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June 22, 2015
“Grounded truth” in business
By: Mark McDonald

I’ve been thinking about the idea of grounded truth since I heard Ed Boyden, Professor at the MIT Media Lab and the MIT McGovern Institute, speak recently about mapping the brain and complex systems. (Here is one of Boyden’s TED talks to give you an idea of the topic.)

During his talk, Boyden used the term “grounded truth.” It’s a phrase with a simple and powerful definition. Grounded truth is an assumption-free understanding of the world. Grounded truth creates an unbroken line between event and effect—a connection relied on by science for explanation and exploration to find other truths.

That got me thinking about grounded truth in business.

Grounded truth is essential in science. Business, on the other hand, was thought to be too complex, ever-changing and dynamic to be explained by science. That is not a criticism, it’s just a recognition that truth is elusive in complex systems—the web of interrelationships, causes and effects we find in business ecosystems.

Boyden’s work is on the complex systems and behavior of the brain demonstrating the potential for finding grounded truth in business. Boyden discussed the approaches and innovations his team uses to find truths in the brain. Based on that talk, here are some ideas executives should consider to find grounded truth in the digital age.

A case for grounded truth in business

Business decisions rely on information. Executives combine information with experience to set goals, allocate resources, take action and judge performance. But executives have to work with perceived information as opposed to grounded truths. So the effectiveness of decisions has to rely on the accuracy of executives’ assumptions and the quality of their judgment.

Can we do better than that in the age of digital?

Prior to digital technology, information was expensive to collect and difficult to manage. Finding reliable relationships among apparently disparate pieces of information makes it hard to understand the innate relationships in business. When executives don’t understand, they instead impose structure and control. That is part of the rationale for measurement and control techniques such as Total Quality Management and Business Process Reengineering.

Analytics, Big Data, cloud, mobility and sensor technologies change the nature of information and information management. Digital lowers the cost of collecting, analyzing, storing and deploying information. It is now possible to think about finding and acting on grounded truth, provided one takes the right approach.

I believe it is possible for organizations to develop the capabilities for capturing, investigating and testing grounded truths. These are not new versions of “boiling the ocean” through big data initiatives or frantic A/B testing. They are taking approaches found in science and bringing them to the study of grounded truth in business.

Finding grounded business truths

Boyden’s talk concentrated more on how you find grounded truths—in his case related to brain research—than on the truths themselves. Meaning, there is a technique one can learn and follow. Here are some of my thoughts about techniques one can use to find grounded business truths.

  • Discovering grounded truth requires building insight rather than boiling an ocean of data. Grounded truth rests on understanding causalities. This requires analytics to go beyond highlighting correlations in business.

  • At the beginning, do not over emphasize or impose a structure on the problem space. Recognize that any structure embeds bias and employs assumptions that cloud grounded truth, but you need a place to start. Prepare for the problem structure to change as truths emerge. Boyden mentioned tiling trees as a technique to recognizing emerging structures.

  • Segment investigations—the smaller and more fundamental the better. Human minds seek to understand complex interactions and meaning by making assumptions and applying analogies. Instead of trying to understand the system or problem in its entirety, start with small and specific parts of it.

  • Observation is critical. You discover truth more than you create it. How will you recognize change? Look beyond obvious connections. Explore for indirect but reliable observations. For example, the MIT team needed to observe electrical brain activity without destroying brain tissue. They found and applied gene therapy to create brain cells that emitted light based on their electrical activity.

  • Experimentation is the process. Crafting the right way to explore a part of the problem structure involves more than trying a bunch of stuff and seeing what works. Random A/B testing or “provide and pray” approaches are useful but they are not experiments that lead to deeper understanding of why things happen.

  • Extension expands understanding, building grounded truth upon other grounded truths. This forms the basis for digital business, often expressed in algorithms, rules and relationships.

Grounded truth is easy to explain but challenging to find and manage without digital tools. The idea of finding assumption-free and repeatable associations that explain the nature of business presents one of the revolutionary opportunities made possible by digital technologies—and a subject for further discussion and innovation.

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