Micromanaging data is something that has been happening forever, but it often goes unnoticed and/or ignored because it seems normal. This is especially true today, given the number of software applications designed to collect, crunch, and visualize endless amounts of data for businesses.
This has unfortunately led to a culture where employees are given arbitrary metrics as goals that don’t actually reflect their contributions to the team or their real-world results. In fact, many Key Performance Indicators (KPIs) are entirely fabricated out of thin air and some employees don’t have control over the factors that generate the numbers used to measure their progress.
It’s not just KPIs that are the problem. Many business owners are overwhelmed by the vast amount of data they can collect through the applications they use to run their businesses. Not knowing any better, they attempt to make full use of these capabilities and end up wasting their time collecting data that doesn’t matter.
In other words, we have become obsessed with collecting and micromanaging data – whether or not that data is actually useful and relevant.
Not all data is useful
Just because you can collect 1,000 data points doesn’t mean you should. For example, if you are using email marketing, you can collect an infinite amount of data on your market by asking them follow-up questions in future emails for years if you want. Each time someone clicks on a link, they self-identify with another data point, and you can learn a whole lot about your subscribers. However, none of that data is useful if you don’t plan to use it in future marketing efforts.
For instance, say you collect enough data to profile your market as females aged 20-35 who drink coffee and have 2 children and at least one dog. That’s great, but unless you use that information to tailor your marketing efforts to that specific demographic, all of the data you’ve collected is useless.
It’s also common for business owners to collect data that can’t really be used for marketing or any other real purpose just because their software makes it possible. Many business owners are distracted by the ability to generate detailed reports from all the data they collect. Although, some reports directly contribute to the success of a business.
For instance, fleet managers need to keep detailed records regarding warranties and work orders. Knowing what parts are covered under the warranty is essential for making decisions that maximize company profits. Many fleet managers end up saving thousands of dollars by tracking warranties. However, not all data is equally useful. In fact, sometimes, data can give you an inaccurate perception of your business.
Data regarding failures can be deceptive
If you collect data regarding failures, it’s hard, if not impossible, to avoid attribution error. For example, Amazon happens to collect a large amount of data regarding employee performance and employees often suffer because of attribution error.
This article explains the situation quite well. Attribution error is when the responsibility for failure is placed on internal behavior rather than external circumstances. Instead of recognizing that sometimes tools may not work, someone’s spouse may have died, or someone was sick, the data regarding failures are attributed to a person failing because they were lazy or incompetent.
This shows how easily data can be manipulated to form conclusions that may not be accurate. While data is important for making business decisions, it doesn’t tell the whole story. It doesn’t tell you why certain things are failing.
Unfortunately, many business owners don’t realize that often, the problems lie with their tools and systems, like bad software applications and inefficient protocols. Employees are often stuck following rules and regulations that set them back and prevent them from getting their work done.
Data is good in moderation
At the end of the day, if you’re spending a lot of time and resources crunching data, you’re probably wasting your energy. How much of the data you collect gets used? Do you even give that data to specific teams to use for their decision-making processes? Or do you just collect data, look at the reports, and file it away as “information?”
If you’re using the data you currently collect, that’s great. If not, try to cut back and only collect data you plan to use. If you’re not ready to use it, you can still collect it. Simply have a plan in place so that you’re not just amassing information for the sake of using all the features your software has to offer.
Your time and energy are better spent on tasks that will directly support your business.
