When Facts Aren’t Enough: Making Wise Business Decisions
A computer programmer argues that good business decisions require not just information, but analysis and responsibility. These together lead to wise and sensible decisions.
Information = data or facts.
Understanding = a grasp of the meaning (significance) of data.
Knowledge = certainty of data. (Knowledge is only as valid as the
data on which it is based).
1) the proper evaluation of the relative importances of data
2) knowing what data to use and how/when it should be used
3) the relationship of data to the greatest good
The application of wisdom involves responsibility.
Responsibility = a willingness to do, or not do, a given thing and
the willingness to be accountable for the results
of doing or not doing that given thing.
Wisdom and responsibility are necessarily companions.
Clearly data alone is not enough. Once you confirm the data, you must understand it. When you fully
grasp it, it can be called knowledge. Then you must assess its relative
importance along with other data must be assessed. The
final step is how it relates to the greatest good, or
survival, within its context.
Your accountant tells you that you can improve your
bottom line by $200,000 a year if you lay off the four
most senior staff, replacing them with recent graduates.
— This is data.
You review the data (salaries, benefits, etc.) and find
that it is true. You do the math and understand how it
would work, and you are certain of it.
— Now it’s knowledge.
You understand the relative importance of improved profits
for the stockholders and the personal bonus benefits you
However, you also know how firing your four top guys will
impact the morale of the remaining staff. You know from
experience that they will feel less loyalty and be less
productive, costing you, in the end, more than the savings.
You also remember that you promised your people that they
would benefit when the company did.
You evaluate the good/bad effects in a wide enough scope
to appreciate the short and long term results of the
— Now you’re applying wisdom.
You decide to thank your accountant for his assessment,
keep your top four guys, publish a commendation and raise
for them, and write a memo to your senior Vice President
for Organizational Efficiency, asking him to examine the
work flow for places to save wasted motion to improve
— Wisdom applied with responsibility.
A final note:
“knowledge” is not always static. Certain data will
always be true, others will change with the growth of
such things as population or technology. Renew your
knowledge from time to time.
Garry Hamilton is a Consulting Programmer in assembly, C, and
database languages, for platforms from CP/M and DOS to Windows
and UNIX (alright, so that’s 18 years). Current work includes
a terabyte data warehouse and paperless enterprise applications.
Other disciplines: business communication and organization.