Crowdsourcing Decision Making In Sports

            Most people consider the Constitution of the United States as one of the foundations of modern democracy. Yet, a document starting with “We the People…” was not actually created by a wide number or variety of people. In fact, one of the most common critiques of the Constitution is that it was drafted, debated and voted on by a relatively small number of rich white males. It would seem impossible for the Constitution to be written by such a small and non-diverse group of people it were created today.

In fact, Iceland has taken an entirely different approach with its new consitution. Iceland decided to rewrite its constitution after catastrophic results to its banking and political system during the 2008 financial and economic crisis. Rather than having a Constitutional Council write a document on solely on its own, Iceland decided to take “to the Internet to raise ideas and provisions from the public. A first draft was made available online in April 2011 and citizens could comment through a Facebook page. The council also remained open about decision-making posting status updates to Twitter and videos on YouTube.” In essence, Iceland decided to crowdsource its constitution by allowing citizens to provide feedback and comments to the document. Not only did the council obtain some good ideas for revisions to the Constitution but it also allowed the citizens to “buy-in” into the document. Half of Iceland’s citizens participated in the process and two-thirds agreed that using a “crowdsourced document as the frame for the new constitution” was a good idea.

            This is maybe an interesting case study in direct democracy, but how does it apply to sports? There are two main applications of crowdsourcing to the sports industry. Sports organizations often operate as top-down organizations. This means that senior managers make decisions often with limited input for more junior employees. Using crowdsourcing techniques like collective decision markets allows employees to propose and vote on initiatives that sports organization can pursue during the course of a season or fiscal year. Because employees have buy-in (they proposed the ideas) then they are more likely to support these initiatives and have higher job satisfaction.

            Crowdsourcing and collective decision making does not have to stop for strategic initiatives typically found on the business side of a sports organization. The ultimate application of crowdsourcing concepts in sports would be to allow an organization’s different audiences (such as fans, media, sponsors, and employees) to vote on certain types of front office, coaching, and player personnel decisions. In particular, crowdsourcing can be used as component for decisions that come with predictions of future performance (such as draft picks or free agent signings).

This may seem like a completely farfetched idea. Why would any team allow people with varying degrees of expertise in sports to have input on these types of decisions? One only has to listen to a local radio sports show or read some Tweets or Facebook posts to see how bizarre some recommendations may be. In addition, organizations pay millions of dollars to general managers, coaches, scouts, and recruiters to identify and evaluate the best talent for their teams.

Yet, books like The Wisdom of Crowds by James Surowiecki and The Signal and the Noise: Why So Many Predictions Fail-but Some Don't by Nate Silver highlight scientific studies that show how using the average predictions of groups of people making independent forecasts are better predictors future performance than those of individual experts in areas ranging from economics to guessing the weight of an ox. Both Surowiecki and Silver identify two main causes of error in experts’ predictions. The first is that experts are overconfident in their predicative abilities and often overfit their models to a particular data set or not account for how new information can impact their predictions. Second, experts in fields often follow localized “herd” mentality. Rather than making independent predictions, managers will follow other managers’ behavior because it is harder to be blamed or lose your job if you are following industry standards. The book and movie Moneyball showed how difficult it was for Billy Beane to think differently. He used certain types of quantitative analyses to evaluate players that clearly would improve the Oakland A’s chances of winning games but was originally considered a pariah in Major League Baseball because no else was employing these techniques.

            This does not mean the scouting and background knowledge are not critical to the evaluation process. Silver points out that Beane has actually spent more money on scouting since Moneyball was published. It is absolutely critical to obtain as much information as possible to make informed decisions. Yet, the evidence supports that a sports organization could be better served to follow a process similar to what the Icelandic government did with its constitution. It could provide its fans, media, sponsors, and employees with opportunities to evaluate players using its information generated by the organization and allow people to vote on whom the organization should select, sign, or draft. Using this approach could allow sports organizations to avoid the two most common errors that can cause inaccurate forecasting.

            How a team uses this crowdsourcing information would have to be determined by the individual sports organization (i.e. a team would not have to sign a player because the collective decision market says this is what is should do). Yet, it would be difficult to argue that an organization’s core audiences would not be more invested in a team if it had some real or perceived ability to influence a team’s decision making process. By having this buy-in, it would make it more likely that these audience members would buy more products and service offerings like tickets, merchandise, and sponsorship because they are a part of the process. If crowdsourcing could work for something as important as writing a constitution then it could be successful for something only a little less important – deciding which general manager, coaches, and players one’s favorite team signs or hires.