Skip to content

Data Bias Is Becoming A Massive Problem

2017 November 22
tags:
by Greg Satell

Nobody sets out to be biased, but it’s harder to avoid than you would think. Wikipedia lists over 100 documented biases from authority bias and confirmation bias to the Semmelweis effect, we have an enormous tendency to let things other than the facts to affect our judgments. We all, as much as we hate to admit it, are vulnerable.

Machines, even virtual ones, have biases too. They are designed, necessarily, to favor some kinds of data over others. Unfortunately, we rarely question the judgments of mathematical models and, in many cases, their biases can pervade and distort operational reality, creating unintended consequences that are hard to undo.

What makes data bias so damaging is that we are mostly unaware of it. We assume that data and analytics are objective, but that’s almost never the case. Our machines are, for better or worse, extensions of ourselves and inherit our subjective judgments. As data and analytics become a core component of our decision making, we need to be far more careful.

read more…

You Can Never Build The Future By Looking To The Past

2017 November 19
by Greg Satell

“The biggest change you are going to see over the next year is that we want to bring our toy stores to life,” newly minted Toys R Us CEO Dave Brandon told a reporter a little over a year ago. “I want kids to be dragging their parents to our stores because they want to see what’s going on at Toys R Us this weekend.”

The sentiment seems eerily similar to former Blockbuster CEO Jim Keyes’ “Rock the Block” strategy and his assertion that “As long as we change the product assortment to meet the changing needs of the customer, our stores will remain relevant.” Much like Blockbuster, Toys R Us recently filed for bankruptcy.

When a business gets into trouble, the first impulse is often to improve operations. That can be a good idea, because improving business fundamentals can improve performance. Yet it also fails to take into account that there is a essential trade-off between optimization and innovation. To beat disruption, you need to explore and experiment to find something new.

read more…

Every Business Today Needs To Prepare For An AI-Driven World. Here’s How:

2017 November 15
by Greg Satell

In the late 1960s and early 70s, the first computer-aided design (CAD) software packages began to appear. Initially, they were mostly used for high-end engineering tasks, but as they got cheaper and simpler to use, they became a basic tool to automate the work of engineers and architects.

According to a certain logic, with so much of the heavy work being shifted to machines, a lot of engineers and architects must have been put out of work, but in fact just the opposite happened. There are far more of them today than 20 years ago and employment in the sector is supposed to grow another 7% by 2024.

Still, while the dystopian visions of robots taking our jobs are almost certainly overblown, Josh Sutton, Global Head, Data & Artificial Intelligence at Publicis.Sapient, sees significant disruption ahead. Unlike the fairly narrow effect of CAD software, AI will transform every industry and not every organization will be able to make the shift. The time to prepare is now.

read more…

Yes, The Inmates Really Do Run The Asylum

2017 November 12
by Greg Satell

At a recent NFL meeting about the anthem protests, Houston Texans owner Robert McNair warned his fellow owners that the league should avoid having “inmates running the prison.” Besides mangling the common phrase about “inmates running the asylum,” the racial undertones of the comment caused an uproar.

McNair quickly apologized and explained that he wasn’t referring to players, but league staff who he felt were making decisions without adequately consulting owners. Still, leaving political and moral issues aside, McNair’s comment raises important issues about governance in an increasingly complex world.

As Moisés Naím pointed out in The End of Power, today “power is easier to get but harder to use or keep.” So leaders are faced with a significant challenge. How to guide and shape an organization in an age of diminished power? The answer, unfortunately for McNair, is to acknowledge that the inmates really do run the asylum and leverage new sources of power.

read more…

Don’t Be Fooled By These 3 Overhyped Trends

2017 November 8

The Gartner Hype Cycle shows a remarkably consistent pattern. A new technology is first ignored, then begins to show promise and expectations get inflated beyond any realistic assessment of value. That leads to disillusionment and the technology is almost forgotten until, some years later, it begins to make a true competitive impact.

What makes the Hype Cycle so pervasive is that it is, essentially, a pattern based on our obsession with patterns and stories, which is so universal that there is a whole branch of mathematics devoted to it. Our love of patterns is so great, in fact, that once we notice one we are often unable to disregard it.

The concept isn’t limited to the technologies Gartner follows. At any given time there are a variety of trends and business ideas getting hyped. That’s a problem because an enormous amount of time and energy is wasted when a trend is at maximum hype. Right now there are three major trends you need to watch out for if you don’t want to get caught in the cycle.

read more…

To Solve Complex Problems, You Need A Networked Solution

2017 November 5
by Greg Satell

Every leader tries to keep things simple and predictable. You hire good people, treat them well, give them clear objectives and do your best to stay out of their way. If you do your homework, plan things well and your people execute efficiently, everything should go off without a hitch. Or so the thinking goes.

Yet reality often intrudes on even the best laid plans. Technology evolves, customer tastes change and competitors release new offerings. Before you know it, your simple model becomes dizzyingly complex and your organization is struggling to coordinate a response to a rapidly changing marketplace.

The truth is that we need to manage for complexity, not simplicity and many organizations are poorly fit to adapt. The answer does not lie in better planning or execution, but greater empowerment. We need to shift our organizations from hierarchies to networks and learn how to facilitate horizontal connections across the enterprise at an operational cadence.

read more…

4 Things Leaders Need To Close The Gap Between Aspiration And Innovation

2017 November 1
by Greg Satell

A recent McKinsey report found that while 84% of corporate executives think that innovation is key to achieving growth objectives, only 6% are satisfied with the innovation performance of their firm. That’s quite a mismatch and it’s hard to imagine that a success rate that low would be tolerated in any other business function.

One reason for the paltry performance is that while other business areas, like marketing or finance, are considered to be core functions, innovation is often considered to be something that’s “nice to have” rather than essential. Yet another more pervasive reason is that senior executives are trained as operators, not innovators.

There’s a fundamental conflict between innovation and optimizing an existing operation. While the execution of a conventional strategy lends itself to linear progress and clear benchmarks, innovation often proceeds by s-curves, moving at a slow crawl until it explodes at an exponential rate. To close the gap, we need to treat innovation differently than we do normal operations. Here are four things that leaders need to do to close the gap.

read more…

Here’s How You Know Your Industry Is About To Be Disrupted

2017 October 29
tags:
by Greg Satell

On a recent episode of Last Week Tonight, John Oliver pointed out the dangers of corporate consolidation. In a variety of industries today, ranging from airlines to healthcare to even buying a coffin for a funeral, a handful of major players dominate, which allows them to raise prices and restrict consumer choice.

Anybody who has flown on an airplane in recent years knows what he’s talking about. The once reeling industry now charges more and delivers less, but is reaping record profits, despite its horrific service. As Oliver pointed out, United posted strong results even after its notorious passenger dragging scandal.

Clearly, we have a problem with antitrust regulation and consumer protection, but corporate consolidation is more than an example of corporate greed, it is also an indication of industry weakness. Growing industries generally don’t consolidate and, by restricting competition, firms in oligopoly markets often hasten their own disruption and demise.

read more…

3 Simple Things You Can Do To Improve Data Security and Performance

2017 October 25
tags:
by Greg Satell

The recent Equifax data breach was unusual for its scale — nearly 150 million accounts were affected — but the basic story is nothing new. Massive data breaches have been happening at a record pace. Just one security flaw in one piece of software can put an entire enterprise at risk. Everybody is vulnerable.

The European Union has responded to the problem with its upcoming General Data Protection Regulation (GDPR), which will help minimize the risk and impose stiff penalties — up to 4% of global turnover— for organizations that don’t comply. Firms with EU exposure are scrambling to prepare for its 2018 starting date.

Most companies see GDPR as a burden, but Kenneth Sanford, an analytics expert at Dataiku, sees it as a blueprint for better data practices. While regulation won’t stop the breaches, it will help prevent the damage that they cause. With data and analytics becoming so central to how we do business, it’s time that we start taking it more seriously. Here’s what you can do:

read more…

The Platform Fallacy

2017 October 22
tags:
by Greg Satell

It seems like every business discussion today is just counting the seconds before the term “platform” comes up. Books and articles are written, pundits swoon and conference audiences nod and exchange glances in knowing agreement. Everyone, it seems, wants to transform their business into a platform.

Yet take the argument to its logical conclusion and the message becomes problematic. Platforms, as many have observed, function as multi-sided markets and therefore must connect value to value. So if everybody becomes a platform, who actually creates the value to make a vibrant marketplace?

The truth is that, while some amazing platform businesses have been created, there is also a considerable amount of survivorship bias going on. We notice the Amazons, Ubers and AirBnB’s, but forget about the thousands of platform startups that failed. Make no mistake, even in an increasingly networked world, you still need to create, deliver and capture value.

read more…