Big Data Doesn’t Mean Better Decisions, Part 2

18 Jul

Big data and business insight will not deliver any benefits unless you know how to use it and what you are going to use it for. In fact, I could make a good case for ignoring it completely and why a company would be just fine without it. But big data is an opportunity which also currently presents a problem, how does a company get value out it and\ or how does it demonstrate value to invest in big data and its analytics?

Big data and analytics promise better decisions, but this will not happen without an examination of HOW these tools will produce better decisions. The business environment is highly complex, influenced by unexpected events and human behaviour, therefore you can’t find answers to questions, but you can manage outcomes in a more favourable direction based on analysis. And this is the key, the decision making process which maximises big data needs to be focused on improving human expertise.

So, the promises of improved decision making won’t happen until we acknowledge it’s human beings who are choosing the questions to ask, where to look, what to consider important and when to stop looking. The above are intuitive and analytical decisions, so in order to get the most out of big data analytics we need to focus on building up human expertise in their use. If we don’t, then there is a distinct danger users will think more and more information is the answer to complex issues such as- what will our customers want next year? There are so many variables in play influencing this outcome, that more information will simply add more complexity. As a user attempts to integrate more and more data points into an issue which has no defined answer, they will simply become confused. Efficiency and outcomes will be greatly improved when intuitive analytics take over.

If a human being is ultimately choosing where to look, then how can we improve the quality of where to search and what to ask? I believe an answer lies in firstly using beliefs to produce a picture of the future then using analytics to disconfirm this belief. This will not only provide an array of options to move between if events start taking apart a business plan, but also improves the ability of users to recognise cues and patterns which can lead to opportunities; decisions need to be dynamic, not static wait and see. The result is improved beliefs which guide the initial search points in the future, and faster, more efficient searches and decisions.

The current work of our research company is focused on some honest facts- it’s very difficult to gain expertise in business and sometimes the confidence of business leaders is misplaced. But you can manage decision making to produce better outcomes in complex environments. Big data has provided an opportunity to test long held assumptions about an organisation’s environment and customers, and most significantly, to modify the mental models we use to make decisions. This approach has huge implications for how we use analytics, and how we balance the relationship between data and intuition. For example, it’s possible to use a simple 3 step process to use the Google search engine to test assumptions underlying decisions and modify beliefs, in 5 minutes.

I do not think we will ever see true expertise in business decision making, but we can develop increased expertise in analytics which will improve our ability to manage complex domains. To be clear, big data is an opportunity, but by using a simple approach which blends the natural decision making process of human beings with sophisticated analytics we can maximise its value and make the investment work.

One Response to “Big Data Doesn’t Mean Better Decisions, Part 2”

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  1. The Analytics Big Bang | The Applied and Digital Humanities - July 29, 2013

    […] Big Data Doesn’t Mean Better Decisions, Part 2 (decisionsdotorg.wordpress.com) […]

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