Data is the weapon of modern businesses. Like a sword, it is only as useful as the person who wields it.
Although data can’t make decisions for you, if you’re tracking the right data, it provides you with information that must inform your decisions. To an entrepreneur, finding patterns in the data is nirvana. Market signal is embedded in the data: that which informs where you should direct your efforts, where not to, when to double down, and when to pivot.
But like a double-edged sword, data should not be brandished thoughtlessly, as careless use is potentially as risky to the entrepreneur as it is useful.
Most modern businesses, including startups, are inundated with data. This causes a couple of fundamental problems. First, many are reluctant to properly instrument their value stream—in other words, measure the effectiveness of business activities—for (a very legitimate) fear of merely increasing the speed at which they drown in data. This concern is not without foundation, since the second most prominent problem is successfully extracting useful knowledge from the data.
Baseball scout Grady: “Now there are intangibles that only baseball people understand. You’re discounting what scouts have done for 150 years.”
Billy Beane: “Adapt or die. [. . .] You don’t have a crystal ball. You can’t look at a kid and predict his future any more than I ...