What Goes Into Making Critical Decisions?
Taming Big Data [Source: https://www.youtube.com/watch?v=hu8x2iBw6V4]
Crowd-sourcing is revolutionizing the world of decision-making. From personal decisions outsourced to family and friends ("Does this dress make me look fat?") to corporate decisions that determine the shape new products will take, (Presenting prototypes to customers for their reactions, and then going to production.) crowd-sourcing it lighting the path ahead.
But new research points to a related phenomenon that some enterprises are only now seeing as a risk to their ability to make critical decisions: crowd rule. That's right - the same types of crowds that are a boon to that product manager can mire the organization in a sea of Big Data to such an extent that the company becomes nearly paralyzed in its efforts to take decisive actions.
There's even a story, about one of the world's best-known search engines, that has taken on the status of urban legend. This company had become so reliant on optimization technology that it tested everything with consumers. The belief here is that the larger the sample size, the more optimal the results. But the methodology came to be questioned by at least one executive at the search engine when an A/B test (an optimization technique in which two versions of the same web site are voted on) got stuck on what shade of blue the company should use in its online designs. The executive resigned when he realized that the company was extensively testing the web performance of no less than 40 shades of blue.
Sometimes, Big Data, on its own, has the capacity to become incredibly big without any sort of end game. Companies need to utilize data in such a way that it enables accuracy in its decision-making. When the vastness of a sample size, or the repetitive nature of a sampling (like testing 40 shades of blue to determine which is optimal) becomes an end in and of itself, then an enterprise should wonder if the cyberspace crowd is more accurate than even one or two of its in-house experts.
A recent study by MIT shows that some 15 percent of the world's top 10,000 web sites utilize A/B testing technology in an effort to harness the power of crowds. Some online enterprises prided themselves on a culture of innovation that included vigorous debate over how to present certain information on its web pages. But now those debates have taken a back-seat to endless statistical testing that validates itself... but not necessarily the outcome of the page presentations.
The question enterprises are now asking themselves, therefore, is how to make Big Data work for them. The growing reliance on reams of data to make critical decisions for the organization is getting the scrutiny it deserves. What new research is demonstrating is how a scientific method that utilizes Big Data, but isn't subservient to it, is best to ensure accuracy that's needed in an enterprise's make-or-break decisions. That's because such methodology includes the creativity and innovative spirit born of the organization as well.