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Data Governance

The Statistician Who Drowned (in a River with Average Depth 3 Feet)

The Problem

A statistician drowned crossing a river with an average depth of 3 feet. How? Parts of it were 12 feet deep. Averages hide the extremes. Your average customer spends $50—great! Except 90% spend $5 and 10% spend $500. Those are two completely different customers who need different strategies. But if you only look at the average, you optimize for nobody. Same in manufacturing: average defect rate of 2% sounds fine until you realize one production line is at 0.1% and another is at 15%. Averages smooth out the truth. They make you comfortable when you should be alarmed. They hide the gold (power users) and the disasters (broken processes).

The Principle

Dig into the distribution, not just the average. Look at medians, percentiles, outliers. Segment your data—what's the average for each customer type, region, or product line? In manufacturing, you wou...

Action Steps

1.Step 1 content...

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