Leadership for Life – Lies, Damned Lies, and Statistics

By on June 30, 2014
Leadership for Life - Lies, Damned Lies, and Statistics

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The phrase, “Lies, damned lies, and statistics” has been variously attributed to Mark Twain, Benjamin Disraeli, and a few others. Wherever it comes from, its use usually is part of a speaker’s (or writer’s) denunciation of the use of statistics to prove a point with which the speaker (writer) disagrees.

The use of statistics to “prove” a point or make decisions has its pros and cons. When you’re dealing with a great many people or events, statistics can be useful in showing or predicting trends, and can be useful in making decisions based on those trends. The problem is that those people or events that fall outside the sample used for the statistic aren’t accounted for. The other problem with statistics is that they don’t take into account the realities of individuals, even those within the sample. For this reason, using statistics to make business decisions, especially those regarding the workforce, is often denounced as “inhumane” to those affected. The bottom line is that if it happens to you, it’s 100 percent.

Another problem with statistics, especially in the economic sphere, is that they are based on certain assumptions. If the assumptions are incorrect or even marginally inaccurate, the end result can be off by several orders of magnitude.

These days, many leaders are making decisions based on statistical models of one sort or another. For instance, statistics indicate that many baby-boomers will be retiring in the next five years or so. Therefore decisions on succession planning and other leadership pipeline issues are being made with the assumption that the statistics accurately predict the behavior of managers and executives approaching age 65. That assumption proved inaccurate during the most recent recession, as many boomers, who were planning to retire soon, saw their retirement nest eggs fall in value, and therefore had to continue working past their projected retirement age. Gen X-ers who were planning to move up in their organizations had to rethink their futures.

As a leader, you have to make decisions based on the best data available to you, some of which will be in statistical form. It’s your task to sift through the data, examine the assumptions that underlie the data, and take into account the human costs involved. The lines, graphs, and pie charts may look impressive, but remember that your own powers of observation and your professional judgment have to work in concert with the statistics in order to make the best decision.

About Barry Schapiro

Barry is the Workforce Solutions Group Practice Leader for Leadership and Professional Development. His experience includes delivery and management of business training in a variety of industries, with specialties in leadership, team development, generational diversity, and customer service. Twitter

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