Numbers I have loved

People whisper to horses, dogs, and (according to TV) ghosts. Why not models? The model whisperer — perhaps you, savvy strategist — gently, wisely guides models into shape and helps them achieve fulfillment as oracles of your business’ future. (#3 in a series)

The challenge in developing an effective strategy begins long before we decide what actions to take and how to execute them. The challenge begins when we decide what model to use. By selecting a model we frame the way we see and evaluate our strategy options. (#2 in a series)

We can classify models chemically: those based on carbon and those based on silicon. The former, mental models, operate inside our heads. The latter, computer-based models, operate inside computers. They behave differently. (#1 in a series)

The presence of numbers does not guarantee insight, knowledge, or inspiration. On the other hand, the absence of numbers limits us to anecdotes, impressions, and hypotheses. So, we want numbers, and we want them not to drive us crazy.

Upcoming programs from ACS: Webinars about business war games and strategic thinking, and a workshop at the 2010 SCIP Conference entitled Numbers Gone Wild: Or, Precision In, Garbage Out.

Firefighters in New Haven, CT, allege reverse discrimination in a case now before the U.S. Supreme Court. The data seem to support…not so fast, it’s not so clear. What can we learn about the case, what can we learn about using data?

Have you ever seen 36,270 what-if’s on your strategy ideas? Have you ever seen your 36,270 what-if’s compared in a universe of 5,658,120 simulations? That’s what ACS did for over 150 strategists competing in a pricing tournament.

We know pretty well how to assess the financial impact of a product or service that purports to reduce costs. What about products or services that purport to improve the quality of our decisions? And how can we avoid the traps of streaks and slumps?

We think extrapolation is self-evidently defensible, and it is merely on-the-surface defensible. It falls apart when things get interesting, which is precisely when we need help the most… and precisely when we are most vulnerable to bad advice.

Ceteris paribus isn’t easy. It’s the gold standard we use in double-blind clinical trials of drugs and medical treatments, but the business equivalent of clinical trials is difficult at best.