Data or Gut Instinct For Making Decisions In Your Business
It’s no secret that data analysts must have a lot in common with detectives. Right?
Each depends on clues, and facts to decide on the best path forward.
Both collect and look at the evidence.
Both talk to people who know part of the story.
And both might even follow some tracks to see where they lead.
Whether you’re a detective or a data analyst, it’s necessary to follow steps to collect and understand facts.
Analysts and ultimately stakeholders should use data-driven decision-making and follow a step-by-step process.
Here is a six-step process how to help make the best decisions:
- Ask questions and define the problem.
- Prepare data by collecting and storing the information.
- Process data by cleaning and checking the information.
- Analyze data to find patterns, relationships, and trends.
- Share data with your audience, stakeholders, and the team who are concerned.
- Act on the data and use the analysis results.
But there are other factors that influence the decision-making process. We all remember Sherlock Holmes, the famous detective, who many times used his gut and followed a hunch that helped him solve the case. And we know that hunches could be somewhat effective, however, it’s important to note that a gut instinct is an intuitive understanding of something with little or no explanation. This isn’t always something conscious; we often pick up on signals without even realizing it. You just have a “feeling” in the pit of your stomach about something.
Gut instinct is a human tool and data analysis is a technical tool that together guides business decisions. It is important to evaluate both your gut instinct and your data analysis. Especially knowing that human emotion, biases, and going with your gut could lead to big mistakes.
Why gut instinct can be a problem
At the heart of data-driven decision-making is data. It’s essential that data analysts focus on the data to ensure they make informed decisions.
If data gets ignored by preferring to make decisions based on your own experience, or gut instinct, your decisions may be biased. But even worse, decisions based on gut instinct without any data to back them up can cause errors and mistakes.
When you really dive into the data related to a project, it simplifies what you need. This work will help you see any mistakes or gaps in the data so you can share your findings effectively. Sometimes your gut instinct will help to make some connections that have gone unnoticed. Such as a detective might remember a previous case and is able to solve the one he is working on now.
Data + business knowledge = mystery solved
Combining your business knowledge, experience, and data with a touch of your gut instinct is a recipe for success. The key to knowing just how much of each will depend on each project. Many times it is dependent on the goal of the project. The number one question, I and my peer data analysts will ask is, “How do I define success for this project?”
In addition, try asking yourself these questions about a project to help find the perfect balance:
- What kind of results are needed?
- Who will be informed?
- Am I answering the question being asked?
- How quickly does a decision need to be made?
Other often asked questions related to every project and without knowing the answers to these, because it is a quick turnaround rush project, you might need to depend on your own experience and gut. However, given enough time and resources, it is always better to be data-driven. As a data analyst, always make the best possible choice. It’s likely that you will merge your knowledge and data a million times over the course of many projects. Let’s connect.