BLT: KyteMark presentation – The Wisdom of Crowds

‘Research’ could be just seen as another word for ‘Listening’, but it can be so much more than that….In the last BLT meeting of the year, KyteMark Solutions illustrated the bottom line value that its research products generate.

David Milnes of KyteMark Solutions presented a selection of Case Studies detailing how research had worked in practice for a selection of KyteMark’s clients, notably:

• Auditel – a Twickenham-based cost management company – corrected a major flaw in its report presentation to the schools sector and as a result, secured an invitation to the Annual Bursar’s Conference
• Pentangle – a Thames-based IT company – as a result of the research findings, altered its strategy and landed a new £30k order from an existing customer. Click here for the Case Study
• Chiltern Relocation – an executive relocation company – undertook the Customer Pathfinder and uncovered a new networking group just for relocation agents of FTSE100 companies. Click here for the Case Study.
  

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Then, as it was Christmas time, a little game for the group to try to convey the value of research….which, erm, didn’t work out quite as intended!

The theory

Aristotle was credited as the first person to write about the ‘Wisdom of the crowd’, in his work titled ‘Politics’. 

Put simply, given a large enough sample size, the ‘crowd’s’ guesses  should form a probability distribution curve, with the median guess falling close to the right result.

Statistician, Francis Galton was the first to test this in the UK back in 1906 at a country fair in Plymouth when 800 people estimated the weight of a slaughtered ox, with the median guess of 1,207 pounds proving to be accurate to within 1% of true weight.

In practice

We carried out a variation on this experiment at Thursday’s BLT group.

• 1st round: each person had to guess the number of sweets in a tin of Quality Streets (other brands are available!) and write this down on a piece of paper
  • They could then either stick with this guess, or pay 50p to see another persons’ guess
• 2nd round: armed with the ‘new information’, those who had paid for ‘research’ could guess again.

Results

• 6 out of 10 people bought research
• However, this only moved the mean 0.5pp closer to the actual result!

What we should have done…..

• Provided those who paid 50p with the average guess – this would have constituted ‘Basic Research’
• Provided those who paid £1 with the average guess adjusted for random outliers (e.g. these ‘way out guesses’ – say over 200% wrong – would balance out in a larger sample size) – this would have constituted ‘Advanced Research’

Reasons for not buying ‘research’

• There were no ‘experts’ present with better knowledge [however, had we offered the ‘average guess’ this would have been far more enticing]

Where research has worked in the past for the BLT group

• Pooled knowledge – when launching a new business venture, a focus group made up of peers offered critical feedback & advice
• Feedback loops – when a product had been launched, research into customer feedback enabled modifications to be made
  

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BLT Group news

• Edward Briscoe: Presentation on wills and planning to Henley Business Partnership, at Coq au Vin in Henley, Fri 16th Dec, 8pm
• Helen Isacke: the online Trusted Coach Directory is now live!