Evidence-Based Decision Making

Decision making in business is a key skill, and there are many models to help you. This article discusses Evidence-Based Decision Making and how it has moved from the scientific arena to the business world.


Definition of Evidence-Based Decision Making

To run a successful business, you need to be able to make good decisions that are supported by accurate data. Evidence-Based Decision Making in business refers to addressing business issues with a logical and objective approach, using data and evidence. It evolved from medicine where experiments and data are used to develop theories and help in decision making. The issue many businesses face is not that they don’t have the data, it is that they have too much and don’t know what to do with it.

Making a Causal Argument

The main aim of Evidence-Based Decision Making is that, given all the available data and evidence, would everyone make the same decision? Does the evidence presented effectively push you towards the final outcome? This is known as a ‘causal argument’ – the evidence causes you to come to the conclusion.  The thought process is “If I choose option ‘x’, then outcome ‘y’ will happen.” Evidence-Based Decision Making delivers the information to support the causal argument and to establish the desired result, based on our initial option choice. The more evidence we have, the greater our confidence in the likelihood of the outcome.

Types of Evidence

Any evidence being used to make a decision needs to be relevant. This means that it will help in making the decision and moving the causal argument along to the outcome. Evidence that is not relevant is just overloading the decision maker with extraneous ‘noise’ and will not help the process.

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