6. The Best Decision Makers

Studies regarding the best decision makers

It's common sense that we would want the most "intelligent" decision makers for our new governing process. But what does that mean?

Many studies have been performed and books written comparing the decision ability of individuals, small groups, and large groups of people. Group intelligence is often referred to as "collective intelligence." Unfortunately, every industry from business to psychology to science has a unique definition and use for the term "collective intelligence." Because so many definitions of individual and group intelligence exist, most studies and scholarly articles comparing individual intelligence and collective intelligence do not apply to our situation.

For example, collective intelligence has been defined and studied in business as the ability of large numbers of people to co-create a product such as Wikipedia. Collective design such as open-source software is referred to as collective intelligence. In science and medicine, collaborating through the sharing of information, knowledge, and experimental processes in scientific and professional journals is called collective intelligence. The term also represents the capabilities of small teams in business. Sometimes mass influence and crowd psychology are referred to as collective intelligence (or the lack thereof), such as the effects on societies from social media and mob rule.

Consequently, the results and conclusions of studies on collective intelligence compared to individual intelligence vary widely based on the context. Not only do the definition and the field of application differ by study, but a study's objectives, group sizes, and the processes used to judge the results vary widely also.

A useful definition of intelligence for making decisions

In our case, our purpose is not a broad comparison between the abilities of individuals, small groups, and large groups in all fields. Our objective is to determine if, how, and under what circumstances each of these three types of rulers could exercise the best judgment in national governing decisions resulting in the most benefits for all citizens. Therefore, in our context "intelligence" is not being smart, having a high IQ, knowing information, or being a good leader. Rather, we define "intelligence" for our purposes as "exercising the best judgement when solving a complex, governance issue."

Fortunately, some studies in collective intelligence focus on this very area, comparing the abilities of groups to individuals for making effective judgements in our context. From these studies, we learn that whether an individual expert, a small group, or a large group is best at making national governing-type decisions does not depend on the experience, IQ, or expertise of the individual or of individuals in the groups. Surprisingly, it depends on the following four factors.

  1. The type of decision being made

  2. The composition of the group

  3. What motivates those in the group to participate

  4. The process used to make the decision

1. The type of decision being made

All types of governing decisions exist in government ranging from the simple to the complex. Examples of simple administrative decisions are supplier selection, personnel coordination, hiring, and the execution of operations. Complex governing decisions include choosing the best solution and funding for societal problems that affect everyone.

Intelligence of large groups such as the citizenry

In his book The Wisdom of Crowds, James Surowiecki explains that large groups of people make better decisions for certain types of problems. [3]

If you put together a big enough and diverse enough group of people and ask them to make decisions affecting matters of general interest, that group’s decisions will, over time, be intellectually superior to the isolated individual, no matter how smart or well informed he is.

The three types of problems at which large groups excel over small groups and individuals according to Surowiecki are cognition problems, coordination problems, and cooperation problems. Cooperation problems describe the type of governing decision problems that we are interested in. Surowiecki explains them like this. [4]

Cooperation problems involve the challenge of getting self-interested, distrustful people to work together, even when narrow self-interest would seem to dictate that no individual should take part. Paying taxes, dealing with pollution, and agreeing on definitions of what counts as reasonable pay are all examples of cooperation problems.

In complex cooperation problems, groups consistently make better decisions than the smartest expert in the group does, even with groups of professionals. Not only that, but large groups perform far better than both small groups and individuals. One article on measuring collective intelligence posited why as follows. [5]

People tend to form groups when they have to solve difficult problems because groups seem to have better problem-solving capabilities than individuals. Indeed, during their evolution, human beings learned that cooperation is frequently an optimal strategy to solve hard problems both quickly and accurately. The ability of a group to determine a solution to a given problem, once group members alone cannot, has been called "Collective Intelligence." Such emergent property of the group as a whole is the result of a complex interaction between many factors.

Intelligence of small groups such as teams or councils

When focused on decisions within a narrow domain such as the management of an organization, small groups are more practical than large groups. Small groups can meet face to face, spend more time in discussion and brainstorming, and more easily share detailed information. Therefore, a small team that can easily schedule time to meet would be better than a large group or an individual for managing a government department.

Small groups can focus full time on specific issues and projects. Small group members can divide their labor on different tasks while conferring together on important decisions. The oversight of the other team members motivates everyone to be more engaged, to work harder, and to contribute more.

Small groups outdo individuals because they bring together different information, perspectives, skills, and experience resulting in the whole being better than the sum of the parts. If there are 10 people in the group, then there are 9 additional opportunities for a breakthrough idea than for an individual alone. The interesting part is that it is not always the same person with the best idea for a solution. Everyone in the group contributes a breakthrough idea over time. This is one demonstration that even small group performance does not depend on the individual in the group with the most experience, the highest IQ, or the most expertise.

A small group can make better decisions than each member would make as individuals, as long as everyone is not overly influenced by the strongest personality in the group or overly controlled by the head of the group. A good example is a jury. A jury is preferred over a judge for critical verdicts and a legislature is preferred over a president or a dictator. The larger the group and the more diverse the opinions, the better the decisions of the group will be.

However, when a small group has one mind (called groupthink) or its judgement is controlled by a superior, the group is no better than the best individual in the group or than the manager who dictates the solution.

Teams with no power that are organized solely to provide input usually are not more than their parts and often mirror back what is expected. Some teams are just a resource pool to allocate the work. These disadvantages may apply to legislatures and committees when they simply comply with the demands of the majority political party through the Senate majority leader, the Speaker of the House, or the chairperson of their committee.

Individual intelligence

Individuals are best at executing work procedures, at actually doing the work of detailed, focused tasks rather than making governing decisions that affect many people. An individual expert may be best at creative tasks such as writing music and inventing completely new products or processes.

However, individuals rarely make unilateral decisions or invent in a vacuum without review and input by others on their team or from outside their team. For example, a simple new law may be written by an individual, but it would always be reviewed by others with different skills, perspectives, and experience before leaving the committee. Almost all governing decisions require input from others.

Even in creative tasks, teams are often more productive. For example, open-source software benefits from the creative ideas of hundreds or thousands of programmers, not the single best programmer. The best TV series are written by teams of writers. An inventor may work alone, but the objective is to produce a prototype quickly to allow input from many other people. The inventor's best ideas are often quickly improved and eclipsed by ideas from reviewers and customers. The reviewers' ideas, critiques, and observations are part of the inventor's creative process. Customers (a large group) provide the essential information describing their problem or needs. Together they all form a product development group. Even a non-fiction author writing a book as an individual usually draws on the works of hundreds of other people bringing together their collective intelligence. Non-fiction writers normally review their ideas and logic flow with others to ensure the writing communicates effectively and that the writer's premise is sound.

Individual over-confidence

The problem with individuals is that they commonly judge their opinion as correct over that of everyone else. Consequently, a President, CEO, or general might ignore the consensus of his entire team of advisors. This applies to men more than to women in my experience. Men are overly confident that they are right and enjoy making command and control decisions and being in charge. They often feel entitled to be right and to make the decision. Those at the top are sometimes the worst at jumping to conclusions and immediate solutions.

Women, however, tend to want confirmation from others that a decision or a solution is good. They look more for group consensus. That may be why two studies with 699 people concluded that while the collective intelligence of groups does not depend on the average or maximum individual intelligence, it "is correlated with the average social sensitivity of group members… and the proportion of females in the group." [6]

James Surowiecki described individual decisions versus small group decisions as quoted below. He concludes that extremists are the worst decision makers and they drive group polarization, yet we trust them the most. [7]

People who imagine themselves as leaders will often overestimate their own knowledge and project an air of confidence and expertise that is unjustified. And since, as political scientists Brock Blomberg and Joseph Harrington suggest, extremists tend to be more rigid and more convinced of their own rightness than moderates, discussion tends to pull groups away from the middle. Of course, sometimes truth lies at the extreme. And if the people who spoke first and most often were consistently the people with the best information or the keenest analysis, then polarization might not be much of a problem. But it is.

THE OBVIOUS TEMPTATION IS to do away with or at least minimize the role that small groups play in shaping policy or making decisions. Better to entrust one reliable person—who at least we know will not become more extreme in his views—with responsibility than trust a group of ten or twelve people who at any moment, it seems, may suddenly decide to run off a cliff. It would be a mistake to succumb to that temptation. First of all, groups can be, as it were, depolarized. In a study that divided people into groups of six while making sure that each group composed two smaller groups of three who had strongly opposed views, it was found that discussion moved the groups from the extremes and toward each other. That same study found that as groups became less polarized, they also became more accurate when they were tested on matters of fact.

More important, as solid as the evidence demonstrating group polarization is, so too is the evidence demonstrating that nonpolarized groups consistently make better decisions and come up with better answers than most of their members, and surprisingly often the group outperforms even its best member. What makes this surprising is that one would think that in a small group, one or two confused people could skew the group’s collective verdict in the wrong direction. (The small group can’t, in that sense, rely on errors canceling themselves out [as with a large group].) But there’s little evidence of that happening.

Judging what is "good" or "right" or "the best"

The problem with evaluating individuals and groups of any size regarding solutions to complex problems is determining how to judge which decisions are the best. Not only do the different experiments and studies in collective intelligence occur in different fields for different purposes, but also those conducting the experiments decide what indicates one solution is better than another is. "Goodness" is often subjective for large, complex, cooperative-type issues. Typically, a solution is deemed as good if it benefits the owner the most and aligns with the owner's beliefs or ideology.

As we saw in the examples in the last chapter, politicians often disagree with and scuttle solutions from the people when the desires of the people conflict with the desires of the politicians. I'm guessing that the political party controlling the politicians saw themselves as the owners of government and the solutions did not fit their agenda. Any control by the people scares political representatives because it challenges their supremacy and raises the legitimate question of whether representation is still the best governing process for citizens today.

Based on the first factor, the type of decision being made, we can conclude that large groups of citizens would consistently make the best judgements and find the best governing solutions rather than individuals or small groups.

2. The composition of the group

The second factor that determines if a group is the best decision maker is the composition of the group. Under the right conditions, very large groups are remarkably intelligent and make better decisions than those made by the smartest people or sub groups in them. Regarding large, complex, societal issues, the following conditions are needed for optimum results. [8]

  • A single issue or challenge is addressed at a time.

  • The group is large with enough participants to represent suitably the citizen population affected by the issue.

  • The group members are allowed dissenting viewpoints, including extreme positions.

  • The group has a broad diversity of ideas, prejudices, opinions, and beliefs.

  • The group is decentralized, possessing a wide diversity of special and local knowledge.

Based on these criteria, large groups of citizens would have the optimal composition to make the best judgements for our governing solution process.

3. What motivates those involved to participate

The motivation of those who participate is the third important factor for determining the best decision makers. The motivation depends on the importance of the decision and the potential rewards. For individuals and small groups, the purpose may be monetary; they are paid to do their job. Personal financial reward and self-interest are primary motivators, although these simplistic answers are not sufficient to explain all motivating factors. Self-interest can include rewards such as personal satisfaction from a feeling that the results are important, enjoyment from participating, recognition from others, and a greater hope for the future.

Regarding voting or participating in national decisions on large, complex societal issues where no immediate financial reward exists, studies have shown that the motivating factors are a sense of duty, a personal belief in doing the right thing, and a desire to have a voice in the outcome however small that voice may be. [9] Issues that affect the survival or future of a person's family and country could provide the most motivation of all, which might be what gives nationalism its power.

Would apathy motivate them to avoid participating?

Despite the studies confirming a desire to participate, a common opinion that I run into is the belief that people would not participate in a democratic process. Supposedly, they do not have the time nor the interest and they are generally apathetic. While this is a common belief, especially in a republic where your vote means very little in national elections, it is an over generality that is not universally true. The historical evidence is that people participate when the solution to a specific issue is important to them and when they feel their contribution adds value. The more their voice is heard, the more they participate and the less they complain, whether or not every result is exactly what they personally wanted.

From the examples in the last chapter, people were highly motivated to participate and not apathetic regarding participatory budgeting, as long as their participation contributed and the resulting projects were funded. And in Switzerland, 45% of the people vote every quarter and 75% vote at least once every four years on those issues that are important to them.

Why people do not vote in the US

We don't have any democratic processes at a federal level in the US that allow people to participate. The common belief in apathy comes from the media commenting on voting turnout percentages. If enough citizens do not participate in our new process, it will not be viable. Therefore, voter turnout is worth considering.

The voter turnout for the 2020 Presidential election was a record breaker. About 2 out of 3 or 66% of the people who were eligible voted. [10] Whereas, about 3 out of 4 or 75% of eligible voters in Switzerland participate. Two US voter surveys and the US Census Bureau report the top reasons why a third of the people don't vote. [11]

  • I dislike politics

  • Voting has little to do with the way decisions are made

  • My vote won't affect the results

  • I don't like any of the candidates

  • I don't feel informed enough to participate

The top four answers essentially say, "Voting is a waste of my time because it doesn't contribute to fixing anything." That is the real cause of apathy. Interestingly, not feeling informed enough to vote is a major reason for non-voting in Switzerland as well. In case you were wondering, in the US the non-voters were evenly split between Democrats and Republicans.

The minimum number of participants needed

If the people made the governing decisions, perhaps more people would participate. However, neither republics nor democracies rely on 100% participation. The common belief regarding a truly democratic solution process is that 100% of the public must be involved in a solution for it to be legitimate. However, that's wrong. All that is important is that enough citizens participate who care about the solution of an issue to represent adequately the citizen population affected by it.

From real-world examples with democratic processes, our premise is that people spend time on what is important to them. People who feel a solution to an issue is important will participate. Participation will be rewarding, which will encourage further participation. Those who are interested will promote the issue to others.

Those who do not care about the outcome of a specific issue sufficiently to participate should not participate in that issue. The solution of that issue should be left to those who do care, are willing to become informed, and are willing to spend the time to participate. Currently, we are ruled by a small group of legislators, individual department executives, and the President who answer more to their political party and the elite and special interests than to the people. In a democratic solution process, the people would be led by a very large group of interested citizens who care about the people first and are willing to participate in the decision. Based on the third factor of motivation, sufficiently large groups of citizens should be motivated to participate in solving those issues that are important to them. If an issue were not important enough to attract interest from a large enough group of participants, then it should be ignored until sufficient people expressed their interest.

4. The process used to make the decision

The fourth factor in achieving the best decisions and solutions is the process used. Deciding the outcome by a majority vote that simply collects the biased opinions of citizens is an inadequate process. Even though the studies show that such a process for a large group consistently yields better decisions than for a small group or for an individual, for our purposes a simple opinion vote is not sufficient. Simple voting is the weakest part of current democratic decision processes such as citizens' initiatives. We can do much better.

Our design for our new governing solution process that scales nationally is explained in the next chapter. For our new solution process, large groups of citizens would be the best decision makers.

 

Key takeaway: By all four criteria, large groups of citizens would be the best rulers through a truly democratic governing solution process that goes beyond mere voting.

 


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