Do You Follow Your Gut or Data?
January 18, 2012
In working on the 2012 forecast piece for the January/February issue, I had the opportunity to talk to a lot of folks in the window and door industry about what they expect for the coming year. We covered a lot of topics, as I’m sure you can imagine, ranging from the significant challenges our industry continues to face, to the overlooked opportunities that some companies are pursuing in a down market.
One comment in particular, however, stands out among the rest. One of my interviewees pointed out to me that his company is highly data driven in its decision making. In other words, his company doesn’t go with gut instinct when it comes time to offer new products or improve support materials to its distributor network. Instead, executives rely strictly on data and facts to make decisions. This, he notes, allowed his company to avoid “drinking the industry Kool-Aid” when making projections for 2011 (they didn’t anticipate growth, where many companies did) and paved the way for some successful product introductions based on buying patterns and regional preferences.
Still, this just-the-facts-ma’am approach to business isn’t the only way to succeed. Plenty of companies have built their models around industry experience and a “gut feel” for what will succeed in the marketplace. My question for you this week is where your company falls on the spectrum—is your team one of data-based decision makers or do you rely more on the collective experience of the group and follow your intuition?
Please send me an email or post a comment to share with me how your company approaches strategic decision making. Facts, gut, or a blend of both? What approach do you think is most successful in our business?
Survey Results as of 01/23/2012 :
When it comes to strategic decision making, my company relies more heavily on:
Collective experience and gut instincts
Statistics and facts
The responses to this week's poll definitely reflects the entrepreneurial nature of the window and door industry. With nearly 70 percent of respondents relying on their gut instinct to make business decisions, we could probably venture to guess that experience in the industry and a deep understanding for customers' needs is where many window and door companies can peg their success.
Still, I do wonder if the folks who follow the facts are increasing in number compared to a few years back. Would the fact follwers have been 5 percent or 10 percent of the population during the construction boom? Do you think that if we ask the same question a year or two from now we might find that the data-driven decision makers are increasing in number? In a market where there's relatively little room for error, perhaps that will be the case.