Why not test?

People love appearing to have knowledge. Often they are less careful about working out whether what they are saying makes sense. A concern I have is that we often claim to know much more than we actually know. We have some hunches or ideas and these gain the status of facts in our minds. Clearly this influences politics where incredible claims are made without any backing evidence.

The problem of lack of evidence goes beyond politics however. Academics often feel the need to claim knowledge about situations when they can’t possibly know what is going on. Similarly, business people often feel the need to claim they have all the answers. Confidence replaces thought.

A better approach I would say is to cultivate the ability to test. We can produce evidence for our ideas, rejecting the ones that don’t make sense given the test results. With Katie Chen and Dilip Soman I have produced a piece for the Ivey Business Journal that outlines the importance of testing our ideas. We outline how experimentation can help business people understand the world they face. It is great when a true experiment is possible — when people can be randomly assigned to the various conditions. This can happen relatively easily in online marketing — where different pages can be served up to visitors at random — and in direct mail — where personalized offers can be randomly assigned to customers.

Even when random assignment isn’t possible you don’t need to abandon the goal of testing. We note that a range of businesses can use field tests that, while not perfect by ideal experimental standards, do a good job of generating evidence to help us understand the world. We suggest that many organizations can use tests to be understand the world and so become more successful.

Our advice is that “From Capital One, to Amazon, to the Privy Council Office, diverse organizations have determined that they can benefit from testing—so can your business.” (Bendle, Chen, and Soman, 2017, page )

Read: Neil Bendle, Katie Chen, and Dilip Soman, (2017) The Profitability of Proof, Ivey Business Journal, May/June 2017, http://iveybusinessjournal.com/the-profitability-of-proof/

 

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