Most people don’t know what Google’s PageRank really means. It’s not a ranking of website pages, it’s named for Google co-founder Larry Page because he devised the initial algorithm to rank a website’s importance. While the formula is a closely guarded secret, it’s commonly understood that the genius of PageRank is how it uses the “wisdom of crowds” to distinguish the value of two search results. Simply put, the more sites that link to you, the more likely you are to improve your PageRank. The quantity and quality of links improves PageRank. Better that The New York Times link to your most recent post than your mother’s chocolate chip cookie blog.
The wisdom of crowds implies that on balance the crowd can solve problems better than any single individual. Our purchasing decisions have changed as a result of this insight powering many new organizations. Without the wisdom of crowds, there is no TripAdvisor, Yelp, or Amazon. Consider that before Amazon, nobody knew that people who bought that Discraft frisbee also frequently purchased that Yeti thermos.
So we know the wisdom of crowds plays a big role in determining search results and influencing purchasing decisions. But what if that measurable wisdom could improve organizational outcomes? What if we knew what the best nurses, teachers, and police officers do and could use that information to better train and measure future employees?
Here’s an example. As part of my job, I spend a lot of time with restaurants and food manufacturers. 100% of their employees carry smartphones and 95% of them cannot use them to improve their companies. There’s a reason those of you reading this post use work apps on your phone. It makes you more efficient and better at your job.
While food companies could use their employees’ phones to distribute content and information, run protocols, and create schedules, most prefer paper for restaurant operations. According to CoInspect research, 93% of America’s largest 300 restaurant chains use some version of paper and pencil for operational line checks. This paper is then filed for (on average) 3 years and never structured into data that could have an impact on operating margins. Still another 75% don’t have multimedia training available on mobile devices. Domino’s lovers can order a pizza from their phones, but the guy who makes it checks the oven temperature and writes it down on a clipboard with a pencil.
I know the top reasons cited for food companies to keep employees from using their phones at work.
- We don’t want to pay for their data. (Are you sure you have to?)
- We don’t want them distracted by their phones. (But you do want them to use your intranet to learn best practices. You do want them accessing your training content.)
- It’s a regulatory issue. (Is it? Do you think it’s better to have paper, pens and clipboards lying around?)
Distributed restaurant chains vary widely in their operational performance. Many factors create the disparity including location and geography. But most restaurant CEOs point to operating rigor as the primary reason for a given location’s success.
The best stores have the cleanest bathrooms and neatest parking lots. The best stores have air conditioners that never fail and serve their food at the same temperature every time. That’s because the best stores already use the wisdom of crowds in their culture. They collaborate, train, and cooperate better than other stores. But it’s neither captured nor measured.
Back at the home of PageRank, Google works tirelessly to optimize their operational performance based on structuring the wisdom of crowds, or in this case, their employees. Recruiting procedures are improved based on the data collected from participants. Office furniture gets rethought in light of user feedback. Even the chefs at Google, artists in their own right, get the wisdom of eaters.
Collaborative operators will outperform hierarchical operators going forward. That’s because the collaborative, data driven executives will take advantage of their employees’ computing power and their wisdom to continuously improve.