Big Data!

In God we trust. All others must bring data.”

W. Edwards Deming, engineer, statistician, consultant

Mind your metrics

After the beginning of the annual hurricane season, and shortly before Hurricane Dorian, the National Oceanic and Atmospheric Administration (NOAA) updated their 2019 hurricane season forecast. Due to a weakening El Niño, NOAA forecasters say we could have a busier season, and provided this revised official forecast:    

For those who live in, own, or insure oceanside homes and businesses, based on these numbers drop what you’re doing and . . . and . . . do what, exactly? For each of the three categories, the forecast range is both above and below the historical average. For “major hurricanes,” for example, the average is dead center of the forecast range. It’s almost as if the NOAA is saying, “Well, there’s global warming and a weakening El Niño and all that, so we’ll just up the high end of the forecast for a couple of categories. But we’re not confident about this, meaning we could have fewer storms than usual, so we’ll put the bottom of each range below the average. Despite all the data we collect, and the cost to collect it, we really just don’t know.” 

While well-intended, this forecast is about as helpful as a weatherperson who says, “Well, our data doesn’t predict any rain for tomorrow, and radar doesn’t show any, but with all this heat and humidty you never know, so we’ll call for a 50% chance of rain. Be sure to take your umbrella.”

Better decision-making and outcomes

In business—as in sports, education, politics and everything else—analytics is all the rage. And for good reason, as access to better data allows for better decision-making and outcomes. How many steps did you take today? Your Fitbit knows all. But, as always, there’s no free lunch—capturing data comes at a cost. Cost to create the infrastructure to capture it, cost to report the numbers, and cost to analyze and determine what action they suggest. And the opportunity cost given that the money, resources, and time to do so could have been spent elsewhere. 

As a contributor to a team, or as the leader of a team, be on the watch for data creep at your company. As more and more data is collected and analyzed, the number of metrics tends to increase. Too many items get measured, and the metrics that matter can get lost in the avalanche of data. How many metrics do you really need? Sometimes finding the right metrics is obvious, and easy, but often it’s not. What few metrics drive the success of your team? If the data doesn’t directly correlate with some action you need to take, it’s likely not worth measuring. Can the data that is actionable be measured, and at an effective cost? If so, there’s your answer. And then there’s this from futurist Alvin Toffler, “You can use all the quantitative data you can get, but you still have to distrust it and use your own intelligence and judgment.” 

Like fire, data is a good thing. But play with it carefully. 

File under: Lead
Subheader: Mind your metrics

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