And by “squashed”, it means that a path that might actually be right for a large firm might be a very wrong path for a mid-size firm, or a boutique. Moreover, even if you’re a conservative type who is looking for a conservative approach – sometimes the “safe” call isn’t the one you might think.
Consider a specific NFL example from September 15. The Carolina Panthers were 3 points ahead of the Buffalo Bills with under 2 minutes to go in the game, and the Bills have no timeouts remaining. The Panthers had the ball deep in Buffalo territory, and it was 4th-and-1. 2 basic options were at this Dinosaur Crossing:
1. Attempt a short FG, go up by 6 (instead of 3) if successful.
2. Go for the first down, attempt to gain 1 yard.
The “safe” option is …? Old-school football thinking – the dinosaur parade – would say #1, and that’s exactly what the Panthers did. Result: Bills get the ball, score a TD, kick the XP, win the game. (For fans of football analytics, a similar but not identical fact pattern occurred at the end of the Tampa Bay/New Orleans game, with Coach Schiano choosing to following the Dinosaur Parade – and also losing.)
What was the optimal call for the Panthers? We analytics folk will argue, based on probability tables (read: key metrics), that under those precise conditions, the optimal choice is to go for the first down. Why? Success would mean instant victory (running the clock out), and failure had the likely outcome of putting the Bills in a position where they would need to conduct a long drive to, most likely, either lose or tie the game with a FG – still allowing the Panthers a chance to win. Yes, a winning Buffalo TD would’ve been possible in a Panthers failed “go-for-it” attempt as well, but a TD would not have been required for Buffalo to stay alive – a FG attempt would’ve been a viable fallback. Instead, the Panthers took a FG, conceivably gave up field position (by having to kick off to Buffalo), and forced Buffalo into a situation where their only viable option was to go for a winning TD (with the extra point).
Under either #1 or #2, the analytics show that the Panthers were still very likely to win the game. A Bills victory was unlikely either way, but the analytics might’ve lead a truly risk-averse Panthers team to a different decision.
It’s the same for many of your own business decisions, particularly involving your firm’s marketing. The best decision to reach your particular goal, whatever that may be, is often hiding behind the data. Optimal decisions are not always self-evident, they’re certainly not always consistent with “what’s always been done”, and they’re frequently counter-intuitive.