Data is the enemy of the digital revolution - here's why

Information is far less important than what we do with it.

by Tom Goodwin
Last Updated: 25 Apr 2018

With many million more sensors, better resolution satellite imagery and much faster computers, we now know much more about Hurricanes than ever before. Between the size of this data, the speed it comes to us and the power of processing, we see typically see storms a week earlier than just ten years ago.

Yet due to the vast complexity of weather interactions and their near perfect chaos, we’ve made little progress on predicting the path. So we now have a week longer to be anxious. 

There is no better metaphor for the current reality of big data in business. Until now we’ve celebrated the process and the power. Maybe we should focus on the meaning and decisions we make as a result. Perhaps we celebrate the size of big data when we should be excited only by the profoundness of decisions we can make with it. 

Data in the age of uncertainty

One of the most common requests I get in my role is to come up with ideas that have never been done before. It’s a very reasonable request that always ends up unreasonable. After I craft and send over ideas, in order to feel reassured, I’m soon asked for examples of other companies that have done this, and when I explain why this isn’t possible I’m asked to prove that the idea will work in some sort of spreadsheet. We seem to need data as a crux, when once our passion and understanding was enough.

While we talk a lot about the pace of change today – and it’s a huge issue – an even greater worry is uncertainty. Facing rather unpredictable circumstances – Trump, Brexit, the rapid rise and then failure of Pokémon Go or fidget spinners, the failure of VR headsets, the crazed interest in smart speakers – what the world needs most is reassurance.

It’s now better to act logically, to make sensible decisions based on data, and be rather unsuccessful, than it is to do something pretty outlandish, based on a whim and succeed wildly. It’s much easier to be fired for being too imaginative, than too boring.

Undue Confidence 

At a time that requires data – accurate, confident data – no end of companies offer assurance beyond what is possible. We see outlandish predictions about the rise of voice commerce, way before it’s actually taken root. We see precise predictions about the value the internet of things will bring, without any thorough definition of what it really means.

It astounds me that we take figures about the value of 3D printing, from 3D printer makers, and place them freely in presentations to justify decisions we need to make. A single, ludicrous figure – like ‘by 2020, 30% of web browsing sessions will be done without a screen’ – can travel around the world and into business planning sessions a million times before rational thought or critical thinking has had a chance to catch up.

Data looks backwards

The issue is that data doesn’t help us when things change so much. Knowing how brands spread when they relied on building supermarket distribution doesn’t help plan for an era where brands can explode overnight and sell direct. Data is backwards oriented. It shows clearly the past, but never the future. No data showed that a drink called Red Bull would thrive in a non-existent category. No data suggested a £300 vacuum would storm the market like Red Bull. It didn’t show that gradual tanning body lotion would rip apart the body moisturizing industry.

Looking at how people used phones didn’t pre-empt an era where we share endless photos, review restaurants and get in strangers’ cars because they’ve been rated. All profound shifts in behaviour are where there is the most money to be made and where data is most blind.

It prioritises the useless 

The McNamara fallacy states that not everything that counts can be counted and not everything that can be counted, counts. We’re now in a period of time in business where the clock runs faster, the average tenure of most jobs is shortening and people are feeling more pressure to perform.

Can you build distribution fast? Can you show sales were down to your actions? Can you change brand awareness quickly and measure it accurately and cheaply? Get quality reviews in the press?

The things that matter the most are hard and expensive to measure, slow to change and often impossible to attribute. In comparison it’s very easy, quick and cheap to measure social media followers, share of voice, retweets, impressions. We quickly find our businesses chase the metrics that are most useful to show apparent progress, even though often these metrics have absolutely no business merit or are poor proxies for ones that do. 

As businesses seek to grow, to adapt to a fast changing, unpredictable world, this may not seem like useful advice, but let’s stop our obsession with using terrible data as a crux. Let’s rely on our innate understanding of people, our confidence in conviction, our empathy and imagination. We can use data to interpolate trend lines into the future, or we can create precisely the sort of disruption that always renders them obsolete and wrong.

Tom Goodwin is executive vice president and head of innovation at Zenith Media USA. His book Digital Darwinism: Survival of the Fittest in the Age of Business Disruption is out now in paperback and ebook, priced at £14.99.

Image credit: MicroOne/Shutterstock

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