There are a couple of ways to examine your business, but most leaders lean towards key performance indicators or metrics. This makes sense since it is knowledge that is measurable and explicit; it can easily be explained, emulated, shared, and understood.
It would then reason to follow that the more data you have, the more likely it is that your business will reach targets and succeed.
And these days, data in business is more robust than ever. People analytics have become all the rage for decisions regarding hiring, firing, and development. It’s the same level of data that hardline front managers and executives use to make bottom-line decisions.
It seems the old way of making decisions based on experience no longer computes.
With the explosion in popularity of explicit knowledge, we have inadvertently devalued our tacit knowledge. Tacit knowledge is that information that is more subtle, that is implied, that is impossible to impart on a person. Wisdom is a form of tacit knowledge. And while leaders need explicit knowledge, wisdom may be more valuable.
A wise leader will always consider context. Rather than blindly clinging to the latest leadership approach, a wise leader knows that contained in each success story is the context. There are approaches that are appropriate for one set of circumstances that may not apply to another set of circumstances.
We often skip over this and attempt to emulate the actions in our current landscape only to find that the “doing” of one leader doesn’t translate to the success of another. Unfortunately, data doesn’t consider context either; leaders must apply that to the data themselves.
Aristotle notes that there are two necessary ingredients for making decisions that can stand the test of time. First, we must use correct reasoning. Data can certainly help us do that. Second, we must have the right desires and the right means that support the good for one and all; this requires being knowledgeable and wise.
Leaders should regularly consider the following: What is the best knowledge to apply to this particular situation? Not only must we understand the situation, but we must also understand how to act on it appropriately and with the good of the company in mind.
And there is no amount of data that can help a leader with that.