In this video, get an explanation of cherry picking and hear about relevant examples in daily life.
- Did you know that companies that move into a new corporate headquarters are likely to fail? As explained in the Wall Street Journal, the HQ indicator suggests that when companies move its executives into lavish headquarters, it's time to sell the stock. Examples in the original article included Sales Force Tower, the Time Warner Center, and the AT&T Building. All examples of companies who had poor financial performance after moving into new corporate headquarters. Before you start selling your stock every time you see an announcement that a company is moving into a new building, you might want to look at the counter example provided by Bloomberg News.
Such as Amazon moving into new corporate headquarters in Seattle. Or countless other companies that moved into new buildings and performed quite well for decades. Cherry picking is the selective use of data to support one's position while ignoring other data that tends to counter one's opinion. This practice is quite common, and it's not always done with sinister intent. Even you, likely, have cherry picked. For example, imagine you walk into a meeting with your boss in which you plan to ask for a promotion.
To make your case you carefully choose what to highlight from your history at the company. While you'd be quick to bring up the deals you've closed, you'd be hesitant to mention the ones that you let slip away. Essentially, you're making your argument for a promotion based off the data that will be the most beneficial to your case while ignoring the past data that runs counter. The reason cherry picking is so prevalent is because it's so easy to do. We do it every day. When you're getting dressed for a date, you carefully select your best outfit to portray a certain image of yourself.
When you interview for a job and you're asked the question, "Tell me about yourself." Are you going to say anything that portrays you in a bad light? Like that client meeting you weren't prepared for or that last party you hosted? Definitely not. You tell the interviewer about your professional achievements and educational experience. Cherry picking is closely related to confirmation bias. A psychological tendency to view evidence in a way that supports our predisposed notions. In a corporate setting this could come up in a range of ways. For example, a positive assessment of an employee who you've mentored for months, where you ignored the few times they continued to underperform.
A view on the effectiveness of a certain promotion because you really believe in it, even though the hard data suggests it may not have been so effective. Fervent believe by an old school executive that casual Friday caused a decline in work performance, even though absenteeism on Fridays among your younger workers has been reduced after you institute the new dress code. As a manager at your firm, you question analytical results to avoid making decisions on cherry picked statistics. And while cherry picking can be easy to overlook, there are some useful ways of identifying a situation where someone might be cherry picking data.
I'll show you how to do that in our next case study.
- Qualitative vs. quantitative data
- Data analytics success stories
- Making predictions
- Asking the right questions
- Collecting data
- Understanding averages
- Sampling: pros and cons
- Cause and effect