The following summary was written by Frank Voisin, who regularly writes for Frankly Speaking. Recently, Frank sold four restaurants and returned to school to complete a combined LLB/MBA.Analytics is about relationships. When we make decisions with our gut (AKA Intuition or Common Sense), we are really using a complex set of relationships we have formed in our minds over our lifetimes (and partially through genetic hand-me-downs). This may work for knowing “RUN!” when we see a rabid dog running toward us with teeth exposed, but when it comes to finding the optimal solution for distributing newspapers from three different points of supply to thirty different distribution points, taking into account transportation costs, relative production efficiencies and a host of other variables, it turns out that our brains are not up to the task. This is where analytics comes in through the use of different scientific methods for extracting the true nature of the relationships between things, so as to find the optimal solutions.
“It is difficult to get a man to understand something when his salary depends on his not understanding it.” - Upton Sinclair
Unfortunately, analytics doesn’t play a large enough role in decision making. Too often, the old guard has been founded on its “expert” opinion-making abilities. Wine and art critics feel scientific methods can never do what they do, let alone better. Though the proof is in the pudding: Orley Ashenfelter has proven to be more accurate with his scientific analysis of wines than Robert Parker’s “expert” senses, and Bill James proved better at picking baseball players than major league scouts, each determined on objective standards.
Experience and Intuition are losing out to analytics, and we seem to be on the cusp of major change. In the future, these techniques will become increasingly important, and so it is a valuable book to learn about the power of analytics and how it can help you do everything you do!
On to the rest of the chapters!