I can’t emphasize enough the problems that investors succumb to due to the human love of narrative (see this and this). We can find smart articles and insightful commentary online, but when taken in its totality it is little more than a cacophony of headlines, conspiracy theories, invalid logical arguments and other distractions. It is impossible to keep up, much less debunk, the never-ending series of myths produced by the noise machine.
The “human love of narrative” as well causes problems in business analytics.
An idea that’s gripped my imagination recently is that we’ve significantly underestimated the magnitude of this reality in our professional lives (I absolutely include myself in this plural pronoun).
Optimizing your intensity, in other words, might be more than a minor enhancement to personal productivity; it might instead unlock absurd rates of production.
Cheerleaders for big data have made four exciting claims, each one reflected in the success of Google Flu Trends: that data analysis produces uncannily accurate results; that every single data point can be captured, making old statistical sampling techniques obsolete; that it is passé to fret about what causes what, because statistical correlation tells us what we need to know; and that scientific or statistical models aren’t needed because, to quote “The End of Theory”, a provocative essay published in Wired in 2008, “with enough data, the numbers speak for themselves”.