I thought of him the other day while watching my daughter's basketball practice. Samantha's dad had brought a storage box full of business reports. While his daughter worked up a sweat on the court, he worked up one of his own in the stands. I was curious.
He began by separating the reports into piles. Then he began going through them, occasionally making notations, and re-sorting them into other piles. By the time he finished, the biggest one by far was the discard pile. When he took a break, I asked him what he had been doing.
"Mostly looking at sales reports," he said. "By territory, by region, and overall company. By week, by month, by quarter, against plan, against the previous period and year-to-date, by item and by category."
"Does all this information help you?" I asked.
"Of course, I think. I suppose it's good to know how sales compare to the previous year. Lets you know when there's a problem."
"Does their data give you any insight on how your market is changing?"
"No, the reports kind of assume that everything's the same except for the sales numbers. If the numbers are bad, they tell me I have to fix something."
"Do the reports tell you what the problem might be?"
"No. I have to figure that out by myself."
"But you wouldn't know you had a problem without the reports, right?"
"Of course I would. I'd know that from the information I sent in so they could compile all their reports."
We watched a fast break drill in silence. But I had one more question. A moment later, I had to ask it.
"If none of this information gives you anything you can use, why do they send you so much of it?
He looked at me as if I were an utter idiot and patiently explained, "because that's the information they have."
I shouldn't have been surprised. I've seen this before. Another friend is fond of saying, "If you can measure it, you can manage it." A lot of like-minded people believe that information is good, and therefore more information is better. But their logic somehow escapes me.
I keep statistics for the basketball team, but not the obvious ones. There are some factors - plus/minus ratings and steal-to-turnover ratios for example, by player and by combinations of players - that give the coach views of the game he might not otherwise see. These insights help him to plan his practices and do an even better job of situational substitutions. The final score does not really help him. He needs to know what happens to make the scores come out as they do.
The same thought process holds for business. The tracking, reporting, and analysis of information are valid only to the degree that it offers insights beyond the obvious that can lead to meaningful action. Scorecards, by themselves, do not accomplish this.
Ideally, statistical reports are tools. As any handyman can attest, it doesn't matter how many tools you have. The real question is, do you have the right tool for the job? Samantha's dad's company does not realize this. They gave him all the data they could readily track - looking where the light is better rather than illuminating the hidden corners. And he, like so many of us, has to figure out the rest for himself.
| About the Author Michael Ponder works with the evolution of Internet commerce. He also has a long history of work with a variety of communications media, from print and video to live storytelling. For the past quarter century, Michael Ponder has been a student of, and pioneer in electronic communication as a business tool. His ideas often seem unconventional because they are built outward from the perspective of the individual receiving the message rather than starting from the perspective of the company sending it. He is a regular contributor to where it's @, the online resource for the MultiChannel Retailer found at www.MultiChannelRetailing.com. You can reach him at pondermj@aol.com.
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