Are your metrics misleading?

time for factsA recent article in the paper was based on research published by a university. It was an interesting article that had a significant number of statistics. The results were counterintuitive to both the researcher and the writer of the article, both having indicated they expected the opposite of what actually happened. The results were listed in a table off to the side, showing the absolute occurrences in two different groups, along with the population size. The numbers became very small very quickly in the percentage of occurrences. The percentages in most cases between the groups were very close because there were few occurrences. But the article focused on the percentage change between the two groups, which became a big percentage and misleading as to how often the occurrence happened between the groups.

For example, in group one there is an occurrence 1 time in 10,000. In group 2, there is an occurrence 2 times in 10,000. In group one, the occurrence happens 0.01% of the time, and 0.02% of the time in group 2. In either case, it is negligible. But framed another way, it could be stated that occurrences happen twice as frequently in group 2. That seems like a lot more!

How information is presented can have a significant impact on perceptions and form the basis of how decisions are made. How are you making sure the data presented in your organization is fairly representing what is actually going on so appropriate decisions can be made?

Posted in Financial Management, Leadership, Strategy.

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