Everything Is Data-Driven
Every organization in the 21st century wants to be data-driven. What does that mean?
In this post, I will consider some possible answers. I will then argue that data-driven doesn’t really mean anything. I will also argue that data professionals aren’t hired to help organizations become data-driven, and why intuition is underrated.
What Does Data-Driven Mean?
This blog values thinking clearly. Before I move forward, I will at least try to clarify what data-driven is.
Answer #1: Tools
The book Creating a Data-Driven Organization, provides the following:
Data-drivenness is about building tools, abilities, and, most crucially, a culture that acts on data.
This answer implies that “data-drivenness” requires tools. Occam’s Data disagrees. Tools complicate things and tools evolve. Tools might help organizations in their efforts to become “data-driven”, but they certainly can’t be necessary.
Answer #2: Validation
I’ve heard many executives make the following claim:
Data-Driven means making decisions backed by data.
Occam’s Data neither agrees nor disagrees. This isn’t really saying much.
Remember Occam’s Data’s definition for data. Data is information. Decisions backed by “information” doesn’t have the same ring to it. Yet it’s another way of saying the same thing.
We should also be skeptical when someone claims: “this is supported by data.” Not because their data is wrong. But because there is data to support anything.
Data-Driven Is About Making Decisions
Organizations are not data-driven. Decisions are data-driven. In other words, organizations use information to make decisions. That information could come from customer behavior, or it could come from someone’s head. Every decision relies on information. Every decision is data-driven.
But it’s the decisions that matter, not the data. Without data we just have our intuition, and intuition is often good enough.
Intuition > Data
The intuitive mind is a sacred gift and the rational mind is a faithful servant. We have created a society that honors the servant and has forgotten the gift
- Albert Einstein
Consider a driver approaching a “STOP” sign. When the driver sees the sign, they will make a decision to stop their car. They may see the information on the sign that says “STOP”. But for most drivers, this decision is intuitive. And it’s the correct decision every time.
I’ve seen many data professionals warn their stakeholders about relying on intuition. They urge their organization to validate their intuitions with data.
Occam’s Data argues the opposite for the following reasons:
Intuition is information - And therefore it is data.
Intuition is data-driven - It is data that is backed by data; the human experience.
Intuition is automated - It requires little effort to retrieve.
Intuition suggests an action - It is information that comes with a recommendation
Intuition can also be right when data is wrong. I used to believe I needed data to validate my intuition. But in reality I’m more often using intuition to validate my data.
Why Do We Need Data?
If decisions are what matter, and intuition is sufficient to make decisions, then why do we need data?
The short answer is that we don’t.
We also don’t need the internet, books, or data. But all of these things have value because they provide us with information.
They give us informational leverage. But only when that information is accurate and organized.
A Simpler Way To Be “Data-Driven”
Organizations shouldn’t aim to be data-driven. They should aim to organize their data. If this post provides any value to its readers, it will be that language matters.
The objective of this blog is to simplify the data profession. “Organizing Data” is an easier way to understand the data professional’s value. Talk about your work as if you’re explaining it to a 5-year old. The more data professionals do this, the more impact we will have.
Exercise
Write down all the decisions you’ve made today.
What information did you use to make those decisions? How did you retrieve that information? Was it quick and easy? Or did it take time?
Feel free to send me your answers. There is no correct answer, the goal of the exercise is to help you think about how we use data, and why it’s valuable.