Seeking Beta Testers for a Web-based Sales Opportunity Portfolio Analysis Tool

Incite! Decision Technologies has recently developed a simple yet sophisticated web-based sales opportunity portfolio analysis tool that is ready for beta testing. Now we're seeking parties that would be interested in participating at no cost and no obligation.

Specifically, we are looking for progressive sales managers in firms whose sales team pursues high value, low-frequency sales. Examples of target firms might be...

• Engineering, architecture & construction firms
• Professional service firms
• Capital equipment manufacturers
• Start-ups

The purpose of the tool is to provide

• Improved accuracy of revenue realization and timing forecasts;
• Guidance on how to allocate resources to maximize the likelihood of deal closure;
• Guidance on opportunity selection and prioritization.

Ultimately, you will be able to determine if the sales opportunities you are pursuing are worth the time, effort, and resources.

If you are interested in learning more or know someone who might be, please, contact me via LinkedIn message or send me an email from our web form.

The Power of Negative Thinking: “How do we know this opportunity is worth the time and effort?”

The sales process is an inherently risky business. It’s difficult to know if and when a deal will close, what clients really want regardless of what they have stated (i.e., the client may have failed to frame their own needs properly), and what competitors offer in price and quality of deliverables.

Compounding the external uncertainty, we often get in our own way by importing certain kinds of biases into our assessment of the value of the sales opportunities at hand. These biases can include…

• Unwarranted optimism or wishful thinking – personal enthusiasm or a natural disposition to believe that desired outcomes will most likely occur; or, inflating initial estimates of desired outcomes to appear more effective than is warranted;
• Sand-bagging – under reporting potential outcomes to appear heroic when better than anticipated outcomes materialize;
• False precision – reporting anticipated outcomes with an unjustified level of certainty, usually as a single-point estimate rather than a range;
• Availability – recalling values that are memorable, easily accessible, recent, or extreme;
• Anchoring – using the first “best guess” as a starting point for subsequent estimating;
• Expert over-confidence – failure of creativity or hubris (e.g., “I know this information and can’t be wrong because I’m the expert.”);
• Incentives – the SME experiences some benefit or cost in relationship to the outcome of the term being measured, adjusting his estimate in the direction of the preferred outcome;
• Entitlement – the SME provides an estimate that reinforces his sense of personal value.

Without bias-free assessments in our decisions to actively pursue sales opportunities, it's nearly impossible to know how to allocate sales and support resources effectively to maximize the likelihood of capturing sales in a profitable and efficient manner. In short, when given the opportunity to pursue multiple opportunities with limited resources, it’s often difficult to know if any given opportunity is worth the time.

As odd as it may sound in a culture that seems to demand almost endless optimism, the Power of Negative Thinking actually helps us to overcome our biases as well as inform us how to obtain better information about the external uncertainties we face. By “negative thinking” we do not mean cynicism or toxic nay-saying. Rather, we refer to a process that asks us to consider critically the opposite of what we too easily assume (or wish) to be true. While Negative Thinking could lead us to consider the effects of unfortunate outcomes or conditions (the opposite of desired outcomes) on sales opportunities...

The best laid schemes o’ Mice an’ Salesmen, Gang aft agley

...it could also lead us to consider the possibility of desirable outcomes or conditions (the opposite of the unfortunate) for situations that we often easily dismiss.

No, no, boy, that's no way to make a plane. That'll, I say, that'll never...fly!

But the Power of Negative Thinking goes beyond our merely considering what can happen. We must also consider the “why” and “to what degree” those things could happen. We can account for the “what,” “why,” and “to what degree” in a process called probabilistic reasoning. But that's the second step. The Power of Negative Thinking begins with accurately framing an opportunity, which requires that a sales team answer the following questions:

• What is the real opportunity? 
• What are our goals and objectives?
• What are the client's goals and objectives?
• What are the decision boundaries and open decisions?
• What are the sources of uncertainty? 

Answering these questions helps the team know that it has the right reasons in mind to pursue an opportunity and what constraints in their current level of knowledge limit their ability to make unambiguous decisions about what opportunities to pursue and how to go about pursuing them.

Probabilistic reasoning helps a sales team then answer these questions:

• What is the likely range of outcomes for the uncertainties? 
• What are the effects of uncertainties on sales goals, revenues, and profit? 
• How much risk do we face with each opportunity; i.e., how much could we lose by pursuing one opportunity over another?
• What insights can we create for contingency plans or options?
• How do we prioritize our set of current opportunities?

The effect of taking these two steps in a structured way reveals the Power of Negative Thinking so that the sales team can recognize when an opportunity is worth pursuing…or not. Ultimately, not only does the Power of Negative Thinking give the sales team a more accurate assessment of the current state and possibilities they face, they can also develop more effective contingency plans to increase the likelihood of achieving results their organization—and their clients—desire.

A Decision Analyst's View of Electoral Surprise

I turned off the television last night at 8 PM. Since I had an analytics problem to work on, I didn't want my attention divided, and I knew that clinging to electoral results was more neurotic than helpful. My attention at the moment was not going to change the results. So, I rolled up my sleeves and got to work.

At 12:30 AM, I turned my television back on...

As I watched the polling results roll in and followed the reactions of establishment pundits and the broader hoi polloi (from both sides) in social media, all I could think was, "What is going on here?" Over and over. I mean, Nate Silver was still giving better than 2:1 odds of a Clinton victory just before I turned off the TV. Could the situation really have been that different than assessed? Could things really have changed that quickly? At 4 AM, I finally captured some thoughts that I think should serve as object lessons for all of us, and not just in politics, but in business, too.

1. Never, ever believe your own spin. Humans love narratives that give them comfort. Unfortunately, almost all narratives are constructed from selected evidence that fits a preferred narrative.
2. Always question where your biases are coming from. You are biased. Until you recognize it, you will frequently be rudely embarrassed. 
3. There is no meaningful position in certainty. All beliefs about future events should be treated with degrees of belief. 
4. Even events that happened in the past are open to interpretation. The real issue about the facts of events is not so much whether events have occurred in the past or whether they will occur in the future. The real issue is our epistemic distance from the events. We generally don't know as much as we think we do.
5. We condition our beliefs on the evidence at hand. Thinking that a Clinton victory was highly probable was not a bad position to take. It made sense given much of the evidence. BUT, Prob(Clinton win) > 50% does mean Prob(Clinton win) = 100%! (I'm actually getting tired of explaining this. I'm getting tired of seeing people make this mistake and the effects it has in real life on real people. Probabilities are degrees of belief, not statements of fact.) Always, always, always consider the disconfirming evidence. 
6. Trump never showed an insignificant chance of winning. His victory was always probable. What I see and hear coming from those expressing shocked disappointment about the Clinton loss is that they didn't really explore and consider the edge cases that would lead to a Trump victory. Explore the edge cases. Explore aggressively. Keep exploring. 
7. Informed accuracy trumps false precision (pun intended). Don't be embarrassed to draw your prediction intervals wide. It's more honest, more informative, and will allow you to do a better job preparing contingency plans. When #6 is performed honestly and aggressively, it should lead you to make your prediction intervals even wider. It's better to be humble and recognize how little you know versus being sure and then being rudely surprised.
8. The evolving probability of win curves for this election resemble the curves associated with predicting that a given hypothesis among several is true when there are unaccounted for characteristics at play. Suddenly, a seemingly most likely explanation crashes to be replaced by a previously less likely hypothesis as the unrecognized characteristic manifests itself. This is a long way to say people get caught up in false dichotomies (or n-chotomies) for the possible explanations for what really is the case. It is almost always the case that more explanations are available than the limited set we originally conceived.
9. If something really weird happens and somehow the posted results at 4 AM reverse by the time I wake up, all of the above still applies, maybe more so.

Although Nate Silver was leaning in the wrong direction for predicting the outcome, his odds were actually more realistic and informed than many other pollsters who were giving 19:1 odds or better for a Clinton win.

New Book: Business Intelligence with R by Dwight Berry

If you are new to data science and learning the R language, let me recommend this new gem of a book, Business Intelligence with R, by my friendr (the term I just coined to describe R users who help each other), Dwight Barry: https://leanpub.com/businessintelligencewithr

Business Intelligence with R serves as a great cookbook that can save you hours of frustration learning how to get the basics going. Even if you're an old pro, the book serves as a handy desk reference.

Also, please consider the personal note that Dwight sent to all of his beta readers:

Perhaps most importantly, I've also decided to give all proceeds to the Agape Girls Junior Guild, which is a group of middle-school girls who do fundraising for mitochondrial disorder research at Seattle Children's Research Institute and Seattle Children's Hospital. While the minimum price for this book will always be free, if you're the type who likes to "buy the author a coffee," know that your donation is supporting a better cause than my already out-of-control coffee habit. :-)

Business Intelligence with R serves a greater cause.

Becoming a Business Analytics Jedi: An application of values-framed decision making

I will be speaking at the Georgia Tech Scheller College of Business on February 18, 2016 on the following topic:

In the current rush to adopt data-driven analytics, discussions about algorithms, programming tools, and big data tend to dominate the practice of business analytics. But we are defined by our choices, our values, and preferences. Data and business analytics that do not start with this recognition actually fail to support the human-centered reason for decision making. This is the way of the Sith. A Jedi, however, knows that framing business analytics in terms of the values and preferences of decision makers, and the uncertainty of achieving those, employs the tools of decision and data science in the wisest way. In this discussion, we will think about the principles of high quality decisions, how to frame a business analytics problem, and learn how to use information in the most efficient way to create value and minimize risk.

The discussion will include a demonstration of the Analytica modeling software.

If you're in the Atlanta area, I would love for you to join me in the discussion.

A special thanks to Dr. Beverly Wright for organizing this event!

Interview with Atlanta Business Radio

Recently, Brian McCarthy and I had some fun being interviewed by Ryan McPherson of Atlanta Business Radio.

You can listen to the interview here or here (starts @19:39).