Chapter Two, Part II

Generating a diverse set of possible solutions isn’t enough. The crowd also has to be able to distinguish the good solutions from the bad. We’ve already seen that groups seem to do a good job of making such distinctions. But does diversity matter to the group? In other words, once you’ve come up with a diverse set of possible solutions, does having a diverse group of decision makers make a difference?

It does, in two ways. Diversity helps because it actually adds perspectives that would otherwise be absent and because it takes away, or at least weakens, some of the destructive characteristics of group decision making. Fostering diversity is actually more important in small groups and in formal organizations than in the kinds of larger collectives—like markets or electorates—that we’ve already talked about for a simple reason: the sheer size of most markets, coupled with the fact that anyone with money can enter them (you don’t need to be admitted or hired), means that a certain level of diversity is almost guaranteed. Markets, for instance, are usually prima facie diverse because they’re made up of people with different attitudes toward risk, different time horizons, different investing styles, and different information, On teams or in organizations, by contrast, cognitive diversity needs to be actively selected, and it’s important to do so because in small groups it’s easy for a few biased individuals to exert undue influence and skew the group’s collective decision.

Scott Page is a political scientist at the University of Michigan who has done a series of intriguing experiments using computer- simulated problem-solving agents to demonstrate the positive effects of diversity. For instance, Page set up a series of groups of ten or twenty agents, with each agent endowed with a different set of skills, and had them solve a relatively sophisticated problem. Individually, some of the agents were very good at solving the problem while others were less effective. But what Page found was that a group made up of some smart agents and some not-so-smart agents almost always did better than a group made up just of smart agents. You could do as well or better by selecting a group randomly and letting it solve the problem as by spending a lot of time trying to find the smart agents and then putting them alone on the problem.

The point of Page’s experiment is that diversity is, on its own, valuable, so that the simple fact of making a group diverse makes it better at problem solving. That doesn’t mean that intelligence is irrelevant—none of the agents in the experiment were ignorant, and all the successful groups had some high-performing agents in them. But it does mean that, on the group level, intelligence alone is not enough, because intelligence alone cannot guarantee you different perspectives on a problem. in fact, Page speculates, grouping only smart people together dpesn’t work that well because the smart people (whatever that means) tend to resemble each other in what they can do. If you think about intelligence as a kind of toolbox of skills, the list of skills that are the “best” is relatively small, so that people who have them tend to be alike. This is normally a good thing, but it means that as a whole the group knows less than it otherwise might. Adding in a few people who know less, but have different skills, actually improves the group’s performance.

This seems like an eccentric conclusion, and it is. It just happens to be true. The legendary organizational theorist James G. March, in fact, put it like this: “The development of knowledge may depend on maintaining an influx of the naïve and the ignorant, and,. . competitive victory does not reliably go to the properly educated.” The reason, March suggested, is that groups that are too much alike find it harder to keep learning, because each member is bringing less and less new information to the table. Homogeneous groups are great at doing what they do well, but they become progressively less able to investigate alternatives. Or, as March has famously argued, they spend too much time exploiting and not enough time exploring Bringing new members into the organization, even if they’re less experienced and less capable, actually makes the group smarter simply because what little the new memhers do know is not redundant with what everyone else knows. As March wrote, “[The] effect does not come from the superior knowledge of the average new recruit. Recruits are, on average, less knowledgeable than the individuals they replace. The gains come from their diversity.”

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