Results of a new survey by Queen’s University’s Smith School of Business paint a conflicting picture of the influence of big data and executive’s reliance on it.
More than half (52 percent) believe they rely too much on data and analytics and not enough on intuition, while 41 percent believe the opposite.
“We’ve seen an incredible uptick in the amount of data available to business leaders over the past decade,” says Salman Mufti, Associate Dean and Executive Director of Queen’s Executive Education at Smith School of Business. “However, leaders are still learning how to best use that data to improve the efficiency and profitability of their organizations.”
Four out of five business leaders at least somewhat agree big data has changed how leaders make major business decisions and those decisions are now based more on data than on intuition and experience.
Not all of that 81 percent believe those decisions are better, though most (56 percent) believe big data-based decisions are better than ones based on intuition and experience. Twenty-eight percent feel big data makes no difference.
Mr. Mufti believes there is a middle ground.
“What business leaders should recognize is that data analytics and intuition are not mutually exclusive. Even when we use data, intuition and experience are still critical in developing novel strategies to meet business challenges. The additional data available simply allows us to test our assumptions, recognize new patterns when creating strategy and make course corrections when strategies are not working out.”
Gut decisions tend to be employed when time is limited, the decisions involve people, or in volatile environments. Most leaders (78 percent) at least somewhat agree intuition is best for quick decisions.
Too much information can be just as damaging as not enough, Mufti suggests.
“Sometimes you can have too much or conflicting information, and it doesn’t always provide a clear direction on what to do. I think what the Smith School of Business Executive Survey results are showing is that business leaders are concerned about data paralysis and realize that sometimes – for certain types of management challenges – quick decisions are critical to an organization’s success.”
Some of the reasons behind leaders’ distrust of data are fears of inaccuracy and a lack of expertise and tools to properly interpret them.