Monthly Archives: December 2012

Will Big Data Replace Strategy?

First published December 27, 2012 in Mediapost’s Search Insider

Anyone who knows me knows I love strategy. I have railed incessantly about our overreliance on tactical execution and our overlooking of the strategy that should guide said execution. So imagine my discomfort this past week when, in the midst of my following up on the McLuhan theme of my last column, I ran into a tidbit from Ray Rivera, via Forbes, that speculated that strategic management might becoming obsolescent.

Here’s an excerpt: As amounts of data approaching entire populations become available, models become less predictive and more descriptive. As inference becomes obsolete, management methods that rely on it will likely be affected. A likely casualty is strategic management, which attempts to map out the best course of action while factoring in constraints. Classic business strategy (e.g., the five forces) is especially vulnerable to losing the relevance it accumulated over several decades.

The crux of this is the obsolescence of inference. Humans have historically needed to infer to compensate for imperfect information. We couldn’t know everything with certainty, so we had to draw conclusions from the information we did have. The bigger the gap, the greater the need for inference. And, like most things that define us, the ability to infer was sprinkled through our population in a bell-curved standard distribution. We all have the ability to fill in the gaps through inference, but some of us are much better at it than others.

The author of this post speculates that as we get better and more complete information, it will become less important to fill in the gaps to set a path for the future — and more important to act quickly on what we know, correcting our course in real time: With access to comprehensive data sets and an ability to leave no stone unturned, execution becomes the most troublesome business uncertainty. Successful adaptation to changing conditions will drive competitive advantage more than superior planning.

Now, just in case you’re wondering, I don’t agree with the premise, but there is considerable merit to Rivera’s hypothesis, so let’s consider it using a fairly accessible analogy: the driving of a car. If we’re driving to a destination where we’ve never been before, and we don’t know what we’ll encounter en route, we need a strategy. We need to know the general direction, we need a high-level understanding of the available routes, we need to know what an acceptable period of time would be to reach our destination, and we need some basic strategic guidelines to deal with the unexpected – for example, if a primary route is clogged with traffic, we will find an alternative route using secondary roads. These are all tools we use to help us infer what the best way to get from point A to B might be.

But what if we have a GPS that has access to real-time traffic information and can automatically plot the best available route? Given the analogous scenario, this is as close to perfect information at we’re likely to get. We no longer need a strategy. All we need to do is follow the provided directions and drive. No inference is required. The gaps are filled by the data we have available to us.

So far, so good. But here is the primary reason why I believe strategic thinking is in no danger of expiring anytime soon. If strategy was only about inference, I might agree with Rivera’s take (by he way, he’s from SAP, so he may have a vested interest in promoting the wonders of Big Data).

However, I believe that interpretation and synthesis are much more important outcome of strategy.  The drawback of data is that it needs to be put into a context to make it useful.  Unlike traffic jams and roadways, which tend to be pretty concrete concepts (stop and go, left or right — and yes, I used the pun intentionally), business is a much more abstract beast. One can measure performance indicators ad nauseam, but there should be some framework to give them meaning. We can’t just count trees (or, in the era of Big Data, the number of leaves per limb per tree). We need to recognize a forest when we see one.

Interpretation is one advantage, but synthesis is the true gold that strategic thinking yields. Data tends to live in silos. Metrics tend to be analyzed in homogenous segments (for example, Web stats, productivity yields, efficiency KPIs). True strategy can bring disparate threads together and create opportunities where none existed before. Here, strategy is not about filling the gaps in the information you have, it’s about using that information in new ways to create something remarkable.

I disagree most vehemently with Rivera when he says: While not disappearing altogether, strategy is likely to combine with execution to become a single business function.

I’ve been working in this business for going on three decades now. In all that time, I have rarely seen strategy and execution combine successfully in a single function (or, for that matter, a single person). They are two totally different ways of thinking, relying on two different skill sets. They are both required, but I don’t believe they can be combined.

Strategy is that intimately and essentially human place where business is not simply science, but becomes art. It is driven by intuition and vision. And I, for one, am not looking forward to the day where it becomes obsolescent.

McLuhan 50 Years Later

First published December 20, 2012 in Mediapost’s Search Insider

My daughter, who is in her senior year of high school, recently wrote an essay on Marshall McLuhan. She asked me to give my thoughts on McLuhan’s theories of media. To be honest, I hadn’t given McLuhan much thought since my college days, when I had packed away “Understanding Media: The Extensions of Man” for what I thought would likely be forever. I always found the title ironic. This book does many things, but promoting “understanding” is not one of them. It’s one of the more incomprehensible texts I’ve ever encountered.

My daughter’s essay caused me to dig up my half-formed understanding of what McLuhan was trying to say. I also tried to update that understanding from the early ‘60s, when it was written, to a half-century later, in the world we currently live in.

Consider this passage from McLuhan, written exactly 50 years ago: The next medium, whatever it is—it may be the extension of consciousness—will include television as its content, not as its environment, and will transform television into an art form. A computer as a research and communication instrument could enhance retrieval, obsolesce mass library organization, retrieve the individual’s encyclopedic function and flip into a private line to speedily tailored data of a saleable kind.

(See, I told you it was incomprehensible!)

The key thing to understand here is that McLuhan foretold something that I believe is unfolding before our eyes: The media we interact with are changing our patterns of cognition – not the message, but the medium itself. We are changing how we think. And that, in turn, is changing our society. While we focus on the messages we receive, we fail to notice that the ways we receive those messages are changing everything we know, forever. Twitter, Facebook, Google, the xBox and Youtube – all are co-conspirators in a wholesale rewiring of our world.

Now, to borrow from McLuhan’s own terminology, no one in our Global Village could ignore the horrific unfolding of events in Connecticut last week. But the channels we received the content through also affected our intellectual and visceral connection with that content. Watching parents search desperately for their children on television was a very different experience from catching the latest CNN update delivered via my iPhone.

When we watched through “hot” media, we connected at an immediate and emotional level. When the message was delivered through “cool” media, we stood somewhat apart, framing the messaging and interpreting it, abstracted at some length from the sights and sounds of what was unfolding. Because of the emotional connection afforded by the “hot” media, the terror of Newtown was also our own.

McLuhan foretold this as well: Unless aware of this dynamic, we shall at once move into a phase of panic terrors, exactly befitting a small world of tribal drums, total interdependence, and superimposed co-existence. […] Terror is the normal state of any oral society, for in it everything affects everything all the time.

My daughter is graduating next June. The world she will inherit will bear little resemblance to the one I stepped into, fresh from my own graduation in 1979. It is smaller, faster, more connected and, in many ways, more terrifying. But, has the world changed as much as it seems, or is it just the way we perceive that world? And, in that perception, are we the ones unleashing the change?

The “Savanna” Hypothesis of Online Design

First published December 6, 2012 in Mediapost’s Search Insider

I’m currently reading a fascinating paper titled “Evolved Responses to Landscapes” by Gordon Orians and Judith Heerwagen that was written back in 1992. The objective was to see if humans have an evolved preference for an ideal habitat. The researchers called their hunch the Savanna Hypothesis, noting that because homo sapiens spent much of our evolutionary history on the plains of tropical Africa, we should have a natural affinity for this type of landscape.

Your typical savanna features some cover from vegetation and trees, but not too much, which would allow natural predators to advance unnoticed. The environment should offer enough lushness to indicate the presence of ample food and water. It should allow for easy mobility. And it should be visually intriguing, encouraging us to venture and explore our habitat.

Here’s a quote from the paper: “Landscapes that aid and encourage exploration, wayfinding and information processing should be more favored than landscapes that impede these needs.”

The researchers, after showing participants hundreds of pictures of different landscapes, found significant support for their hypothesis. Most of us have a preference for landscapes that resemble our evolutionary origin. And the younger we are, the more predictable the preference. With age, we tend to adapt to where we live and develop a preference for it.

In reading this study, I couldn’t help but equate it to Pirolli and Card’s Information Foraging Theory. The two PARC researchers said that the strategies we use to hunt for information in a hyperlinked digital format (such as a webpage) seem to correspond to evolved optimal foraging strategies used by many species, including humans back in our hunting and foraging days. If, as Pirolli and Card theorized, we borrow inherent strategies for foraging and adapt them for new purposes, like looking for information, why wouldn’t we also apply evolved environmental preferences to new experiences, like the design of a Web page?

Consider the description of an ideal habitat quoted above. We want to be able to quickly determine our navigation options, with just a teaser of things still to explore. We want open space, so we can quickly survey our options, but we also want the promise of abundant rewards, either in the form of food and sustenance — or, in the online case, information and utility. After all, what is a website but another environment to navigate?

I find the idea of creating a home page design that incorporates a liberal dose of intrigue and promise particularly compelling. In a physical space, such an invitation may take the form of a road or pathway curving behind some trees or over a gentle rise. Who can resist such an invitation to explore just a little further?

Why should we take the same approach with a home page or landing page? Orians and Heerwagen explain that we tend to “way-find” through new environments in three distinct stages: First, we quickly scan the environment to decide if it’s even worth exploring. Do we stay here or move on to another, more hospitable location? This very quick scan really frames all the interactions to take place after it. After this “go-no/go” scan, we then start surveying the environment to gather information and find the most promising path to take. The final phase — true engagement with our surroundings — is when we decide to stay put and get some things done.

Coincidentally (or not?), I have found users take a very similar approach to evaluating a webpage. We’ve even entrenched this behavior into a usability best practice we call the “3 Scan Rule.” The first scan is to determine the promise of the page. Is it visually appealing? Is it relevant? Is it user-friendly? All these questions should be able to be answered in one second or less. In fact, a study at Carleton University found that we can reliably judge the aesthetic appeal of a website in as short a span as 50 milliseconds. That’s less time than it takes to blink your eye.

The second scan is to determine the best path. This typically involves exploring the primary navigation options, scanning graphics and headings and quickly looking at bullet lists to determine how “rich” the page is. Is it relevant to our intent? Does it look like there’s sufficient content for us to invest our time? Are there compelling navigation options that offer us more? This scan should take no more than 10 seconds.

Finally, there’s the in-depth scan. It’s here where we more deeply engage with the content. This can take anywhere from several seconds to several minutes.

At this point, the connection between the inherently pleasing characteristics of the African savanna and a well-designed website is no more than a hypothesis on my part. But I have to admit: I find the concept intriguing, like a half-obscured pathway disappearing over a swell on the horizon, waiting to be explored.