Data Backed Decisions (with a twist!)

It is almost always a good practice to have supporting data for any decision which has to be made in a business setting. It makes the case stronger and increases the likelihood of favorable outcome from the decision. Many good senior managers don’t make the decisions unless the data supports it. Of course, there are situations where we might not have sufficient and/or relevant data and there exist time constraints for making the quick decision. In such cases, the experience and common sense of the managers come into the foreground. However we are not focusing on these situations in this article, we are looking at the general data backed decision making “process” (I would though refrain from using this word). Also, I am trying to talk about the generic decisions in business settings made daily, not the use of “data analytics” for targeted outcomes/insights.

The focus on data-backed decisions seems to be increasing exponentially. But this “data” has started to look more and more ambiguous and undefined. The degree of correlation of this “data” with the actual problem (for making a decision) can be easily and conveniently overlooked by all, as long as it is something that “seems or sounds or looks” related to the problem. The context of the “data” can be entirely different compared to the problem in hand, but as long as the “story or narrative” conveys a similarity, it is readily taken into consideration with full confidence. Let me give some examples.

Suppose as an HR you are asked to create the Employee Satisfaction Survey (ESAT / Climate Checks) for the organization which will be rolled out for all employees. What is normally done in this case is ready-made questions are picked from leading consulting companies (Gallup Q12) and this “data” is presented as a verified, tried-and-tested template which has been in use for quite some time by many organizations. The person listening to this will get fairly convinced as this is something done by many reputed organizations and hence the risk is less. Also if s/he is questioned tomorrow on the entire program for its feasibility/need/resources, s/he has “data” to back up his decision for going with the questions of ESAT. A win-win for the employee-manager.

Now just dig one level deep in the above scenario. The “data” which backed up the ESAT was a standard template used by some big companies. But which sector? Are we in the same? More importantly, what is the employee size of these companies? Are we in the same bracket? What were the results of the ESAT, how was it used by those companies? Do we actually want to take actions on ESAT data? Do we have the resources to take action even if we want to? The context is different.

Also as seen in above case, easy availability of “data” (you can always find tons of data on net to either support or contradict a case) which can back up a decision makes us blind to other alternatives for getting the solution. In the above case, one effective alternate decision exists (out of possibly many). Every HRBP of a BU keeps records of formal one-on-one sessions done with employees (often a part of their KRAs). Just get this data from all HRBPs, get to understand what are the real ground issues being faced and take that as an alignment to create ESAT. The answers will be more useful that to the generic Gallup Q12. Also IF (and it’s a very big IF) the management decides to take some actions from ESAT results, they will be directed to something that is real and important, not something which comes out of standard ESAT. I mean garbage-in garbage-out situation can be avoided.

I have seen senior managers who have pet-HRBPs, asking them to get some (any) data to justify their new “Employee Engagement Initiative” (mostly like rangoli and painting competitions, arrg!) and approve their budgets. This “data” along with the post-event photo-laden broadcast email ensures that such events continue to exist in spite of many other possible and useful activities. I am not against these events, they are good for school kids. But see the dismal participation and gender ratio of such events. Why have events only for a small fraction of the minority? Just because it’s easy and you like it?

A similar concept of data backing goes in the annual performance appraisals at companies. If you are able to come up with a solid list of things you have done, catastrophes you have avoided, the money you have saved for the company, guys you have trained, value you have created, then there is 99% chance of you being in the top ratings and hikes (assuming you have actually done some work, if not, still have some data, better to be in middle than left extreme of the bell curve).

So use this “data” backing for getting your work done (other’s ignorance is your bliss).