Numbers Lie: Focus Bias
Everyone hates bad news
Let’s all admit that we hate getting bad news. It is a lot easier to handle good news, especially first thing in the morning.
Bad news is not always as simple as “revenue is down”. Sometimes bad news is that you have yet another task to complete today when your todo list is already overflowing. There is only so much we can do in a given day, so many decisions we can make. This is why many organizations will focus on a few KPIs, metrics or customer segments that are important to them and largely ignore the rest. There are only so many numbers you can absorb and process.
However, this focus may exclude important data for decision making so I refer to it as Focus Bias (others call it “Tunnel Vision”). Focus Bias is dangerous for a few reasons:
- Too high level. KPIs are often very high level metrics and can hide changes and shifts going on in your business that are indicators of future problems.
- Businesses change. The assumptions and beliefs in your business that drive your focus one year may not hold true the following year. Businesses change over time and your focus may not keep up.
How do you avoid Focus Bias? The best way is to try to get outside of your metrics comfort zone as often as possible. Here are some tips:
- Every week… Make it a weekly habit to browse through data on customer segments and behaviors that are not on any of your dashboards. Data exploration is fun and can provide you with hints of hidden opportunities and problems.
- Every quarter… Ask yourself if your KPIs and metrics are still the best measurements of your business. Don’t keep them just for historical reasons, switch them out if there are better metrics!
- Every year… Ask yourself what you wish you had known the year before and do your best to fill any similar gaps in the coming year. You cannot make perfect decisions but you can always be better than you were.
You cannot look at every dimension of every metric of your business everyday without going insane. However, focusing on only a few metrics is just as dangerous!