Rethinking Averages: A Smarter Approach to Data Interpretation
Did you know that relying solely on averages can lead to misguided decisions, especially in critical situations? Understanding the nuances behind data interpretation can be a game changer in both personal and professional contexts.
In March 2022, I received the life-altering diagnosis of stage 3C colon and rectal cancer. Within days, I learned that the cancer had already penetrated the walls of my colon and spread to several lymph nodes. Faced with a survival rate of about 50% over five years, I was paralyzed by fear. At 39 years old, I found myself grappling with the stark reality that my chances of survival were akin to flipping a coin. However, as I delved deeper into my situation, I realized that I was more than just a statistic.
Are You Looking at the Right Data?
This experience prompted me to reflect on how we use averages, particularly during pivotal moments in our lives. As a management consultant, my role often involves dissecting data to uncover insights that help clients make informed decisions. This led me to three critical questions about averages that I believe everyone should consider:
- Is the average the right measure?
- Am I focusing on the right average?
- What am I missing by concentrating on the average?
Is the Average the Right Measure?
When designing a product or service, it’s common to aim for broad appeal. However, there are instances where the average can be misleading, especially in risk management. Take the Burj Khalifa, for example. While Dubai experiences an average of 52 earthquakes annually, most are minor. Yet, the developers designed the tallest building in the world to withstand a 7.0 magnitude earthquake. Had they only considered the average earthquake intensity, the consequences could have been dire.
This principle applies to our everyday decisions as well. For instance, I once chose a family-friendly horror movie based on the average age of my household, which is 23. My six-year-old, however, did not share the same sentiment and struggled to sleep that night. Clearly, the average was not the right measure in this case.
Am I Focusing on the Right Average?
Even if the average is the correct measure, it’s crucial to ensure you’re focusing on the right one. For example, I’ve never witnessed an Automated External Defibrillator (AED) in action, despite knowing where they are located in my office and various restaurants. Statistically, there are about 200 cardiac arrests in public places in the U.S. daily, but only 10% of bystanders use an AED.
The average usage rate may seem low, but the potential impact of having an AED accessible is significant. Every minute after a cardiac arrest decreases the chance of survival by 7-10%. If an AED is used within the first minute, survival rates can soar to 90%. In this scenario, focusing on the right average can make a life-or-death difference.
Similarly, my cancer survival statistics were based on broad data that included older individuals and varied treatment plans. I learned that over 80% of colon and rectal cancers occur in those over 49, which made my situation unique. Thus, relying on averages without context can lead to misguided conclusions.
What Am I Missing by Focusing on the Average?
In my first job at a real estate investment firm, we learned the hard way about the dangers of focusing solely on averages during the subprime mortgage crisis. Companies that survived did so because they analyzed worst-case scenarios rather than just average default rates. Ignoring outliers can lead to missed opportunities for valuable insights.
Dr. Jeffrey Rediger, in his book Cured, explores cases of spontaneous recovery in terminally ill patients. These “miracle cases” often defy statistical norms and are frequently dismissed as mere luck. However, what if we studied these outliers more closely? They could provide insights that might not fit the conventional mold but could be life-changing for individuals.
When we rely solely on averages, we risk receiving average medical treatment instead of personalized care tailored to our unique needs. I was fortunate not to be a terminal case, but I realized that my 50/50 odds were not relevant to my specific situation. I set my sights on a different survival metric: 100%.
Conclusion
Takeaway: Always question the relevance of averages in your decision-making process.
As you navigate your own challenges, consider how averages may shape your understanding and choices. Are you focusing on the right data? What insights might you uncover by looking beyond the average?