Delusions & the Madness of Crowds by Charles Mackay
- The Tipping Point by Malcolm Gladwell
- Emergence by Steven Johnson
- Smart Mobs: The Next Social Revolution by Howard Rheingold

271 pages (and 20 pages of notes)