The Advantages of Being Data-Informed Over Data-Driven

Across all sectors, data has undoubtedly become king. As organizations navigate an increasingly digital landscape, the demand for data has grown exponentially. We often hear buzzwords like “data-driven decision-making,” while the concept seems logical and effective, it can be too restrictive in certain situations. The new wave of thought is to be ‘data-informed’ rather than ‘data-driven.’ In this blog post, we’ll explore the difference between these two concepts and highlight why being data-informed can often be more beneficial for organizations.

What does being ‘Data-Driven’ mean?

Being data-driven is about making decisions based purely on quantitative data, with the underlying belief that data never lies and that it can always lead to the best decision. Data-driven organizations prioritize hard numbers and facts above all else and typically rely heavily on big data, data analytics, and predictive models to guide their actions. Although valuable in many respects, this approach often leaves no room for other influential factors such as intuition, creativity, and human judgment and tends to treat all data as inherently reliable and objective.

What does being ‘Data-Informed’ mean?

On the other hand, being data-informed is about using data as a tool rather than an oracle. In this model, data is an essential part of the decision-making process, but it doesn’t dictate actions unequivocally. Instead, data informs decisions and other factors such as intuition, qualitative feedback, human emotions, values, market trends, and expertise. In a data-informed culture, organizations understand that while data can provide valuable insights, it should not completely override human judgment or contextual understanding.

Now, let’s explore why being data-informed can often be more beneficial for organizations.

1. Context Matters

The real world is a complex and messy place, and data can sometimes miss the bigger picture. Data can tell you what is happening, but not always why it’s happening. To truly understand the ‘why,’ we need context, which often comes from human experience, intuition, and qualitative insights.

2. Not all Data is Reliable

Data can sometimes be misleading, particularly when incomplete, skewed, or incorrectly analyzed. Being data-informed rather than data-driven allows room for skepticism and scrutiny, making it less likely for decision-makers to be misled by unreliable or biased data.

3. Balancing Innovation and Risk

A purely data-driven approach favors tested and proven strategies, which might stifle innovation. However, data-informed allows room for experimentation, encouraging a balance between calculated risk-taking and data-backed decision-making.

4. Incorporating Human Elements

In many situations, particularly those involving customers or employees, human emotions and experiences play a vital role. A purely data-driven approach might overlook these qualitative aspects. Data-informed decision-making allows for the inclusion of qualitative insights, leading to more empathetic and human-centered decisions.

5. Agility and Flexibility

A data-informed approach allows organizations to be more agile and flexible. Since decisions aren’t solely based on data, pivoting or adapting when circumstances change is easier. This flexibility is critical in dynamic environments, where change is the only constant.

To sum it up, while being data-driven has its merits, it’s crucial to balance relying solely on data and incorporating other vital factors into the decision-making process. Data is undoubtedly a powerful tool, but it should be used to inform decisions, not dictate them. By adopting a data-informed approach, organizations can make better, more balanced decisions considering a wide range of factors beyond just numbers.