Like many of you I am driven by data and measured with metrics for success in my job. This type of measurement is highly dependent on the ability to obtain “enough” data to make meaningful recommendations or decisions to present to management without over analyzing. But what is enough data? You may agree with me that it is not always about the amount of data but the right data and enough of it to provide directional information to make a decision.
For data minded people, our success relies on understanding what metric is the “ONE” that matters most that will tell our story and help us expose the right data that ultimately leads to the right decision. This viewpoint certainly will help you keep focused on the objective for a reporting assignment.
So I googled the question, how much data is good enough to make a decision and the answer is 37% according to Dr. Norman Chorn. Refer to this Linkedin post from Dr. Norman Chorn for details (Linkedin account required.)
In summary, Dr. Chorn referenced five misconceptions of gathering data
1: It is best to collect as much informations as possible and keep your options open
2: People make irrational decisions by not considering all the information
3: Experts make the best decisions
4: It is often best to rely on intuition when situations are complex
5: People use past evidence to judge the probability of a future event occurring
Dr. Chorn then goes into how to improve decision making and knowing what the optimal stopping point is when collecting data. There has been research in mathematics and statistics to determine that 37% is where “you have optimised the amount of information collected and the time taken to make a key decision.”
Let’s take a poll! I’m interested in hearing your thoughts. Is 37% enough for you to make a decision?