The Wisdom of Crowds and Virtuoso Teams

The Many and the Few…

crowdsVirtuoso team2

There is a healthy creative tension between two ways of providing guidance and boosting your chances of success as you plan and execute your projects.

One is heavy on the involvement of those actually doing the work, characterized by the Value Improving Processes (VIP’s). Get those directly involved on board early, in a structured format based on statistically demonstrated success. Develop the top actions likely to benefit for your project and follow-up their implementation. Let’s explore this with reference to the influential bestseller “The Wisdom of Crowds“.

Another utilizes the collective wisdom of a select group of experts, typically not directly involved with the ongoing work, but with a track record in similar projects. These are typically referred to as “Independent Project Reviews“. A seminal Harvard Business Review article on “Virtuoso Teams” provided my phraseology.

I think that the two complement each other, and suggest most projects coordinate their complementary use. Three or four of the most relevant VIP’s up front, and IPR’s at the 30% and 70% completion points of engineering should, in my opinion, be considered.

The Wisdom of Crowds

of course, a story:

Quote (excerpts)

One day in the fall of 1906, the British scientist Francis Galton headed for the Country Fair… As he walked through the exhibition that day, Galton came across a weight-judging competition. A fat ox had been selected and members of a gathering crowd were lining up to place wagers on the (slaughtered and dressed) weight of the ox.

Eight hundred people tried their luck. They were a diverse lot. Many of them were butchers and farmers, but there were also quite a few who had no insider knowledge of cattle. “Many non-experts competed”, Galton wrote later in the scientific journal Nature.

Galton was interested in figuring out what the “average voter” was capable of because he wanted to prove that the average voter was capable of very little. When the contest was over and the prizes had been awarded, Galton borrowed the tickets from the organizers and ran a series of statistical tests on them, including the mean of the group’s guesses.

Galton undoubtedly thought that the average guess of the group would be way off the mark. After all, mix a few very smart people with some mediocre people and a lot of dumb people, and it seems like you’d end up with a dumb answer. But Galton was wrong – the crowd guessed 1,197 pounds; after it had been slaughtered and dressed the ox weighed 1,198 pounds.

Galton wrote later: “The result seems more creditable to the trustworthiness of a democratic judgment than might have been expected.” That was, to the least, an understatement.

Surowiecki

There are three types of problems described in this book:

1. Cognition Problems – are problems that have, or will have, definitive answers. What crane is best for this heavy lift and how many direct construction manhours will be expended on this project are cognition problems.

2. Coordination Problems – require members of a group (process design and procurement, construction and safety) to figure out how to coordinate their behaviors with one another, knowing that everyone else is trying to do the same.

3. Cooperation Problems – involve the challenge of getting self-interested, possibly distrustful people to work together. Owners and contractors; construction firms and unions; facility employees and the community are examples.

Nutshell:

The conditions necessary for a group to be wise: (a) independence, (b) diversity and (c) a particular kind of decentralization.

(Note: groups make bad decisions as well as good ones: think riots and stock market bubbles. There are un-wise groups, the way the world works, as well…)

bees

Example: learning from the bees, a twofold process. First, uncover the possible alternatives. Then decide among them.

Independence:

Independence is important to intelligent decision making for two reasons. First, it keeps the mistakes of people from becoming correlated. Second, independent individuals are more likely to have new information .

(In the bee hive example cited, the scout bees need to be independent in order to seek out every available source of nectar. Track record: searching within three miles of the hive, there is a greater than 50/50 chance that they will find any flower patch within a mile)

Diversity:

Diversity helps because it actually adds perspectives , and it takes away, or at least weakens, some of the destructive characteristics of group decision making. It’s a familiar truism that governments can’t, and therefore shouldn’t try to, “pick winners”…no system seems that good at picking winners in advance. What makes a system successful is its ability to recognize losers and kill them quickly.

(In the bee hive example, the forager bees follow those scout bees who bring in the most nectar and/or have the shortest path to the source and who show it in their “waggle and dance”. Other forager bees follow, preferentially, their most successful “waggling and dancing” brethren. Note: if you’ve got the waggle, you’d better have the nectar, baby!)

Decentralization:

In terms of decision making and problem solving, there are a couple of things about decentralization that really matter. It fosters, and in turns is fed by, specialization (which) tends to make people more productive and efficient. Also, the closer a person is to a problem, the more likely he or she is to have a solution for it.

Decentralizations great strength is that it encourages independence and specialization. Its great weakness is that there is no guarantee that information uncovered in one part of the system will find its way to the rest.

Random Quotes:

A survey found that physicians, nurses, lawyers, engineers, entrepreneurs, and investment bankers all believed they knew more than they really did. It wasn’t just that they were wrong, they didn’t have any idea how wrong they were. The only forecasters whose judgments were routinely well calibrated were expert bridge players and weatherman.

Herders may think they want to be right, and perhaps they do. But for the most part, they are following the herd because that’s where it’s safest. John Maynard Keyes wrote in The General Theory of Employment, Interest and Money, “Wordly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally”.

Virtuoso Teams

I have worked (on and off) for several years for Pathfinder, LLC – attracted there in large part because of the ways its founder and president, Lou Cabano, fosters and gets the most out of virtuoso teams. Something “magic” happens when small groups of really smart people, relying on well-honed “chunks” of knowledge, wisdom and experience, “go at it” to solve the tough ones.

Virtuoso Teams Cover

The HBR article here and here popularized the phrase “virtuoso teams”, which I like, but the full article is not 100% applicable to Independent Project Review Teams.

Here is an sample, however, of a “virtuoso attitude” to consider adopting during such a study period:

Traditional teams: Focus on tasks; complete critical tasks on time; complete the project on time.

Virtuoso Teams: Focus on Ideas; a frequent and rich flow of ideas between team members; they strive to find and express the breakthrough idea on time.

Related Thought

Consider the entrepreneurial small business start-up (in a way, every new project begins sort of like that). If the hypothetical small business team is really good at 46 of the 50 key essentials to success, they may eventually struggle in those deficient areas. The “independent” in Independent Project Review team infers freedom from some self-selection / interest and skills bias that the base project (perhaps the company) may display. Therefore, the IPR team may be especially well suited to spot such potential deficiencies, and have some ideas about how to bolster the project team to overcome them.

One Comment

  1. Posted March 26, 2008 at 2:44 am | Permalink

    well done, man

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