Startup Data Reliability Grid Successful Evaluation of Market Data for Strategic Decisions
Startup Data Reliability Grid: Good strategic decisions take account of market intelligence and the conclusions we draw from the data. This is especially true in new venture creation, where experience is limited. What we need to take into account is the reliability of the data we collect. It is some times tough to do, because we may have conflicting evidence. So, we need some methodical way of evaluating that market intelligence.
When I was in training in British military counter intelligence towards the end of the Cold War, we were drilled in comparing and contrasting. We had to evaluate the reliability of information sources—the context, as well as correlating that information with other items of information collected. We had to examine assumptions, and be critical about our beliefs. What I learned back then can be applied to strategic decisions and market intelligence in new venture creation today.
Below is the Startup Data Reliability Grid, a simplified version of the kind of grid that we used in the military. When you set out the information graphically in this way, it is easier to see the ‘wood for the trees’. By comparing the individual items of data and plotting them against their sources, you gain confidence about the reality of the marketing intelligence that you have collected and can make better strategic decisions.
Startup Data Reliability Grid
So, for example, if you have market data (quantitative and qualitative) about your intended customers, put the numbers or opinions in the first column, where the particular data came from in the second—and now the tricky part: put your evaluation of the reliability of the source in the last column. Now you’ll be able to see in graphic and comparative terms each bit of data, to help your level of confidence in decision making.
It is vital to be concerned with probability of your data being right, since you can never be certain about the likelihood of your strategy working out precisely. By evaluating the degree of trust that you have in both the information’s subject and its source, you can significantly reduce your level of uncertainty, or improve your confidence in the likely outcome of decisions based on the data.
You may get more help from the US Army guidance on intelligence evaluation:
New venture creation is hazardous at the best of times. Impulsive decision making is often the norm. Stopping to draw breath before ‘pulling the trigger’ may help you to avoid costly mistakes. I know from my own new venture creation experience that I made early assumptions that were based on my gut feel, rather than good data examined in a reflective way. This approach to market intelligence seem a bit cumbersome, but it will probably save you time and money correcting mistakes.