Is information working for or against you?
The world is awash with information. Everyday more data is being collected about more things. In theory all this information is great for companies. The more information we have, the more we know. The more we know, the better the decisions we make. Right?
Often the reality is different.
The more information we have, the more we want. The easiest thing to do when we encounter a new problem is commission more research or analysis. We place a premium on new insight. Of course new is great when you can find it. But identifying what is important is even more, well…, important. It is amazing how many times the big, important things are right in front of us. But sometimes it feels too easy or obvious to focus on them. Why spend your time on the big things you think you already know, when you can try to discover a bunch of exciting new things?
The frustration is that all the extra information usually tells you what you knew anyway. Same outcome, but you have lost 3 months and lots of money along the way.
The challenge for most companies is not that they don’t have enough information, but that they have too much.
So, how do you make information work for you, not against you?
Firstly, you need to know what you are looking for. You have to ask the right questions and have the right hypotheses, then use data to prove or disprove. We call this the “scientist approach”. Any good scientist has a set of hypotheses that they test and refine over time. Data hasn’t cured diseases, the right hypotheses have.
Secondly, you have to simplify and use data to support not lead. How many times have we all sat in presentations, not listening to what the presenter is saying, but trying to work out what on earth all the data points are saying? The excitement is not in the data, it is in the conclusions. And it is the conclusions communicated in a simple, clear way that drive actions.
Finally, data can’t be a substitute for management judgement. We’d all love data to tell us exactly what to do, but it can’t. It can inform, but it can’t decide. In the same way as consumers can’t design the next innovation or develop our category strategy for us. We need to be brilliant at the application of data. This means knowing what is important to winning with consumers and shoppers and ruthlessly executing against it.
By the way, is this another reason why the Discounters are winning and traditional grocery retailers are struggling? You can bet Aldi have a fraction of the data that Tesco do, but it doesn’t seem to be harming them too much.
So, next time you are wading through the latest piece of information that lands in your inbox or sitting through the latest research presentation, ask yourselves is all this data working for or against me?
Have a great weekend, speak to you next week.