Harnessing Collective Wisdom From Communication Patterns in Human Organizations

• In Event: ICA Interactive Paper/Poster Session I
  In Interactive Poster Session: Computational Methods Interactive Poster Session

Abstract

The collective intelligence hypothesis purports that groups can be smarter than individuals in a wide range of decision-making problems. Attempts to tap the cognitive surplus of collectives have enhanced innovation, product design, and predictions about the replicability of scientific findings. A similarly important task is to improve organizational decision-making in financial investment firms. Financial companies invest public and private resources and thus their returns fundamentally affect retirement funds and planning, corporate earnings, and economic growth. Despite the far-reaching implications of good organizational decisions, the question about how communication dynamics within companies can result in collective intelligence requires further investigation. Can different patterns of communication or changes in the content of communication over the course of decisions be used to improve decisions? In this study, we show that collective intelligence signals deduced from communication patterns predict the movement of the market. Further, we find that the firm does not take advantage of the produced collective intelligence and that it could make superior decisions using communication-based collective intelligence signals.

Authors

• Agnes Horvat, Northwestern University

• Daniel Romero, U of Michigan

• Brian Uzzi, Northwestern U