Why use data analytics?

How much should leaders of businesses, charities or professional services firms rely on their instinct to make decisions? How confident should they be that what they think is happening in their business is what is really happening? Do they truly know how their customers, clients or donors are behaving? Or how effective their online marketing campaigns are or how well their staff are performing?

If you are relying purely on intuition and experience to make decisions, the chances are that you are doing so without having the complete picture. The best approach to business decision making is to combine instinct and data. After all, wouldn’t you rather have a feeling about something and have your instinct confirmed by evidence than have a feeling about something but not be totally sure?

That’s the difference between running your business on instinct alone and running it with instinct plus data.

Human intuition has its place, but numerous human behavioural tests have proved that intuition can be flawed. Try the quick tests below to see how accurate your intuition is.

And remember, “big data” is no longer the exclusive domain of large corporates. Any business of any size can use data to give them an edge over their competitors, without spending a fortune.

The thing I have noticed is when the (customer) anecdotes and the data disagree, the anecdotes are usually right. There’s something wrong with the way you are measuring it
Jeff Bezos, founder of Amazon





How accurate is your intuition?

Try these four quick tests and watch the cups video below to find out

Without a doubt, human intuition has a place in decision making. However, sometimes either our intuition can be wrong or a question can be put to us in such a way so as to lead us to the wrong conclusion.



  • Test 1

  • Test 2

  • Imagine that the UK is preparing for an outbreak of a disease that is expected to kill 600 people. Two alternative programmes to combat the disease have been proposed.
    • If programme A is adopted, 200 people will be saved.
    • If program B is adopted, there is a 1/3 probability that 600 people will be saved and a 2/3 probability that no people will be saved.
  • Imagine that the UK is preparing for an outbreak of a disease that is expected to kill 600 people. Two alternative programmes to combat the disease have been proposed.
    • If programme A is adopted, 400 people will die.
    • If programme B is adopted, there is a 1/3 probability that nobody will die and a 2/3 probability that 600 will die.


Test 3

Many businesses make decisions using intuition, rather than by looking at cold, hard data. This can be fine at times but often it is a mistake. Take this test to find out how accurate your intuition is.

As you can see, our perceptions can be biased depending on how something is presented. Similarly, the way an organisation interacts with its customers (for example, the way products and services are marketed, communicated, or placed), can make an enormous difference.

What this video shows is that people can focus so hard on one particular thing (so say one or two aspects of their business), that they can’t see something unexpected, even though it is right in front of them. Again, data analytics takes this problem away.

Test 4

A bat and ball cost £1.10 in total. The bat costs £1.00 more than the ball. How much does the ball cost?

The ball costs 5p. The bat costs £1.05 i.e. £1 more than the ball.

Most people’s instinctive answer is that the ball costs 10p and the bat costs £1 so if you gave this answer you are not alone!

Watch the cups video below to see how the brain can be tricked into buying less for more