- 7/24/2014 9:33:33 AM
Tracy, glad you mentioned a decision support system, as that's what had come to mind as I began reading through your comment. I'd like to see more companies take advantage of automated decision management systems -- as long as, like you suggest, they enable exceptions (with explanation) and allow for continous feedback and improvement. Do you think enough companies incorporate decision managment systems into their advanced analytics strategies?
- by louisw900, Blogger
- 7/23/2014 9:59:49 PM
"...The data and resulting insights aren't supposed to replace the decision makekr's gut. They are supposed to inform decision makers and help them narrow the unknowns. But in the end decision makers are paid to interpret those unknowns and make a call. In other words, they use their gut, and rightfully so."
@David Schimitt Agreed. Somehow the discussion has morphed into Data vs. Gut , when as you and others mention these two factors supplement the other. No question this is a difficult task because most are not fluent in the effective practice of analytics. Many enterprises rely on the "cash cow" nature of their business unfortunately.
Of course the argument is that analytics will improve margins, squeeze every little bit out of every corner. Well there are more than a couple of barriers to this, but for starters a company really needs a strong foundation in the use of Analytics as it relates ( and that is the most important part IMO ) to their business.
- by Ugly Research, Statistician
- 7/23/2014 7:59:22 PM
Beth, Really good question. We can never know what's happening inside someone else's head, or how they used data -- unless they're willing to tell us. After years of studying how people explain decisions, I've learned that we're all tempted to blame someone for 'ignoring the evidence' when we disagree with them.
Without explicit capture of decision processes, we can't measure 'data vs. gut' -- or 'data + gut'. My work focuses on creating transparent (but not too painful) ways for decision makers to find relevant data and acknowledge how they weighed it. We can improve substantially on the old model of citing references, or compiling lists/matrices of factors. So accomplishing what you suggest (measuring 'data vs. gut') is possible if we have a practical way to see what the evidence says, and compare it to decisions being made.
Example: In evidence-based medicine, a clinical decision support system can make recommendations based on patient data and available evidence. Then the physician can accept that, or suggest a different action/treatment (some workflows require the care provider to explain exceptions). After that healthcare cycle plays out, we can perform analytics on electronic health records, outcomes, and decision support systems to measure the quality of a decision process, and how successfully the evidence was incorporated.
Unfortunately, in areas such as business strategy, comprehensive evidence isn't so available. I'm hoping that will change. Decision makers do get useful data from tools such as BI and data visualization. But it's typically not incorporated into end-to-end decision processes that connect actions to outcomes, supported by evidence-based recommendations. I look forward to the day when a marketing manager can easily see a systematic summary of evidence from multiple sources on, for instance, paid search marketing. Then we could begin to measure whether his/her marketing plans were based on data or gut.
- 7/23/2014 3:15:47 PM
Tracy, thanks for jumping in here. I haven't had a chance to read your piece yet, but in the meantime let me ask: Do you think the balance we see now between data and gut is appropriate? My sense is that when the data is counter to gut, the decision maker can be all too willing to disregard the data and favor the gut. Maybe that turns out OK sometimes, maybe not. But how do we measure that?
- by David Schmitt, Blogger
- 7/23/2014 2:12:43 PM
I totally agree with this. The data and resulting insights aren't supposed to replace the decision makekr's gut. They are supposed to inform decision makers and help them narrow the unknowns. But in the end decision makers are paid to interpret those unknowns and make a call. In other words, they use their gut, and rightfully so.
I wrote about this some time ago on this site -- glad to see the topic resurface!
- by Ugly Research, Statistician
- 7/23/2014 1:35:17 PM
'Data-driven' vs. 'Gut feel' isn't the problem that needs solving. Technology should supplement human intuition, rather than try to replace it. For instance: Medical diagnosis is messy, requiring hard evidence *and* the physician's decision-making.
My recent Evidence Soup post explores this further: The Data-Driven vs. Gut Feel hyperbole needs to stop.
I also highlight the data/intuition debate in my new research paper: Data is easy. Deciding is hard.
Tracy Allison Altman, PhD
Ugly Research (founder) - @UglyResearch
Evidence Soup (editor)
- by Broadway0474, Blogger
- 7/22/2014 11:16:20 PM
@Maryam, as one wise businessman I know likes to say, business is about emotions. And trust is a very strong emotion. That's why relationships (with vendors for instance) will remain key decision drivers, despite what numbers may say.
- 7/22/2014 4:16:51 PM
Hi Maryam. Yes, you're right --- when a new leader comes in, nothing is guaranteed. But with increased use of business analytics, I'd hope that change just for the sake of change (or ego) gets harder to accomplish.
- by impactnow, Blogger
- 7/22/2014 1:19:28 PM
Beth I have witnessed it firsthand sometimes previous relationships weigh heavy on project awards. I have seen cases where all vendors were replaced because the new leader preferred vendors from previous workplaces. While the numbers should be a key driver at times they just hold a back seat to old habits and comfort levels.
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