Posts Tagged ‘Douglass Hubbard’

Avoid false precision

Tuesday, May 22nd, 2012

It is almost standard practice nowadays for presentations to use precise numbers that are computations from a spreadsheet or averages from a lot of surveys, or that are calculations from various models, plans, or estimates. In many cases, authors use numeric representations that imply much more precision than they should. Even though we know our planning process is only accurate to within 20%, we present multi-year contract prices for uncertain business endeavors down to the dollar (for example, $1,650,745). We claim that customer satisfaction has improved 23% when our survey is based on subjective assessments of 10 different customer satisfaction questions where the answers vary from 1 (very satisfied) to 5 (very dissatisfied).

(more…)