The more data, less understanding paradox: why data-based decision-making is a major challenge

Posted by Guest Blog on February 12, 2021

TwitterTweet it:'We live in the golden age of information production. Digitalisation has made it possible to efficiently collect, store and access data in ways previously unimaginable'

We live in the golden age of information production. Digitalisation has made it possible to efficiently collect, store and access data in ways previously unimaginable. The time-consuming era of collecting, storing and accessing information in the form of hard copies is becoming an increasingly distant memory.

In 2021 we take for granted the fact that data covering an incredibly wide range of subjects can quickly be accessed at our fingertips. Everything from important details regarding global living conditions through Worldbank data, to the different impressions of a new ice cream flavour can all be charted by analysing the millions of conversations happening online.

But at the same time as data is more abundant than ever, we are failing to harness the full potential of information at our disposal. Many companies still don’t collect the data at their fingertips, many more don’t analyse or act upon it. Just because data is now much more accessible, it doesn’t mean it is being profited upon and used to enable the benefits of a more data-driven decision making process.

In many ways, that’s natural: the human brain is not programmed to seek data to inform decision-making. Focusing solely on the physical challenge in front of us has enabled humans to prosper and survive for hundreds of thousands of years. The information age, on the other hand, has only been in progress for a matter of decades. So while the technology we have created has made huge leaps in the area of data collection and analysis, our own natural way of thinking remains a major roadblock and prevents us from harnessing it. Our slow pace of adaptation is not a friend in trying to clear that hurdle.


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There are a number of ways the human mind makes this process challenging. Not least association – when the brain draws conclusions based on our limited, anecdotal previous experiences – which naturally drives human decision-making, rather than analysis of objective data. Combine that natural wiring with cognitive biases, the way the framing of information influences our judgement to the extent we deviate from rational objectivity, a process designed to help us make instant decisions, and the potential for misjudgment is huge.

We know we have a mental battle on our hands to try and be more fact driven and make decisions influenced by data, so what can we do to try and close the gap?

Firstly, we need to understand that having access to data doesn’t help make our decisions data driven, rather, it’s using that data in the right way that will make the difference. Raw data in particular is seldom the solution, and having access to it means little without the context necessary to explain it.

Secondly, we need adequate tools that can present the data in its appropriate context and visually display it in a way that facilitates proper use and understanding. And that does not mean a standard Excel spreadsheet filled with so many numbers our head begins to hurt. That’s a guaranteed way to overwhelm and cause misunderstanding, but unfortunately remains one of the most common methods of presenting data.

Thirdly, just because we can access data it doesn’t mean we should use it. Not all data is of huge relevance to every decision, so it is necessary to learn how to better filter and prioritise the data at our disposal.

Finally, we should always keep in mind that one isolated data point is not enough to draw major conclusions from – there are likely several other data points that challenge or add nuance to it. It is important therefore to use a range of tools that allow us to add context to the data we plan to base our decisions on, whether that is a historical comparison, or a comparison to similar, related data sets. Keep all of this top of mind, and we will be on the path to achieving a more data-based form of decision making.

Find out more about the benefits of data driven decision making by watching our on demand webinar with Olof, Base Your Business Decisions On Facts, Not Guesswork.


About the Author

Olof Gränström is a lecturer, political scientist, historian and business economist. He has previously worked as an organisational educator and developer, and as an expert at the Swedish university. Olof’s experience also includes working with the foundation Gapminder, founded by Hans Rosling.