IntelligenceFailure is a break in intelligence, especially situations where the right information has been collected into the vicinity, but does not reach the right place at the needed time.
After the tech crash, you get a job running medical records. A patient comes in who is going to die in 30 minutes. Doctors can't remember the patient's name, much less 100 pages of notes. The patient's medical record is in the building, but not in the stacks. Likely, the patient's lab is being worked on, or with the nurses for an old Triage, or is perhaps in Pharmacy. Medical records staff race searching for the chart, but it is not found in time. The patient dies. 5 minutes later, the chart is found. Intelligence Failure.
You are at home, and need to hammer in a nail. You go to get your hammer, but find out that it's uh... broken? You say to yourself, "I need to buy a new hammer." Two days later, you are walking by a hardware store. But, for whatever reason, you've forgotten all about the hammer. Intelligence Failure.
You live in a suburb of Seattle: Lake City. You can't connect to your ISP. You look in the phone book, find someone in Issaquah who could help for $40/hr. This man pollutes the air from Issaquah to Lake City, sells you a brand new modem, accepts $40, and then pollutes the air all the way back to Issaquah. But just across the alley, lives LionKimbro, who could have helped you. He'd happily fix the computer for $20, and runs on Food, not Gasoline. He's got an old modem sitting on his desk that he's been trying to give away. Intelligence Failure.
A less clear-cut example is some political and legal decisions. Often a political or legal decision is made based upon an assumed fact that many people consider "obviously wrong". While it is always possible that it is in fact the observer who is wrong, it is clear that often the policy-makers or jury simply did not have the right information despite there being a (correct) consensus on the disputed fact in other sectors of society. One goal of DebateTool/PropositionNet is to provide a mechanism for an individual to know if a given question has a consensus answer (according to some significant societal sector). That mechanism would prevent an IntelligenceFailure of this sort.
Too often people try to solve the problem of insufficient information by swinging all the way to the opposite end of the spectrum, but too much information, InformationOverload, is just another form of IntelligenceFailure.
The WeBust? of 2001 was also a form of intelligence failure, only on a grand scale.