The beauty queens in the image above, were the winners of Miss Beach World. What I didn't share during the experiment is whether red, blue, or green won, came 2nd or came 3rd. I asked the Rising Voices (around 40 people last week) to guess the order the judges selected for position 1, 2, or 3.
This is a very different task to asking who they thought was prettiest, second prettiest, or third prettiest. The distinction is important. My aim was to see whether they could anticipate what average opinion expects the average opinion to be.The judges were defined as an 'average opinion' since they could not know who they were. They were asked to think who on average would win this type of contest?
In the table below you will see the options they could choose from.
Thankfully for me - the single largest block of guesses - around 40% of the crowd, chose the right answer (see comments for right answer). They correctly second guessed the way the judges chose.
This is an example of the application of collective intelligence, swarm logic, wisdom of the crowds - or whatever else you'd like to call it. More specifically, its what the celebrated economist J.M Keynes called the Beauty Contest. Instead of the usual sort of beauty contest, where women parade in front of a panel of judges, Keynes’ version is a post-modern contest involving the full participation of the public as real competitors.
Keynes' beauty contest happens through a fictional newspaper in which entrants are asked to choose a set of six faces from photographs of women that are the "most beautiful". Those who picked the most popular face are then eligible for a prize. Indeed, if all the other competitors are also aiming to win the prize, they are also looking at the problem from the same point of view.
Keynes likened the competitors in this beauty contest to professional speculators in financial markets. Keynes argued these speculators do not really attempt to predict what an investment will yield, but instead try to stay one or two steps ahead of average opinion:- they attempt to beat the market.
This type of intelligence - the hive mind - can be harnessed for crowdsouring, predictive markets, and creating social enterprises. Businesses will need to think of smart ways of truly capitalise on the latent intelligence that is buried deep underground in their firms. Mining this intelligence from your employees, stakeholders, and target market will be a key competitive advantage going forward. This is real social media.