Executive Briefings

In an Overly Complex World, Too Much Data Becomes an Obstacle in Itself

Lack of data is certainly not the cause today of so many disastrous business decisions. Indeed, company-wide ERP systems that give chief executives real-time access to all kinds of metrics can actually contribute to faulty decision-making: As more data is introduced, the number of contradictions that must be reconciled grows. There are limits to the amount of information the human brain can process in a reasonable manner. The chief executive is forced to accept some pieces of information and reject others -- and often selects, unconsciously, what supports a preliminary conclusion. In both business and personal affairs, we often make decisions without full awareness of how much intuition and emotions influence our choices.

Globalization and rapid-fire technology developments are forcing executives to make more decisions and deal with more complexity than ever before.  Offered more opportunities than they have resources available for pursuing them, executives can be tempted to develop too many projects, short-changing those with the highest potential. Yet focusing excessively on high-potential opportunities - a common practice -- also poses danger because these opportunities carry the highest risk of failure.

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Lack of data is certainly not the cause today of so many disastrous business decisions. Indeed, company-wide ERP systems that give chief executives real-time access to all kinds of metrics can actually contribute to faulty decision-making: As more data is introduced, the number of contradictions that must be reconciled grows. There are limits to the amount of information the human brain can process in a reasonable manner. The chief executive is forced to accept some pieces of information and reject others -- and often selects, unconsciously, what supports a preliminary conclusion. In both business and personal affairs, we often make decisions without full awareness of how much intuition and emotions influence our choices.

Globalization and rapid-fire technology developments are forcing executives to make more decisions and deal with more complexity than ever before.  Offered more opportunities than they have resources available for pursuing them, executives can be tempted to develop too many projects, short-changing those with the highest potential. Yet focusing excessively on high-potential opportunities - a common practice -- also poses danger because these opportunities carry the highest risk of failure.

Read Full Article