My thanks this month to Herb Meyer, my good friend and TEC resource specialist extraordinaire. He knows a little about gathering and analyzing information.
Herb served as special assistant to the director of the CIA during the Reagan administration and vice chairman of the CIA’s National Intelligence Council. Among his many accolades, he is credited with being the first U.S. government official to forecast the impending collapse of the Soviet Union, for which he was awarded the CIA’s highest honor, the U.S. National Intelligence Distinguished Service Medal.
Herb is one of the brightest guys I’ve ever met, and he has given me permission to synthesize his excellent article about how to analyze information. For the full report go to www.howtoanalyzeinformation.com.
Figuring out where you are
Imagine you’re driving toward Green Bay for an early morning meeting there, and you see a little light next to your fuel gauge indicating that you’re low on fuel. You’re running late for the meeting.
If you’re passing Appleton, you might conclude that you can continue driving to your meeting, and fill up afterward. If you’re passing Fond du Lac, you know you had better stop for gas.
The point is that until you know where you are, regardless of the simplicity or complexity of the question, you can’t make good use of the available information. Smart CEOs I know always ask, “Where are we?” They get an anchor point before moving to the second step.
Be sure you’re seeing clearly
Information is always a figment of our perceptions. Regardless of our good intentions, we tend to view it selectively, like we’re looking through a prism. If you’ve looked through a prism, you know that what you see is distorted.
Have you ever had a customer whom you never met, but had contacted by e-mail or phone over a long period of time? If so, you probably formed an impression of his or her looks, demeanor, etc. Then when you had your first face-to-face meeting, you were totally blown away. This is not what you expected at all!
The key here is to see information as clearly as possible without the interference of a prism to alter your perceptions and cause you to judge that information incorrectly and, hence, to your own disadvantage. Incidentally, Herb maintains that most decision-makers skip Steps 1 and 2 and begin at Step 3 – a big mistake.
Decide what you need to decide
Deciding what it is you really need to decide is a huge challenge for indecisive CEOs and senior executives. Frequently, this isn’t difficult if you know the three right questions to ask: First, if we do nothing, what will happen? Second, if we consider an alternative, what will happen? Third, if we wait and then act, what will happen?
Determine what you need to know
Once you’ve locked in on what you need to decide, you must collect information to support that decision. For instance, if you’ve decided to consider expanding your business overseas but haven’t nailed down a target market country, you’ll want to obtain information about market potential, demographics, competitors, taxes, import regulations, labor laws, etc. Herb says it’s like planning the ingredients for a home-cooked gourmet dinner. Depending on the dinner choice, the ingredients will change.
Collect your information
Most important, qualifying the authenticity of your information is paramount. Old information is history. Distorted information is worse than history. Information reliability means verifying its accuracy from more than one information source.
I can recall several instances where international sales reps told their sales managers about such-and-such sales opportunities in the countries they were representing. Only later did the host company learn that those countries had impossible entry barriers and that the sales reps didn’t mention or know about them.
Turn the true information into knowledge
This is a matter of taking the information you’ve collected and separating it into fact and fiction. It’s the art of understanding what the information means to you with respect to the specific decision you’re considering.
It’s also a matter of detecting patterns. For example, if you’ve narrowed your choices for an overseas market location to three countries, and you’ve lined up these companies on the same bench points, you might find significant information gaps in all but one of the countries you are considering.
That knowledge, based upon the available information and the facts that you have derived from it, will point you toward the most appropriate risk-choice to consider in your decision-making.
Add the final ingredient
When you’ve taken the first six steps, judgment will ultimately prevail. Herb says that judgment “is the sum total of who we are – the combined product of our character, our personality, our instincts and our knowledge.”
I recently wrote a Small Business Times article on wisdom. Wisdom is a precursor to good judgment and explains why two people can possess the same information and knowledge and yet arrive at a different decision. That’s why most good business judgment isn’t the province of one individual, but of the management team.
I cringe when I hear a CEO say, “I need no help from anyone. I’ve been around here long enough to have seen it all.” In this age of information and the speed by which it’s available, it makes sense to be wise and hold to the belief that using reliable information is a true competitive advantage.
Take the time to analyze the information that’s crucial to the future success of your business. It will be time well spent.