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Collective Intelligence:

How smart can your organization be

Thomas W. Malone

MIT

Copyright © 2007 Thomas W. Malone. All rights reserved.


Outline

• What is collective intelligence

• How can you increase your organization’s

collective intelligence

– Focus on specific problems

– Collect the right people and computers

– Connect them in the right ways

• What’s s coming

Copyright © 2007 Thomas W. Malone. All rights reserved.


What is collective intelligence

Collective intelligence –

Groups of individuals doing things

collectively that seem intelligent

Copyright © 2007 Thomas W. Malone. All rights reserved.


Examples of collective intelligence

• Google

• Wikipedia

• eBay

• …

Copyright © 2007 Thomas W. Malone. All rights reserved.


The Question

How can people and computers

be connected so that

—collectively—

they act more intelligently

than any person, group, or computer

has ever done before

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you increase your

organization’s s collective intelligence

• Focus on a problem for which you want

intelligent solutions

• Collect the right people and computers

• Connect them in the right ways

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you increase your

organization’s s collective intelligence

• Focus on a problem for which you want

intelligent solutions

• Collect the right people and computers

• Connect them in the right ways

Copyright © 2007 Thomas W. Malone. All rights reserved.


• Not

• But

Focus on a specific problem for

which you want intelligent solutions

– How can we manage knowledge

– How can we encourage collaboration

– How can we design better products

– How can we manage our supply chain more efficiently

– How can we sell more effectively

Copyright © 2007 Thomas W. Malone. All rights reserved.


A thought experiment…

• Imagine a super-human intelligence that

– knows everything that is known (or knowable) by all the people and

computers in your organization

– has unlimited time and abilities to reason about these things

• How would it solve the problem on which you’re

focusing

• And how close can you come to this imaginary ideal

with real people and computers

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you increase your

organization’s s collective intelligence

• Focus on a problem for which you want

intelligent solutions

• Collect the right people and computers

• Connect them in the right ways

Copyright © 2007 Thomas W. Malone. All rights reserved.


InnoCentive

• Companies post scientific problems on website

– E.g., how to synthesize a certain chemical compound

• Over 100,000 scientists worldwide available to solve

problems

– Retired scientists, professors, students, contract research orgs, …

• Successful solutions get awards up to $100,000 or

more

Copyright © 2007 Thomas W. Malone. All rights reserved.


Rite-Solutions

• Software company specializing in military

applications

• Has internal “stock market” for ideas about new

products or business improvements.

• All employees can buy, sell, or volunteer to help with

an idea. Volunteers share in financial rewards if idea

is actually implemented.

• Results: Successful new products that would never

have been implemented otherwise.

Copyright © 2007 Thomas W. Malone. All rights reserved.


NASA clickworkers

• Identifying craters on Mars is time-consuming,

tedious, but necessary work for planetary scientists

• NASA created a website where public volunteers

could do this by clicking on Mars photos

• Results: 80,000 volunteers participated. 2 M craters

classified. Averaged results as good as classifications

by expert scientists.

Copyright © 2007 Thomas W. Malone. All rights reserved.


The ESP Game

• Computers have difficulty recognizing most images

• Game:

– Pairs of random players on the web see the same image.

– Each tries to type words that match the words the other player is typing.

– When they match, both players get points.

– Players’ goal: get as many matches as possible in 2.5 minutes.

• System gets labels for thousands of images (for free).

– As of July 2006: 75,000 players, 15,000 agreements. Some people play 20 hr/wk.

• Developed by Luis Van Ahn (Carnegie Mellon)

Copyright © 2007 Thomas W. Malone. All rights reserved.


TopCoder

• Software development firm with over 95,000

registered freelance programmers from all over the

world.

• For each programming task, freelance programmers

compete to do task (design, coding, integration,

testing).

• Best versions win prize money.

• Some programmers from low wage countries have

already made over $100,000.

Copyright © 2007 Thomas W. Malone. All rights reserved.


Writing a business book

Wikipedia-style

• Working title: “We Are Smarter Than Me”

• Joint project: MIT Sloan, Wharton, Pearson

Publishing

• Over 4,000 people registered so far

• Goal: Hardback book published by Pearson

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you collect the right people

and computers

• Include more people

– outside your organization

– inside your organization

• Increase the diversity of information and skills relevant to

solving the problem

– Include non-experts

• Let computers do things that can be automated and let

people do things that can’t

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you collect the right people

and computers (cont.)

• Motivate people to participate

– This is probably the single biggest source of collective intelligence

failures.

– Contests

– Fun

– Money

– Recognition

– Community

– Sense of meaning

– …

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you increase your

organization’s s collective intelligence

• Focus on a problem for which you want

intelligent solutions

• Collect the right people and computers

• Connect them in the right ways

Copyright © 2007 Thomas W. Malone. All rights reserved.


The problem

• When people just talk in groups, they often fail to

effectively use lots of information and skills in the

group (“groupthink(

groupthink”, “mob psychology”):

– Early speakers have a disproportionate influence on outcomes.

– Power and status of some people discourages others from saying

what they actually think (or know).

– Information known to only a few members of a group has less

influence than information known to all members.

– Biases are often amplified by a group discussions.

– Shared responsibility may decrease motivation for individuals to

contribute.

Copyright © 2007 Thomas W. Malone. All rights reserved.


IBM Jams

• On-line brainstorming sessions, typically 72 hours

long, with up to 150,000 employees, clients, partners

• Topics: management best practices, IBM values,

innovation

• Recent Innovation Jam: 46,000 ideas including

“green” innovations, intelligent utility networks,

branchless banking for developing world

• CEO Palmisano to invest $100M for 10 best

Copyright © 2007 Thomas W. Malone. All rights reserved.


HP’s prediction markets

• Goal: Predict future sales of HP printers

• Approach: Participants buy and sell predictions of

future sales

– E.g., Buy a “share” predicting sales in Sept.

between 1501 and 1600 units

» If correct: get $1

» If wrong: get $0

Copyright © 2007 Thomas W. Malone. All rights reserved.


HP’s prediction markets (cont.)

• Participants were mostly from HP sales force

• 10 sales ranges

• Each person starts with 20 shares

• Market open for several days.

• Result: Better predictions than official HP sales

forecasts

Copyright © 2007 Thomas W. Malone. All rights reserved.


Other prediction markets

• Google – no. of users for current products, launch

dates for new products

• Microsoft – release dates of products and internal

tools

• Others – Eli Lilly drug testing, US Presidential

elections, movie revenues, technological progress, . . .

Copyright © 2007 Thomas W. Malone. All rights reserved.


Kasparov vs. the World

• Players:

– Gary Kasparov, world chess champion, 1999

– vs. the rest of the world (with on-line discussions,

suggestions by 5 well-known chess experts, and

moves decided by majority vote)

– Kasparov heavy favorite before play began.

• Result: Kasparov won after 62 moves in 4 months.

• He said it was the hardest game he ever played.

Copyright © 2007 Thomas W. Malone. All rights reserved.


Two components of intelligence

• Generating possible solutions

– Designing a new product

– Designing a new strategy

– …

• Evaluating (and selecting) solutions

– Deciding which of several products (or strategies) to launch

– Deciding which job candidate to hire

– …

Copyright © 2007 Thomas W. Malone. All rights reserved.


How can you connect people and

computers in the right way

• For generating possible solutions

– If people can generate complete solutions by themselves, then

» Find ways of collecting ideas from lots of people

– If individuals can’t t generate a complete solution, then

» Find ways of managing the interdependencies

• Wikipedia discussion pages

• Wikis and collaboration tools, in general

• Simulations…

Copyright © 2007 Thomas W. Malone. All rights reserved.


Connect people and computers in the

right way (cont.)

• For evaluating possible solutions

– Find ways of combining judgments from large groups that

avoid the common biases of groups

» Markets

» Voting

» Statistical techniques

• Averaging

• Weighted averaging

• Bayesian Truth Serum

» Structured argumentation

» Unstructured discussion (but beware of biases)

Copyright © 2007 Thomas W. Malone. All rights reserved.


What´s coming

Copyright © 2006 Thomas W. Malone. All rights reserved.


Collective planning

• Goal: Groups collectively propose and analyze plans

• People input issues, positions, arguments (pro & con).

Positions linked to simulation components.

• Simulations show results of different combinations of

positions.

• Examples: Global climate change, business planning

Copyright © 2007 Thomas W. Malone. All rights reserved.


Collective prediction

• Goal: Combine people and computers to make best

possible predictions

• Combine: Predictions markets, statistical forecasting,

machine learning

• System does routine work, people make corrections

when appropriate, system learns from experience.

• Examples: Sales forecasts, competitor actions

Copyright © 2007 Thomas W. Malone. All rights reserved.


Question

• How decentralized can we be

Copyright © 2007 Thomas W. Malone. All rights reserved.


Video courtesy of

Cinematrix

Interactive Entertainment Systems, Inc.

www.cinematrix.com

Copyright © 2006 Thomas W. Malone. All rights reserved.


What´s coming

Copyright © 2007 Thomas W. Malone. All rights reserved.


What´s coming

Copyright © 2007 Thomas W. Malone. All rights reserved.


What´s coming

There is only one time in the history of each planet

when its inhabitants first wire up its innumerable

parts to make one large Machine. …

You and I are alive at this moment.…

--Kevin Kelly, “We

Are the Web,” Wired, , 2005.

Copyright © 2007 Thomas W. Malone. All rights reserved.


What´s coming (cont.)

[H]ere

at the cusp of the third millenium…

humans began animating inert objects with tiny

slivers of intelligence, connecting them into a

global field, and linking their own minds into a

single thing. . . . .

--Kevin Kelly, “We

Are the Web,” Wired, , 2005.

Copyright © 2007 Thomas W. Malone. All rights reserved.


What´s coming (cont.)

[Three

thousand years from now,]

this will be

recognized as the largest, most complex, and most

surprising event on the planet. . . . .

It was the Beginning.

--Kevin Kelly, “We

Are the Web,” Wired, , 2005.

Copyright © 2007 Thomas W. Malone. All rights reserved.

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