Effective decision-making structures like majority voting reduce noise, but they can also result in organizations competing for the same high-quality targets, diluting profits. We examine minority ruling, which champions the minority’s choices and denies the majority’s, as an unconventional approach to finding overlooked opportunities. Inspired by a venture capital firm that used minority ruling to identify nanotechnology startups, we computationally demonstrate its ability to maximize noise impact and identify signals for contrarian opportunities. The wisdom of minority ruling lies in how it monopolizes the “flawed gems” hidden from competition-neglecting rivals. Our findings contribute to the literature on decision structures by incorporating competition dynamics and illuminate a behavioral strategy that underdogs can use to profit from incumbents’ blind spots.
