Data Obesity: Overconsumption Is Not Good For Business

Data obesity: when business leaders consume too much news, especially news that is not vital to their company. News headlines bombard us: factory activity, tariffs, car sales, oil prices and many, many other concepts. Those who bear great responsibility feel the need to know what is happening, but too much information can distract from important business issues, as well a distort executives’ views of their companies’ actual prospects. Many of us suffer from data obesity.

Penn Jillette recently commented (on the Joe Rogan podcast) that for most of history, all animals faced a shortage of calories. That was their primary challenge: get more calories. Now, in the last 100 years or so, in some countries, calories are abundant. We are not prepared for the challenge of too many calories, so our new problem is obesity. Jillette says that it’s the same with information. One issue of the New York Times has more news than a typical peasant got all of his life. We are data obese.

Not everything impacts any particular business, so company leaders need to filter their news inputs. International trade wars may make headlines, but the owners of my local coffee shop should avoid that news. They should, instead, pay attention to local employment and wage rates. Other companies, though, can ignore local employment but must focus on sales to overseas buyers. I have argued that every business needs an economic dashboard. Also, every leader must have an “un-dashboard:” the list of irrelevant economic statistics. These items must be avoided.

The interconnectedness of the economy leads to the idea that everything is important, but no one can run a business while digesting all economic statistics. Instead, the effective executive prioritizes incoming data based on how much they drive profits.

In addition to sheer information overload, headlines generate biased views of what is happening. Within news organizations, there’s a pronounced tendency to emphasize problems. In local television news, “if it bleeds, it leads.” Similarly in the business press, a collapse of negotiations gets more attention than productive talks. A bankruptcy is announced in bold headlines, but steady corporate growth may get a short back-page paragraph. The consumer of news sees a distorted picture of the world.

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