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From time immemorial, we have witnessed the battles of the sexes and the battles of the hues.

In the 21^st Century, a new –ism emerges: the Battle of the Q’s.

Qualitative or Quantitative? EQ or IQ? Paper or Plastic?

People often ask me, “Gregory, you have a Bachelor’s degree in Comparative Literature from [the University of California] Berkeley, correct?”

I respond in the affirmative.

“Then tell me,” they continue. “How could you do so well at data analysis for the MBA at Santa Clara University?” [I have a general MBA but mostly excelled at analytics].

For those who (understandably) cannot read tones from a text (a facet of a Literature major), their tone is quite skeptical. My current tone is livid.

You might guess my source of fury lies within these:

• Anyone who knows anything about Cal (my beloved undergrad alma mater) knows that being admitted in the year 2000 required an insane amount of well-roundedness. My then pot belly aside, both integrating literary tropes and integrating continuous functions were a must.
• Cal and my teachers’ assessments were not alone. I have consistently scored highly in both Q’s across the SAT, ACT, GRE (slacked off slightly then), and the GMAT (if you’re a Type A personality, my scores are published on my LinkedIn profile). The metrics are on my side.
• As a data analyst, my personal mission is to dispel the confusion between “because of” and “in spite of.” My critical reading and free-fall thinking leveraged me above most rote-thinking engineers at their own game. Fields can be pie-expanding rather than pie-slicing.

Mental Segregation is as Ignorant as any Other Segregation

The belief that one can only be good at 1 or 2 things is completely backwards. Yes, we do learn some fields faster than others, and tradeoffs exist. However, polymaths exist, too. Centuries ago, the Greek word phusis (from which we have “physics”) meant “nature” without any distinction between mechanical nature or human nature. The word dilettante, now considered pejorative (it is synonymous with “amateur”), was once considered classy because only the wealthy could afford to acquire tutelage in multiple fields while most folk learned 1 trade through apprenticeship.

The tendency to pigeonhole a person’s skill sets not only displays empirical ignorance but also reveals a self-weakness. In psychology, there is a concept called projection: “If I can’t do it, I assume by default that you cannot, either.” I find that those who narrowly categorize others might be very parochial in terms of their own self-efficacy.

Mental Segregation Leads to Real Segregation, Even by Gender and Race

• Kobe Bryant and many African-Americans are above-average polyglots. Shall we assume by default they must be bad at math? Ridiculous! What genetic argument supports that? Sickle-cell anemia is one thing; Mathanemia is another.
• Women have proven excellent at humanities and historically have not outperformed men at quantitative fields until recently, some think. Ridiculous! Ada Lovelace (a woman) wrote the first computing code in 1842.
• Men possess the assertive upbringing needed to make effective salespeople. Ridiculous! Women comprise the majority of buyers today! A savvy manager should hire those who best win a female buyer, possibly women? Most of my past clients to date were women (in a theoretically male-dominated market, mind you), and I don’t think I won them over by sheer sex appeal…
• “Asian-Americans belong in IT or Finance.” Ridiculous! Jack Ma, founder of Alibaba Group and now the richest man in China (granted, he’s not Asian-American, but…) was an English major and later English teacher. He later learned business skills and created his empire. Up to 2010, he never wrote a line of code. Now if someone in so-called restrictive China could make that kind of career, how much more an Asian-American in the “land of the free!”

We have to stop believing that a member of any so-called faction can only be good at one thing and that excelling in one field necessarily crowds out another.

Glass Ceilings, Glass Walls, and Now, Glass Desks

I’ll assume that you already know what a glass ceiling is (and not that your expertise elsewhere has prevented you from knowing this term).

In more recent years, business experts including famous consultant Alan Weiss (i.e. author of Million Dollar Consulting famous) observed that “glass walls” were a much greater threat. In a 2011 article in Human Resource Executive Online, Weiss writes that women and minorities have been placed into HR and “interstitial” departments as a mere guise of diversity, since management is reluctant to represent them in more central or frontline roles. Although NWONMs (Nonwhite Or Nonmales) can be promoted upwards to VP of HR, the honor is as utile as Robert Frost’s honorary doctorates (HR execs rarely ever become CEOs at Fortune 500 companies). Given Weiss’ long history of being very harsh (and very accurate) about HR, it means something when an HR publication actually publishes this.

I think we face a new problem with Glass Desks, with which we believe we are free to walk about a room but are actually compelled to sit and handle a specific task-set.

Shattering the Glass Desks

• Only engineers should be involved in design? Have we learned nothing from Steve Jobs?
• Extensive auto industry experience needed for success in Detroit? Alan Mulally, recently retired CEO of Ford, came from a lifetime at Boeing only several years prior. In spite of not knowing how to make the hottest cars himself, his leadership in the field was par for the course (in his tenure, Ford alone of the US major auto makers avoided the government bailout fund).
• Patricia Fripp, the world’s greatest authority on public speaking, started out as a hairstylist. Speaking was originally a peripheral opportunity to promote business until she found both passion and excellence at the National Speakers Association and became its first female President.

(Over)specialization is the hallmark of a mature (old) company. Startups (young) require many hats for each person. While tradition says that a startup ceases to be a startup when it is acquired, I believe that startup ceases to be when its members ossify and “fuse their ends” (close bone growth) into departments and lose that cross-functional flavor.

Google is now the #1 brand in the world (yes, someone had to finally beat Coca-Cola). Google is also considered “amorphous.” Coincidence? I think not. It has no bone growth end. It is not calcified (yet). There is likely more freeflow than we think.

We need Mental Integration, not Mental Segregation. Scientists have recently dispelled the utter BS we call “left-brain / right-brain.” We have 1 brain and do not function with a split personality.

Kampai!

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“Half the leaders I meet don’t need to learn what to do. They need to learn what to stop.”

-Peter F. Drucker

Chris, a sales representative, asks you for advice on how he can close higher revenues for the rest of the year. He sells health food and exercise equipment. He is also quite portly (don’t ask how he was hired – long story).

As an analyst, you believe that prospects would more likely buy from a healthy sales rep, all else equal. Your market research data also indicate that Chris has not yet done sales calls with a few high opportunity prospects in his territory because the decision-makers have tough spec requirements. Tailoring the presentation materials and offerings would require some new skills on Chris’ part before he visits them.

Do you, between 2 mutually exclusive options, choose to:

A) Tell Chris he needs to learn how to integrate these new specs and concerns into his sales presentation. The time investment is 100 hours and should get $30,000 Net Present Value (the higher, the better) from selling to these big buyers.

OR

B) Tell Chris to stop eating so much and exercise. The time investment is 100 hours and should get $30,000 Net Present Value from higher closing rates with all buyers.

If you are an analyst, you probably picked A. If you picked B, I wonder how likely you’d actually tell someone like Chris that in real life!

Why Pick A?

I have rigged both options so that their economic costs and benefits are the same. Some of you may lean toward A because it makes you “sound smarter.” I think there’s a much bigger driver:

Telling people what to do seems positive and analytical (Do This), and telling people what to stop seems negative and confrontational (Stop That).

The advisor, whether average or absent-minded, has an incentive to tell people to “do more/new” because it might not hurt the ego. To tell people to stop means to negate prior decisions and ego, “I’ve been doing this for years. Are you telling me I don’t know how to run my life?!”

“The default response is never improvement but inertia.”

-Marshall Goldsmith, Mojo

WTD is Analytical. WTS is Attitude

We both know deep down according to stakeholder theory (i.e. being a respectful human being) that Option B is the right choice for Chris. His long-term health is an important peripheral (if not central) benefit. But since our own egos (or fears) get in the way, we have to stop being analysts here and start thinking like coaches (or giving Chris a referral to one).

360-degree Feedback Isn’t Crop Circles

One problem with being an analyst is that:

1. You’re usually the only advisor (will Chris even accept my feedback?) OR
2. If there are multiple analyst opinions, they are given in series, not in parallel (if I tell the truth, will the next person agree with me, or will the next person withhold to flatter, making me look bad?).

360-degree feedback’s benefits rely not so much on space (all key stakeholders around) but time (simultaneous, aggregated feedback requires anonymity to promote truth-telling). Chris could potentially knock down one critic at a time, but knocking down dozens of people at the same time is not so likely (such is the power of normative pressure).

Here, a coach employs confidential feedback from multiple stakeholders to inform Chris about his weight problem and the benefits of changing. Once Chris has buy-in, he can begin his diet.

Sometimes in order to help the most, we have to stop thinking like analysts (the power of information) and think like coaches (the power of key people).

L’chaim!

Welcome to the White Wine Papers! Please Enjoy Gregory’s Most Aromatic (Or Intoxicating) Thoughts About Business Analysis.

When the Outhouse Stinks Less Than Inhouse

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The outhouse, or zero-flush facility as I call it, works wonders for your water bill but not for your nose. Most North American and European households prefer the indoor flush toilets for closer proximity and cleaner fragrance. Not surprisingly, most firms also prefer in-house business analysts for similar reasons (including taking crap).

Although external analysts or consultants have already been frequently contracted for their special skills (or for employers to avoid paying fringe benefits), I believe that as Big Data continues its avalanching growth, a conflict of interest will wedge a gaping rift between the in-house analyst and the manager.

Leading IT firm CSC forecasts, “Data production will be 44 times greater in 2020 than it was in 2009,” (csc.com) and states, “Enterprises [currently] store 80 percent” of all data (ibid).

Managers have great incentive to exploit that 80%, but their direct reports face a dilemma that is all too familiar in my experience:

“What if the data reveal that everything my boss believes is completely wrong?!” [*yes, the word “data” is plural; “datum” is singular]

It is only natural that the boss, an expert of common sense and experience, would be opposed by largely counterintuitive data (if the data were usually consistent with common sense, then investing in Big Data would frankly be a redundant waste of money).

Although more savvy managers are apt to keep an open mind, the stereotypical manager is still the victim (or rather, the perpetrator) of escalated commitment: the desire to stay on the original path in spite of overwhelmingly conflicting data. Yes, I know that doughnut is bad for my health – now let me eat it in peace!

Every in-house analyst faces at least 3 possible problems:

1. “I’m not sure I conducted the analysis at a professional/research/conscious level.” Most linear regression reports I read do not account for control variables, which is heretical.
2. “I’m sure I’m 100% right and thought of every possible outcome.” Not only is this arrogant and ridiculous, but most analysts with this attitude were not even in the top 20% of their class.
3. “My boss believes our company will profit the most from an aggressive price-cut, but the data indicate we would profit the most from a 20% price increase while risking a 10% drop in sales volume. However, his bonus is based on volume production, and his pay will be cut if he heeds my advice.” Is there really any analyst so altruistic as to risk his/her job for the sake of the company? [Can count them on fingers…]

No matter how skillful an in-house analyst becomes, there will always be the human element, the meat that comes with the machine. The ability to either confront or persuade a manager with an opposing opinion is not necessarily innate with the position (it is a mix of immutable, inborn personality and behavioral training). Naturally, the possibility of being fired is an ever-present smother for the analysts’ fire.

External analysts will be in greater demand because they are more resistant to this dilemma. Although an irate client can cancel the fee, good consultants possess more candor because they can easily find work elsewhere (and great consultants get paid ahead of time, which quashes the client’s incentive to get mad).

Are external analysts just better people? Of course not. Their different financial situations create the difference. Many in-house analysts are jumping on the trend to go independent to give more independent advice. MBO Partners “projects that 1 in 2 American workers will either move to independent work or spend at least part of their working hours as self-employed professionals by 2020” (The Future of Work: Preparing for Independence, a Survey, MBO Partners, April 2014).

If you are a manager seeking the most unbiased input to get the best results, you might find that the outhouse will ironically contain a lot less…waste…than the in-house. Salut!