Another book that I like to recommend to entrepreneurs and existing small business owners is The Wisdom of Crowds by James Surowiecki, a columnist for The New Yorker magazine.
It was published in May 2004 and has 320 pages.
The subtitle is: “Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations.”
That’s quite a mouthful and suggests that there really is wisdom, influence, and, in particular, power in the thinking and opinions of the masses, either to the benefit or detriment of every society, organization, and economy in the world.
The author believes that if some basic conditions are present, the masses have the capability to produce better outcomes than a selected group of experts.
In fact, the crowd doesn’t even have to know all the facts and some individuals don’t even have to act rationally.
Surowiecki argues that “wise crowds” show the following characteristics:
(1) Diversity of opinion;
(2) Independence of members from one another;
(3) Decentralization; and
(4) A good method for aggregating opinions.
The implications of the author’s premise is that crowds are better than individual experts at predicting the future, solving certain types of problems, coming to good and relevant decisions, and assessing the usefulness of products and services.
How does that affect your thinking about who your perfect business customer might be?
Who do you trust to give you important feedback about your business and products?
I found The Wisdom of Crowds both fun to read and quite down-to-earth in its presentation of real-life examples and stories; yet it challenged my thinking intellectually and stimulated my thought process related to small business marketing and selling.
In fact, I remember reading the book in just a couple of days.
I had a hard time letting go as the author pulled me into his persuasive arguments and justifications for his beliefs.
One of the important ideas I took away from this book was the notion that small businesses need a “think tank” or mentoring group to help them make good decisions about their business and its execution.
Diversity of management styles, opinions, and experience adds perspectives to a business owner’s thought processes and beliefs.
This diversity is absent in a solo business owner by himself/herself.
A management team or mentoring group, in theory at least, would tend to make better business decisions and would be better at solving problems.
This notion doesn’t necessarily mean that solo business is not a good model or can’t make proper decisions – but maybe the owner needs some help or others involved as a sounding board.
It would be a burden for the owner to have to consult a group before every action he took.
The author, Surowiecki, also found that grouping only smart people together was not a good idea because they tend to resemble one another in skills.
A group would be better served by having a diversity of people who knew less but have different skills to offer.
So as you head into solo business, consider organizing a diverse group of people who can help you come up with better decisions than you would make on your own, at least for the important issues.
I am wondering if having a feedback group of customers might be an excellent way of getting a diverse group together that can give you feedback on your site, your products, your marketing, product pricing, etc?
It’s certainly worth your consideration.
To your online business success,