Democracy outside of Politics
A number of months ago I read an article in the German economics magazine “Brand Eins” called “Schlaue Menge” (Intelligent Quantity). It detailed examples in which the average of educated guesses were better than as much a 98 percent of the individual guesses. It detailed examples from the American sociologist, Kate Gordans, guessing the relative weight of a number of different objects to the US-Navy’s method by which they found a lost submarine.
In the New York Times last week was another example from Rite-Solutions, a software company that builds systems for the US-Navy. They have created an Ideas Exchange. Like in stock exchanges the ideas gain backing from employees and rise to the top with increasing support. With the same principle also implemented by google Amazon Alexa and others, the average of the masses prove to be more accurate than any one member. This not only enables ideas to rise from place where they would not otherwise get a chance, it also provides a wonderful democratic valuations system. This takes pressure off management and provides them with support in risky decisions. In one case the management was sceptical in realising one product idea coming out of the exchange, but it now accounts for 30% of sales.
