No industry in the world has produced as many celebrated CEOs and Entrepreneurs as the tech industry has in the last two decades.
The leaders of billion-dollar tech companies are celebrities far beyond the business world. Richard Branson’s empire grew from pure hustle, and the man had practically no knowledge of the products he was selling.
Steve Jobs was obsessed with function and design and lost the support of many friends and family members for his undying need to attain perfection in his products. Mark Cuban, Mark Zuckerberg, Jeff Bezos, Elon Musk and much more had both vision and determination.
The list of tech geniuses could go on for pages.
But the profile of CEO that achieved such enormous levels of success in the past two decades may not be the same profile that makes businesses succeed going forward.
To be sure, the head of a company needs to be a visionary, an excellent manager, competent at allocating resources, and so much more. But many decisions being made today require very little vision or experience. In fact, data has so radically transformed business decision-making that in some corners of business, troubleshooting is a dying art altogether.
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The New CEO
There is a scene in "The Social Network" where Sean Parker (played by Justin Timberlake) turns to Mark Zuckerberg and says, “Drop the ‘the’, just ‘Facebook’, it’s clean.” This tidbit of insight wins over Zuckerberg and convinces him to hire Parker. Naturally, this is a movie, but there is some truth here that once was a guiding factor in decision making. Needless to say, making a hiring decision can immensely depend on someone’s personality and eye for detail.
Today, however, such an interaction would seem about as theatrical as it came across in the film. A room full of business executives would doubtlessly insist on getting data-backed proof to understand which name would work better; Facebook or The Facebook. It’s more likely that today an executive would simply reply, “Sure, let’s A/B test that.”
In other words, instead of going out on a limb and trusting one person’s intuition, the instinct is now to turn to the data. Whoever wins at generating the most relevant data and reading what it means, wins. Companies are now getting very good at generating data.
Tomer Levy, CEO of Tel Aviv-based log analytics company Logz, says it is possible to make enormous business decisions with confidence by harnessing and interpreting data correctly.
“The ability to capture data today is unprecedented. With the right tools, you can track every keystroke and click that takes place within any IT environment,” says Levy.
Why is data more valuable than expert opinion? There are a few reasons.
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The Power of Data
First, an expert might rely on human communication to identify a problem. If an app has launched and is struggling, an obvious solution would be to poll users and ask them about their experience. User opinion and feedback is an integral part of improving the over function and experience of a product.
The problem is that people frequently do not communicate their actual experience or behavior, mainly because many people are actually completely unaware of what it is they do. That is why in a study of the UK’s roadside rest stop bathrooms, 99 percent of people claimed to have washed their hands even though only 32 percent of men and 64 percent of women actually did. Data allows you to focus on actual activity, not the alternate reality that comes from human communication.
“If you were to ask a user why he or she stopped using your app, they might say it was because they found another app that worked better. But if you look at the data, you might find that they struggled to understand a particular feature,” says Levy. “That would help you to make the right adjustment the first time.”
The second reason data is replacing the need for expertise is because it avoids the pitfalls of human investigation. Pick your favorite pitfall of human psychology: confirmation bias, illusory correlation, belief perseverance, attitude polarization; data is not subject to any of them.
If a presidential campaign manager looked at Twitter every day for five minutes and tried to assess public opinion on any particular issue, they would walk away with an opinion based on subjective analysis of a tiny sampling of information. That is why campaigns and news organizations voraciously seek out data to circumvent the pitfalls of human expertise.
Logz.io recently launched a platform for journalists to use that allows them to track public opinion with precise accuracy based on the emergence of keywords on Twitter. By intelligently tracking words and combinations of words it is possible to project opinion, analyze behavior, and even predict election results.
The truth is that computers are not going to replace the leaders of enterprises anytime soon, but CEOs who ignore the power of data, and the sheer importance of data may find themselves out of work, or at least struggling to keep up.
In order to stay on top of the market, business leaders need to be actively seeking out new sources of data and new ways to analyze various forms of data, like survey results and social analytics. It is through the process of more advanced forms of data analysis that we will find a whole new range of tech geniuses and leaders.