The Culture of Analytics

Jim Novo has really stirred up the hornet’s nest now. His post on “Analyze, Not Justify“, is a great read.

Down in the comments Jim links to another post “Fear of Analytics“. It’s another good read.

It all goes to the culture of analytics.

There are people who are fail tolerant and people who are fail avoiding. I don’t see how people can survive without a healthy balance of failure and success. Repeated success is required for confidence building and repeated failure is required for learning. Like everything, there’s a downside too. Repeated success can lead to arrogance. Repeated failure doesn’t guarantee that somebody will learn, either. The fail avoiding behavior, if it persists too long, results in stagnation and, ultimately, long term fail.

An organizational culture that tolerates repeated failure without learning is destined to collapse. An organizational culture that doesn’t tolerate failure, even it means learning, is destined to stagnate.

Experimenting with various First (tweaks) and Second Order (major) changes to products and experiences over time, if there is an accumulation of knowledge, ultimately leads to short term and medium run commercial success. The losses from small failures are offet by the gains from an accumulation of knowledge. Some believe that multiple Second Order changes leads to a paradigm shift and to commercial renewal over the long run. (We know that certain countries from a public policy perspective can do this. This idea of ‘innovation drift’ is kind of interesting.) Admittedly, there are several decisions that somebody at the C-suite only get to make once.

A culture of analytics is a culture that is failure-tolerant and actively manages the risk of innovation.