Top level managers use intuition, but they ask lower level managers for their opinions and they expect those opinions to be informed by big data, researchers say.
More than two-thirds of managers prefer to trust their gut over big data, new research has found.
Dr Nazim Taskin and Professor David Pauleen from Massey’s School of Management along with colleagues from Auckland and Queensland Universities, surveyed 116 managers from predominantly large and medium-sized New Zealand businesses.
The goal of the work was to better understand the impact of data-analytics on corporate decision-making.
Taskin said experience with big data made all the difference in a willingness to trust the information.
* How businesses, media, Government work on gaining public trust
* Voice driven customer service future of marketing
* Small business owners should tap into data analysis, US expert Donald Farmer says
* People analytics could be way of future for HR
“Nearly two-thirds of the managers interviewed said they had no confidence or trust in big data, preferring to rely instead on their intuition and experience to make decisions,” Taskin said.
“One-quarter of participants also confessed they had only a modest knowledge of what big data is, or what it can do.”
Without a deep understanding of how big data worked, the managers were more likely to trust their instinct and the opinions of others, Taskin said.
“Top level managers use intuition but they ask lower level managers for their opinions and they expect those opinions to be informed by big data,” he said.
Taskin said age and education impacted a manager’s familiarity with analytics.
“We asked these managers why they relied on intuition more and found if they didn’t have previous experience with big data, they didn’t tend to use it,” he said.
“Analytics in business education became more common after 2000. For many older managers, big data was not part of their backgrounds or education.”
The next step of the research was to examine the impact of intuition over data related decision making and to look more in-depth at what was stopping managers from using analytics.
“Simply collecting data without the skills to analyse it is costly, and analysis without direction can be deadly,” Taskin said.
“On a positive note, it’s clear that once a manager experiences good outcomes with big data, it builds confidence in applying analytics tools more regularly.”
Of the companies involved in the research, 28 per cent had between 20 and 100 employees while 70 per cent had more than 100 employees.
The remaining two per cent employed less than 20 people.