Category Archives: Ethan Durda

House of Cards

House of Cards logo
I recently heard a great news story on National Public Radio on my way home from work that intrigued me and I thought I’d share with my one reader.  Specifically this article talked about metrics used by the hit Netflix show House of Cards.  Netflix is a great company to work for if you are a data nerd as they have extremely granular data not only of their customer demographics, but also, and more importantly, of their behavior and treatment of your product.

You’d think an organization with that much data, and a well-earned reputation for data savvy management, would pass those insights on to their production and development teams so they would know the best loved characters, how plot lines were received, and other critical information.  So how much does Beau Willimon, the show’s producer and creative driver, see?  Well, in his words: “I know virtually nothing.”

Wait, how does that happen?  This is Netflix, one of the major companies in the middle of the big data revolution and their hottest product right now is being run by a guy who doesn’t see any of that data?  This flies in the face of everything we know and love about data!  Aren’t we supposed to be running our business off of every data stream we can find?

I loved this story because it illuminates some very important facts about big data and how it should be actually used.  The first is that the data itself can be both a great tool…and a great detriment if you’re not careful.  As the interview continues, Mr. Willimon explains that he doesn’t want any of that data either.  He doesn’t want the distraction for his team of creative types and that kind of detail would have them second guessing each and every creative decision that they made.

Interestingly enough, we see that Netflix made this same decision.  They guaranteed Beau an extremely generous run of 26 episodes without seeing the first one.  By giving Mr. Willimon that promise, he was able to develop a rich canvas of characters and plots that don’t feel rushed or extreme.  The bread was given time to rise!  In contrast, new shows often have extremely short leashes with many being cut long before they complete their first season based on a few poor ratings.  The ability to focus on the product and not the numbers gave his team the creative freedom and also the peace to do the best job they could, without looking over their shoulders constantly.  They didn’t have to pander to their customers (us) with every episode but instead could, as master craftsmen, make the best product they could.

What Netflix understands is that the data itself is a representation at best of customer behavior, not of the quality of the product itself.  So as they created this series, they needed to focus on making a great product, independent of anything else.  Measuring the customer’s behavior and treatment of the product is important to know when choosing new products, marketing, and other activities; but you simply can’t try to create the product itself based on these data points.  Could you imagine Leonardo da Vinci stopping every paint stroke, to get the approval of and seek direction for his next stroke, by a gallery of people behind him?  What a mess the Mona Lisa would be!

We must never forget that people aren’t machines, constant, unending feedback loops dampen creativity and destroys vision and strategy.  While we should use these tools and technologies to shape behavior and help people maximize their limited resources, we shouldn’t get lost in the fact that they are indeed people who need room to be creative and experiment.  We often complain about reports and data being ignored by management when making decisions, that’s not always a bad thing.

The trick to a successful business is to find the right balance between usage of the data and quality decision making by a focused and knowledgeable management team.

402px-A_Roll_of_Toilet_Paper

I’ve have a few interesting experiences from this past big recession that are neither unique to me or really all that shocking so I thought I’d blog about it to no one.  Specifically when companies face financial hardship they make…interesting…decisions.

One recent experience was that company missing its revenue targets responded by getting rid of the ice machine in the break room and cutting back on janitorial services.  Mind you the garbage piled up in the break room was annoying, but the real issue was the bathrooms which ran out of paper products and became rather horrid after 200+ people used them all day.

Another company responded by removing alternating light bulbs in the hallway florescent lighting and turning the air conditioning down.  Keep in mind, in Arizona it can get a bit warm during the summer, so that matters.  I suppose they thought by removing the light bulbs they would reduce the heat they produced and thus would need less AC.  I’m not sure about the heat balance formula, but it didn’t work.

The money that was saved by these executives was completely inconsequential when compared to the loss of productivity of people who now pretty much gave up on the company and spent their entire days looking for new jobs and complaining to each other.

I wonder what the executives who made this decision thought about the consequences of their actions.  Did they really think that no one would notice or care?  It reminds me of the recent comment the Sergeant Major of the Marine Corps (top non-commissioned officer) Micheal Barrett made to Congress that Marines cared more about better equipment than pay and that lowering pay raises would “improve discipline”.

I’m not entirely sure what Sgt. Maj. Barrett what was trying to say, and I don’t feel the need to even write about his half-hearted “clarification”, but it certainly makes him look like he couldn’t care less about the people below him.  Certainly every Marine out there had that opinion.  Likewise when executives at the aforementioned companies made their decisions they are basically saying we don’t care about how this affects anyone because everyone will just follow my orders and that’s all there is to it.

The problem of course is that people are…people.  We have emotions, feelings, fears, hopes and dreams.  The biggest mistake leaders can make is to ignore this and pretend that they can simple cause things to happen by edict and that every decision is compartmentalized and that taking out the ice machine will save $1,000 for the company and that will go straight to the bottom line.

So why this on a BI blog…well, because BI is about more than the bottom line.  One of the first things BI professionals should understand is that numbers mean things and that while they reflect human behavior they do not directly cause it.  They certainly influence the decisions people make, but people are complex creatures and you can’t pretend that they won’t react the decisions you make in unexpected ways.

The solution of course is to treat your employees as a part of the solution and not just a cost.  If instead of cutting off the lights in the hallway the company instead put out a series of KPI’s and asked employees to help design solutions for moving the needle on them?  Rather than cut the toilet paper supply off, put together a gamification model for increasing cash flow?  If the best idea to save money the CEO came up with is to cut the AC then perhaps we’ve identified the actual problem!

So help me out, I’m on the only one seeing these things?

Be Unafraid

Lion waiting in Namibia

You don’t have to feel safe to be unafraid. For those unfamiliar, that is a line out of the chorus of the song Lions! by Lights. The refrain might have been written for me and I’ve been reflecting on it lately as I make the transition from an employee of a consulting company to an independent consultant.

So now I get to look for work, do the work all the while balancing my family; that should be easy…right? In any case, I will do my best to keep blogging on BI topics and look forward to hearing from any and all with advice (other than I’m crazy which I already know) and suggestions (other than get a job, which I’m trying to do).

I’m looking forward to this new chapter in my life and the birth of Ascension Business Intelligence LLC with all of its risks, fears and opportunities that will come along with it. So wish me luck and give me a hand while I move forward without fear, even if I don’t feel safe.