One of the most important transitions that happens within an organization to allow it to scale rapidly is the transition from anecdotal data to analytical data when making decisions. There is a fantastic parallel in how pilots navigate the skies.
When you first start flying, you fly below the clouds. This allows you to navigate visually. You look out the window and know where you are based on the roads, hills, and other landmarks below you. Sure, you may use a GPS, and you’ll have a compass and altimeter in the cockpit. While these tools help, they all serve a supporting role to what you see with your own eyes. Flying visually gets you off the ground quickly. It allows you to be nimble and rapidly respond to changing conditions as they happen.
However, flying visually also has its limits. You generally can’t fly at night. You typically must stay under the clouds as well. Both of these restrictions limit how far and how fast you can go. If you want to really get somewhere, you’ve got to get to 35,000 feet. You’ve got to go above the clouds, and when you do, the rules of the game change, literally.
To fly above the clouds, pilots need to learn and obey an entirely new set of rules.
Instrument flight rules (IFR) govern what you need to do to fly above the clouds safely. Above the clouds, you can no longer rely on roads, hills, and other landmarks. Sometimes you can see them, but at some of the most critical points, you will be flying blind because of cloud cover or nightfall.
You need to be able to rely solely on the data coming from the instruments in the cockpit and the data coming from control towers along the way.
The way you use data to make decisions within your business follows the same progression.
When you start a business, data is generally an afterthought when it comes to the choices. You see something, and you go after it. Something breaks and you fix it. You hear a story about a customer complaint, and you change the whole system to solve it. In other words, anecdotes are the primary data type for your decisions.
And this is the right thing to do for a time. It allows you to adapt, change, and respond quickly. You make decisions fast and execute them more swiftly. This rapid decision-making/execution is like rocket fuel for your new business.
However, as you start to break free from gravity, the rules change. There are more people involved, and every new decision seems to take longer and longer to execute. As news of the decision travels through your team, it gets less and less clear, and the further it goes, the longer it takes for the feedback to make its way back to the chief decision-maker(s). Then mistakes start happening.
When it comes to how you make decisions, the very thing that brought you success in the past will start to cripple the business’s ability to scale. It’s time for an upgrade.
The upgrade comes when you begin replacing anecdotal data with analytical data. Analytical data will give you more information and help you to see through your current biases and past experiences to make the right decisions for your business’s new stage of development.
It’s not easy
However, it’s not an easy transition to make. Here’s why?
- It slows decision-making down, way down. You used to go from problem to solution in about 13 seconds. Now you have to wait for the right data to make a decision. This part of the transition into a scale is particularly tricky. It usually feels like things grind to a halt. For the first time, you feel the threat of analysis paralysis, and you think it’s going to kill you. Hang in there.
- It’s confusing. It is typical at this stage for your business to have very weak data muscles and even less data coordination. It’s like strapping a pair of roller skates on a pig and then setting it loose in the middle of an ice rink. It’s not going to be pretty. When you start looking at spreadsheets, it may feel like a part of you dies. You’re going to feel awkward. You’re going to mess it up. You’re probably even going to lose a bit of your confidence, but hang in there.
Why is it worth it?
If it’s such a difficult transition, why do it? Remember, to get above the clouds, you have to change the way you fly, but once you get above the clouds, you can go further and faster than ever before!
The good news is, while the transition is tough, it’s only a transition. The snail-paced decisions will pick up speed. Even better, the glacier-paced execution that is dragging your organization to a halt will become faster than ever. You just have to get through the transition.
How to move from anecdote to analysis
Here are four steps to get you on track to move from anecdote to analysis.
Step 1: Trust but verify. The best way to get your feet wet is to use anecdotes as flags to start your search. If you hear, Customer Bob is complaining that his order is late, resist the urge to rush to action and change the whole process. Instead, start asking questions like:
- Why did this happen?
- How many times has it happened? (And, importantly, how many times has it not happened)
- How can we change our systems and process to solve this problem permanently without causing delays for customers who aren’t having this problem?
Step 2: Lean into team-based decision-making. When it comes to upgrading your decision-making, I hate to be the bearer of bad news, but you are probably a big part of the problem. Don’t fall into the trap that would have you believe everyone else needs data, but you don’t because you know the right thing. Your best defense against short-term, anecdotal decision-making is to start moving decision making to a high-quality team setting.
Step 3: Hire or promote help. Even with the move to team-based decision-making, you probably need another voice at the table, the voice of a Processor, or someone who thinks in data, loves data, and has the willingness and ability to work through that data with you and find a meaningful solution.
Step 4: Make data available for every meeting before the meeting. This is the last major step in the transition from anecdote to analysis. Before every leadership team meeting, distribute the relevant data for every agenda item. Then REQUIRE every team member to review the data before the meeting. Before the meeting is the time for other team members to question the data and ensure that they understand it. Then everyone can show up to the meeting ready to resolve the issue and make a decision rather than bicker over the validity of the data itself.
Wrapping it up
If you’re growing business isn’t growing like it used to, if you feel like you’re making decisions but the job isn’t getting done, if it just feels like you are trudging through the mud, it may be time to get up into the clear air above the clouds. To do that, you need to start making your decisions based on real, analytical data. Once you build these new decision-making muscles, your business will grow faster than ever, and you’ll never want to go back!