Death by Data

Data isn’t important in decision-making. What? Shocking! Then why aren’t we shocked when someone says that all decisions must be totally data driven? Perhaps it depends what we mean by data, which is usually something quantitative. 

We need to get out into the world and gather data by watching, observing, listening, asking – qualitative data. We don’t live in a binary world – it’s not either-or, it’s and-both.  We need quantitative and qualitative data. We need to consider both equally valid forms of data.  After all, as the sociologist William Bruce Cameron said (guess Einstein didn’t *),

Not everything that can be counted counts. Not everything that counts can be counted.”

Quantitative data needs to be part of the equation, part, not all.  More and more I see companies defining “data” as purely quantitative, dismissing or minimizing, at their peril, the importance of the qualitative.  Quantitative data can tell us a lot.  It an also tell us little.  Quantitative data has limitations – as does everything. These limitations are because the data usually is…

  • About existing “stuff”. It tells us about our current features, functions, customers and markets.  It tells us what customers are [stuck] using now, not what they really want.  It doesn’t tell us what our “stuff” could become or what new customers, markets and applications are out there;
  • Based in the present or the past.  We don’t have much ‘future’ data: what will, could, should or might be and what we could do to make that happen;
  • A glimpse in time.  It can be a year, five years, ten years, but it’s always piece of the bigger picture;At the Edge (Pemaquid Point, ME)
  • About the what, where, why and maybe even how, but rarely the why. Data usually doesn’t tell us much about fringe factors or trends that impact it.  It’s hard to have data show us the subtle societal, cultural, behavioral “whys” of influence;
  • Used to make things more efficient instead of more effective. Yes, efficiency (or optimization to be more eloquent) still rules for most of business today.  Data helps us figure out to eliminate unnecessary steps, improve productivity, reduce costs, etc.  Data doesn’t necessarily tell us why things need to be improved in the first place or new, different ways of doing, period.

As I like to tell my engineering students, most of today’s wicked problems aren’t optimization problems; they are system and design problems.  Think of the remote controls on your den table! Optimization issues are a symptom, not a root cause.  Data doesn’t necessarily tell us how to make the problem go away because it doesn’t tell us why the problem is there in the first place.  We have to actually get out of the office and look at how the problem is being addressed, not addressed, or not well enough by human beings.  We need to see how things are organized, structured, laid out, used, not used and under what conditions, circumstances and contexts. 

Data can tell us a whole lot about how our sites and stores and companies are working or not working, but data can’t necessarily tell us the whys – why it is or isn’t working, or working well enough. Without getting out and observing reality first-hand with all our five senses, we risk optimizing our organization into extinction. 

* http://quoteinvestigator.com/2010/05/26/everything-counts-einstein/

The Business Efficiency of Integrity

A 2-fer! One of my favorite companies & sites! Menasha, 165+ years old, is growing, profitable, solving customers' real problems and having an impact.  Key? Integrity - it truly pays dividends. Read on.  

"While much has been written about the relationship between integrity, trust and profitability in the last few years, there are companies who have lived this for over 100 years, like a 165 year old, billion dollar plus, 6 generation family business in Wisconsin, Menasha Corp.  Last year, in a discussion on the paradox of integrity, trust and vulnerability with John Hagel, Saul Kaplan, Mike Waite, President of Menasha Packaging Corp. (MPC) and myself, shared how integrity is key to Menasha’s success."  Read on..

The Energy Efficiency of Trust & Vulnerability

Note: Carl & I met at BIF9. As usually happens, a beautiful friendship and collaboration ensued.  Our conversations are like jazz...live, interactive, impromptu.  Eavesdrop on one here... 

Photo: Stephanie Alvarez Ewens

DMS: At BIF, you performed before an audience of over 400 people with two musicians you’d barely met before.  It was fabulous – resulting in BIF’s first encore!  The three of you had a common goal – a great performance.  You had aligned incentives – to create great music and not make fools of yourselves. This got us talking about trust – trusting people because of who they are personally vs. who they are professionally.

CS: Yes, I didn’t need to trust them personally, just professionally. If I’m going to fly, I have to trust the airline to have sane, sober, skilled, alert pilots.  We also need to trust systems.  If I have to go to the ER, perhaps a bad one is better than none.  If the alternative is worse, we might opt for no trust.  How much we need to trust others depends on the context, but also on how much we trust ourselves, our own resources and our ability to understand the context we are in; the more information and/or experience we have, the better we can decide whether or not to trust.  Trust is a tool to assess and manage (reduce and/or increase) risk, depending on the situation.

How much we need to trust others depends on the context, but also on how much we trust ourselves, our own resources and our ability to understand the context we are in

DMS: Trusting someone implies making oneself more vulnerable and finally it seems the world is recognizing that is what it takes to create great leaders.  Trust has big implications on our resources, as you’ve said.  When we don’t trust, we exert a lot of energy to keep up our guard, to continually assess and verify.  This uses a lot of energy and time.  When we trust, we re-allocate that energy and time to getting things done and making an impact.  As we let ourselves be vulnerable, we also leave ourselves more open to new ideas, new ways of thinking which leads to empathy and innovation.

Photo: Stephanie Alvarez EwensCS: Absolutely.  When we trust, we reduce hassles, bargaining and redundancy.  The more information and/or experience we have, the fewer buffers we need around our decisions and the more we can focus on the scope and achievement of our goals. Being vulnerable is a way to preserve energy.  Basically, we are saying, “I won’t use resources on this because the pain of being vulnerable ‘costs’ less than the cost of NOT applying my resources elsewhere.”  For instance, choosing an instrument (or a profession) is a kind of vulnerability. No instrument can play everything.  To create great music you need an ensemble — a trio, quartet,  basically a team of players with complementary strengths, skills and vulnerabilities and a willingness to listen to each other and a common goal.

When we trust, we re-allocate that energy and time to getting things done and making an impact.  As we let ourselves be vulnerable, we also leave ourselves more open to new ideas, new ways of thinking which leads to empathy and innovation.

DMS: Trust and vulnerability are keys to “Energy Management”. Not to sound too 19th or 20th Century, but trusting is efficient….and effective.  It lets us reallocate our resources to what matters and utilize our skills and those around us to increase effectiveness…impact.  Energy Management raises the issue of perfection. If we are working together, we need to agree on the meaning of ‘done’.  When are we done, what does that look like? And that’s in the eye of the customer/audience.  So we need to understand customers’ needs and how well we can meet those.   We need to recognize that ‘good enough’ can really be good enough.  The Lean Startup movement encourages a Minimal Viable Product (MCP), building what’s critical and leaving the non-critical for a later.  My daughter says, “Don’t let perfection be the enemy of accomplishment.” Growing up in Bell Labs, I saw the need to know and control everything hold us back from realizing value.  Your wife’s phrase, “Control is for Beginners” is so a propôs.

CS: Knowing when to stop is key.  Strategic sloppiness is a way to preserve energy.  Don’t line up the boxes, disregard the typo’s, narrow the scope – Simplify!  The use of shared references is a big part of this.  Build on the same shared mental models (e.g., Peter Senge); use the same language (e.g., Hanna McPhee: Design & Science); make sure we hear and see the same thing (reduce buffers around our response); allow for larger margins of error in our response and our acceptance of others. This is especially true when we are working in real-time, where higher perfection slows down the tempo.  We have to eliminate anything that slows us down, which forces choices in real time. Think of when we’ve been on a stage giving a presentation (or running out of a burning building).  If we can´t think of a specific word, we skip it and make something up — we lower the bar as much as we can.  Being live forces us to be flexible, like a nerf ball instead of a steel ball. If we are too hard, we are still vulnerable because we will crack, not bend and flex and live.

DMS: We can’t minimize the need to be effective.  So much of the 20thcentury’s focus on efficiency over effectiveness ended up being inefficient!  If the outcome didn’t meet customers’ need, who cares how efficiently it was made?  Efficient systems are great at dealing with complicated things – things that have many parts and sequences, but they fall flat dealing with complex systems, which is most of world today. At BIF8, Brandon Barnettgave a great story about the difference between complicated and complex. Effective solutions to wicked problems rarely come about through efficient and linear thinking.  It’s usually messy… and increasingly effective.

CS: The Industrial Revolution was based on achieving efficiency by scale through replication – a frozen goal in a static context.  This led to managing people and machines as one and the same — striving for uniformity/conformity, precision, low deviance, repetition, predictability and static, strict standards.  Things could be complicated but not complex (because they were static and not interconnected).  Now, easy, repetitive tasks are being de-bundled and out-sourced or automated which speeds things up, from months to weeks to minutes. Add to this that more and more interfaces are standardized and subjected to competition (per Clay Christensen) and we are seeing an emerging alphabet — components that can be assembled in endless combinations as manifestations of unique ideas.  As the ability to replicate something has become more of a commodity, we are increasingly seeing that complex interactions are the way to create ‘value from difference’ (as opposed to ‘value from sameness’).  But again, the complex interactions require judgment, intuition, data, timing and experience.  Technology does not do much in a complex interaction (per McKinsey´s articles on interaction).

Trusting is efficient and effective.  It lets us reallocate our resources to what matters and utilize our skills and those around us to increase effectiveness

DMS: Which is why ‘soft-skills’ are so critical in our complex world.  The ability to look at things from many different perspectives, to discover, uncover, understand and empathize is critical.  While everyone says the Millennials are forcing businesses to focus on meaning and purpose for work (outcomes) instead of just money and profit (outputs), I think we’ve always wanted this, just haven’t vocalized them for a variety of reasons. This brings us full circle back to trust and vulnerability.  When we have a common goal of WHY we want to do something, we are better able to trust.

CS: That’s why complex interaction workers are the fastest growing and the best paid part of the labor force.  The Jazzcode governs how we can improve the effectiveness of these workers.  When we never do the same thing or have the same conversation twice, it becomes much more important to figure out why and what we do than how we do it (process, which is a given).  Personal leadership and character become more important.  As work moves from executing scripts to interactive conversations, the need for active listening and presence in the moment is increasing.  We have to challenge the industrial culture in our work places to enable people to have better interactions. Only then can we get the true potential for original ideas and real collaboration.  It is in the give and take of a conversation, which is needed in complexity, that understanding happens.  Just like playing jazz.

DMS: And, just like jazz, the conversation continues…

This originally appeared in Switch and Shift.