Three Common Misconceptions About Big Data

October 7, 2013 Jonathan Lewis

The concept of Big Data is well-established in the marketing world. But the irony for many of us is that we are no closer to making smart marketing decisions now than we were before it was well-known.

Where we used to make bad decisions based on too little information, we are now making bad decisions based on too much information. The pendulum has swung from Little Data to Big Data, but many of us are still using Stupid Data.

Stupid Data is what data becomes when it is misused or misunderstood. Any data set can become Stupid Data. Data is just a set of facts gathered together for analysis. But then we get involved. As soon as the information under review becomes overwhelming, improperly presented, or misunderstood it becomes Stupid Data.

The main culprit for Stupid Data is unreasonable expectations. We’ve been sold a slew of promises about data that have set us up for failure. The only way to slay the Stupid Data dragon is to bust misconceptions and rethink how we evaluate the information before us.

Below are three misconceptions about data to avoid.

1. More Data Equals Better Decision-Making

Wrong. In fact, the opposite can be true. As the amount of data grows, it is more difficult to evaluate—thus increasing your chances of making an erroneous decision based on it. The concept of “information overload” may have been popularized by Alvin Toffler in his 1970 book Future Shock, but even he couldn’t have predicted the paralyzing amounts of information marketers try to process today.

Raw facts by themselves will never answer a question for you. Only you can do that through thoughtful evaluation. And as the amount of data grows, your evaluation techniques must grow in sophistication and clarity. How you approach data analysis is everything. Be cautious about drawing conclusions. Ask hard questions. Then ask more. Look for correlations instead of causation. And always seek trends.

2. Customer Data Is Better than Team Experience

False. It’s become fashionable to discount real-world experience and worship large data sets. But to do so is like getting LASIK surgery then stabbing your eye out. Both experience and data are valuable when properly collected and evaluated. If the information goes against your gut, take an extra hard look at it. And most of all, learn to trust collective experience.

You likely have very smart and experienced people on your leadership team. And the answer to your challenge is probably already in one of your brains. The trick is to get it out. There’s really nothing like the data you can collect from a focused and well-facilitated round table discussion. Look to outside data to help validate gut decisions or settle disputes, but don’t let your team’s experience go to waste.

3. Data Eliminates Uncertainty

Incorrect. You can use data to reduce uncertainty, but don’t count on the data to eliminate it. The belief that uncertainty can ever be eliminated leads to unrealistic expectations, company paralysis, letdown, and frustration. IBM experienced this firsthand before its unlikely turnaround during the turn of the century. Quoted in a Forbes article about the toxic culture that nearly brought the company to its knees, Lou Gerstner described IBM as struggling with “obsessive perfectionism” and “studying things to death.”

The problem lies in a lack of understanding about human experience. We live in a complex and imperfect world. So no matter how big or little the data in our grasp, we will always have to make decisions with a certain level of uncertainty. The best decision-makers don’t fall into the trap of trying to eliminate uncertainty; they reduce it, then move on.

Stupid Data has been around for a long time. And it doesn’t look like it’s going anywhere soon. But you can learn to avoid it by controlling your data instead of letting it control you. Lean on team experience, put more trust in your gut, and look to data as a guide, not an answer.

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