Editor’s Note: In another interesting post from our European Union Edition, Tom Moore talks about the effect that the herd mentality has on the tendering process.
One of the most interesting phenomena of social science is the power of group decision making. Social science has few well evidenced and proven laws, but the ‘wisdom of crowds’ is one of the few. This relies on the principle that multiple people generally make better decisions collectively than one person. This phenomenon is present throughout societies, with democracy being the obvious example. Undeniably being the most optimal form of government that humans have invented, democracies harness the power of group decisions and are self-correcting mechanisms.
Other examples include stock markets, where millions of individual transactions create incredible, responsive pricing of successes and failures, risks and events. It is no surprise then that good procurement practice exploits the wisdom of crowds by having panels of scorers. These panels assess tenders through multiple viewpoints, rather than one fallible individual making judgement. The mechanics of how this works are typical as follows:
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