{"id":12170,"date":"2010-11-10T17:00:46","date_gmt":"2010-11-10T16:00:46","guid":{"rendered":"http:\/\/timoelliott.com\/blog\/?p=2520"},"modified":"2010-11-10T17:00:46","modified_gmt":"2010-11-10T16:00:46","slug":"why-are-business-analytics-important-because-you-think-youre-a-better-than-average-driver","status":"publish","type":"post","link":"https:\/\/timoelliott.com\/blog\/2010\/11\/why-are-business-analytics-important-because-you-think-youre-a-better-than-average-driver.html","title":{"rendered":"Why Are Business Analytics Important? Because You Think You&#8217;re a Better Than Average Driver"},"content":{"rendered":"<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" style=\"display: inline; border: 0px;\" title=\"above-average-drivers-banner\" alt=\"above-average-drivers-banner\" src=\"https:\/\/i0.wp.com\/timoelliott.com\/blog\/wp-content\/uploads\/2010\/11\/aboveaveragedriversbanner.jpg?resize=690%2C300&#038;ssl=1\" width=\"690\" height=\"300\" border=\"0\" \/><\/p>\n<p><em>[Cross-posted from my <a title=\"Timo Elliott Forbes Business Analytics post\" href=\"Why are analytics important? Because 93% of us think we're better than average drivers. This cognitive bias means that we're overconfident in our decisions -- and hence under-invest in the business analytics systems, processes, and culture that can lead to fact-based decision making.\" target=\"_blank\">Forbes post<\/a>]<\/em><\/p>\n<p>You\u2019re probably worse at analyzing data than you think. That\u2019s the conclusion of wide-ranging \u201c<a href=\"http:\/\/en.wikipedia.org\/wiki\/Illusory_superiority\" target=\"_blank\">illusory superiority<\/a>\u201d research carried out by psychologists. Just as in <a href=\"http:\/\/en.wikipedia.org\/wiki\/Garrison_Keillor\">Garrison Keillor<\/a>&#8216;s fictional town <a href=\"http:\/\/en.wikipedia.org\/wiki\/Lake_Wobegon#The_Lake_Wobegon_effect\">Lake Wobegon<\/a>, \u201call the children are above average\u201d, we all think we\u2019re better than everybody else:<\/p>\n<ul>\n<li>93% of Americans think they have above-average driving skills<\/li>\n<li>87% of MBA students at Stanford University rated their academic performance as above the median<\/li>\n<li>68% of teachers In a survey of faculty at the University of Nebraska rated themselves in the top 25% for teaching ability<\/li>\n<\/ul>\n<p>When it comes to business analytics \u2013 using information to better-run your business \u2013 many successful executives have similarly high opinions of their skills.<\/p>\n<p>This cognitive bias means that we tend to be overconfident in our decisions &#8212; and hence under-invest in fact-based systems and processes that could help us correct our misperception.<\/p>\n<p>One key part of the solution is to share information and decision-making as widely as possible throughout the organization &#8212; using the &#8220;<a title=\"Wisdom of the Crowd\" href=\"http:\/\/en.wikipedia.org\/wiki\/The_Wisdom_of_Crowds\" target=\"_blank\">wisdom of the crowd<\/a>&#8221; to overcome any individual biases. The latest generation of &#8220;<a title=\"Business Intelligence\" href=\"One key part of the solution is to share information and decision-making as widely as possible throughout the organization -- using the &quot;wisdom of the crowd&quot; to overcome any individual biases.\" target=\"_blank\">business intelligence<\/a>&#8221; software can help provide a strategic framework for such information use throughout the organization.<\/p>\n<p>However, technology can only take you so far &#8212; to become a better-run business, leaders of organizations have to instill an &#8220;information culture&#8221; that rewards the systematic use of data in decision-making.<\/p>\n<p><a href=\"https:\/\/timoelliott.com\/blog\/2009\/02\/bad_decisions_just_blame_evolu.html\" target=\"_blank\">Click here for more information about decision bias<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why are analytics important? Because 93% of us think we&#8217;re better than average drivers. This cognitive bias means that we&#8217;re overconfident in our decisions &#8212; and hence under-invest in the business analytics systems, processes, and culture that can lead to fact-based decision making.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[100,198,204,262,592],"class_list":["post-12170","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-analytics","tag-business-analytics","tag-business-intelligence","tag-cognitive-bias","tag-illusory-superiority"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p3X9RF-3ai","_links":{"self":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/12170","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/comments?post=12170"}],"version-history":[{"count":0,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/12170\/revisions"}],"wp:attachment":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/media?parent=12170"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/categories?post=12170"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/tags?post=12170"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}