We all see stats and we draw comparisons between them. This thing happened after that thing so it happened because of it.
- Elon Musk is going to Mars. We’ll all want to go to Mars.
- Italy’s birth rate is dropping. China’s is rising.
- Ice cream sales rise at the same time as drownings in the sea rise.
Context is everything. Endogeneity is the term given to drawing a conclusion that probably isn’t connected. Right cause and wrong effect.
Do you want to know why ice cream sales and drownings rise at the same time? Not because Granny was right and you shouldn’t swim straight after eating (although that may be true), or because ice cream and salt water don’t mix. No, it’s because it’s summer.
Interpreting data has always been an art and finding the patterns that mean anything at all is getting harder. Again, not because we aren’t all as good at it as we used to be. It’s because the data is everywhere and there is so much of it.
Maybe an answer is to go techno and buy in some machine learning capacity. Otherwise, maybe we can look through the right lens or take the right guide along the journey.
Cause and effect. room44 and innovation strategy.