Lies, damn lies and analytics
Analytics is the new god of the information age
There could be nothing cleaner, purer and more truthful than analytics, as it descends from that holy science of mathematics. Unlike language and humanities that have always flirted audaciously with shades of grey, and have never admitted the presence of an absolute truth, mathematics has stood for a single solution to any problem. Of course, we are not factoring in new age sciences like quantum mathematics, that are veering dangerously close to admitting the central role of uncertainity.
But what’s the difference between analytics and statistics? Why does an old science need a new name?
There are some arcane discussions on CIO forums about the difference, but the only material difference seems to be that analytics has been more smartly marketed and is now churning out billions of dollars of revenue.
The biggest companies in the information age have been built on the back of analytics.
But that shouldn’t take our eyes away from the fact that analytics is just a repositioning of statistics and is hence prey to all the fallacies and fallibilities of the older avatar.
And the most damning insinuation about statistics has been its amenability to misuse.
Analytics, as practised in the information age has taken data-based obfuscation to new levels. Since master statisticians are behind the analytics giants, it becomes quite difficult for lesser individuals to question analytics.
It’s like questioning truth.
Its like if you question the truth you must be a liar.
If you question analytics, you must be quantitatively challenged. Or a liar.
Because analytics is truth.
Or, that’s what the new evangelists of the science would lead us to believe.
Who are they?
Search engines. Social networks. Media houses. Market research agencies. CRM agencies.
Of course, all of them own data. They make money by selling that data.
And the price of the data they own is determined by the analytics feedback the clients get.
You know the value of every dollar spent.
How? Because they tell you so!
A social network would tell you that users are very very engaged if you spend money through them
A search engine would tell you that every dollar spent nudges you up on the search rankings. Of course they would also tell you it’s a lot more costly and inefficient to acquire customers on a social network.
Market research agencies would always tell you that you can never take customers for granted. They can quite quickly change. If your eyes are not on the ball, regularly, then scores can slide.
CRM agencies would crunch all your numbers to tell you how every dollar spent hounding existing customers is far more profitable and how businesses are driven almost solely by loyal customers.
And so on.
The problem is that analytics is being churned out by companies that have a vested interest in the results that are thrown up.
It might never be possible to break this link – it is as insidious as the links between audit firms and consulting firms and capital investment firms.
But it helps to be aware, at least.