MIT Sloan Management Review

ESSAY
Is Decision-Based Evidence Making Necessarily Bad?

Many managers think they’ve committed their organizations to evidence-based decision making — but have instead, without realizing it, committed to decision-based evidence making. Is that all bad? What can be done to fix it? BY PETER M. TINGLING AND MICHAEL J. BRYDON

DECISION MAKING IS the essence of management, which explains why so much attention continues to be focused on how to do it better. In recent years, much has been written about evidence-based — or fact-based — decision making. The core idea is that decisions supported by hard facts and sound analysis are likely to be better than decisions made on the basis of instinct, folklore or informal anecdotal evidence. One need look no further than the shelves of the local bookstore to see an unprecedented collection of well-written titles extolling the virtues of data and analysis, such as Competing on Analytics (Davenport and Harris), Moneyball (Lewis) and Super Crunchers (Ayres). These books, like decision-making courses in business schools and the prescriptions of management consultants, focus on how to improve decision outcomes through improved process and technique. Many organizations have heeded the call and have invested heavily in data processing infrastructure and analytic tools, based on the assumption that better evidence-based decisions will follow naturally from these investments. While this focus on evidence is a welcome change from “thin slicing” or purely instinctive or intuitive snap judgments, these prescriptions tend to downplay the more fundamental questions: What is the relationship between evidence and the decision process that an organization actually uses? Why is evidence collected in the first place?

Our research and consulting experience suggests that evidence is not as frequent an

THE LEADING QUESTION

Managers want ‘ fact-based’ decisions.

Are they getting them?

FINDINGS

Evidence is not as frequent an input to decisions as suggested by the business press.

Not all decisions

use evidence in the same way.

Evidence can be used to make, inform or support a decision.

Managers need

to be aware that evidence is shaped by subordinates to meet perceived expectations of company leaders.

Some decisions can’t be made based on evidence at all. The facts are too ambiguous — such as the rejection by focus groups of the aesthetics of Herman Miller’s Aeron chair.