The Lares Institute Blog

Information Superiority—The CEO’s Path to Improved Decision-Making.

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The economic escapades of recent times, coupled with the information overload that every executive faces, places CEOs in the daunting and demanding position of having to process more information to make decisions at a time where they have diminished resources available to assist them.  The constant need to do more with less requires CEOs to take a proactive role to prevent their companies from being consumed by “Big Data”, while simultaneously harnessing the power of information to aid executive decision-making.

Simply focusing on Big Data will not help executives achieve what they must, which is to use information in a superior way to facilitate getting the right information, to the right people, at the right time in an efficient way.  A comprehensive and focused strategy must be utilized if executives want their companies to achieve significant success, and that strategy is Information Superiority.  The cyber security aspects of Information Superiority have been discussed in earlier posts, as have the contours and history of Information Superiority, and this post illustrates the importance of Information Superiority to executive decision-making by: examining the core function of executives in both the public and private sector; briefly summarizing Information Superiority; reviewing lessons learned from the public sector; and illustrating why Information Superiority, not Big Data, is the solution for today’s executives.

 What is an Executive’s Job?

Executives have many roles in a company, but as illustrated by a Harvard Business Review Article on executive decision-making, there is one key distinction between executives and non-executives in organizations:

The job of a manager is, above all, to make decisions. At any moment in any day, most executives are engaged in some aspect of decision making: exchanging information, reviewing data, coming up with ideas, evaluating alternatives, implementing directives, following up.

To climb the corporate ladder and be effective in new roles, managers need to learn new skills and behaviors—to change the way they use information and the way they create and evaluate options.[1]

Cornell’s Johnson Graduate School of Management offers a variety of courses in executive decision-making, and in describing its “Executive Decision Making” class, it demonstrates the role of data and decision-making:

In this course, participants will learn how to apply formal decision-making processes in order to reduce risk and maximize benefit. Learn best practices and techniques for gathering data and making critical decisions with limited time and resources.

There are also examples from the public sector that emphasize the importance of executive decision-making and the key role of information, including from the Naval War College in a text entitled “Executive Decision Making”:

Making high-level defense decisions is a large part of being a senior military officer or career defense civilian.

These kinds of choices will push you into new, unfamiliar circumstances in which procedure and experience are no longer sufficient unto themselves. How do you decide whether to advocate producing a next-generation weapon or to push instead for a complete technological leap forward? This text will help you answer that kind of question by providing a structured approach to problem solving and decision making. It will help you identify and bound not only what is known and unknown, but also what ingredients are necessary to make a good decision.

The key is to treat experience and lessons-learned as one source of data or evidence to bring to bear on a decision, along with all other useful information from other sources. (emphasis added).

There are two key points to focus on from these examples—(1) the executive’s job, whether public or private sector, is to make decisions, and (2) efficiently getting the right, not just more, information is a critical part of executive decision-making.

 What is Information Superiority?

The Department of Defense defines Information Superiority as “A relative state achieved when a competitive advantage is derived from the ability to exploit an ‘Information Advantage’”, and as “The ability to develop and use information while denying an adversary the same capability.”  Under DoD doctrine, an Information Advantage is achieved when one competitor outperforms its competitors in the information domain.  In order to implement Information Superiority, according to the DoD, there must be behavioral and technical modifications to how information is collected and processed, so it can drive value.

Notice that the focus isn’t exclusively on gathering more information, or just technology, but rather on improving performance regarding information, and making behavioral and technical changes to how information is gathered and processed.  In short, the goal of the public sector is to efficiently create value by gathering intelligence that can be appropriately and quickly utilized—i.e. actionable intelligence.

For the private sector, Information Superiority is a doctrine that focuses on efficiently getting the right information, to the right executives, at the right time, to: increase profits; reduce costs; increase cybersecurity; optimize risks; reduce the chances of corporate espionage; and mitigate the potential for brand damage based upon a cyber incident.  The implementation of Information Superiority has been covered in prior posts, and the key steps are: understanding what information your company has; creating an information governance structure made up of senior stakeholders; creating a framework that classifies information based upon its value and sensitivity to the organization; and making systematic behavioral changes to how information is collected and processed, so that information is appropriately and efficiently shared with key stakeholders.

Lessons Learned from the Public Sector.

An example that illustrates this point is 9/11.  As discussed in Calling All CEOs–Are You Ready to Defend the Battlefield of the 21st Century?, Al Qaeda was able to create an information imbalance (a situation where one party uses information to take advantage of another party’s weaknesses) by gathering information (regarding the screening standards in airports), and use that information to create an asymmetric threat—the terrorist attack that followed.  During the review by the 9/11 Commission, one key focus was understanding what improvements could be made to the federal government’s systems to prevent a similar terrorist event in the future.  When making their recommendations in the Report, the Commission’s focus was not on gathering more information, but rather the behavioral and organizational aspects of information.

In each of our examples, no one was firmly in charge of managing the case and able to draw relevant intelligence from anywhere in the government, assign responsibilities across the agencies (foreign or domestic), track progress, and quickly bring obstacles up to the level where they could be resolved. Responsibility and accountability were diffuse.

The agencies cooperated, some of the time. But even such cooperation as there was is not the same thing as joint action. When agencies cooperate, one defines the problem and seeks help with it. When they act jointly, the problem and options for action are defined differently from the start. Individuals from different backgrounds come together in analyzing a case and planning how to manage it.

In our hearings we regularly asked witnesses: Who is the quarterback? The other players are in their positions, doing their jobs. But who is calling the play that assigns roles to help them execute as a team?

In short, two key failings were: a failure of leadership to define goals that then drove the gathering of information (not the other way around); and a failure to act jointly across agencies and share relevant information.

Big Data Is Not the Answer—Information Superiority Provides a Solution for Your Company.

Discussions about Big Data are the rage these days, but Big Data is not the solution for executives, and at some level is part of the core problem for companies.  Definitions of Big Data abound, but they all at some level focus on the volume and velocity of information, and how the information can help define business goals.

Big data is a popular term used to describe the exponential growth, availability and use of information, both structured and unstructured. Much has been written on the big data trend and how it can serve as the basis for innovation, differentiation and growth.
According to IDC, it is imperative that organizations and IT leaders focus on the ever-increasing volume, variety and velocity of information that forms big data.[2]

The ever-increasing volume and velocity of data is an issue that in context must be addressed, but this definition illustrates that Big Data is not the answer for the broader concern of executive decision-making.  Indeed, the lessons of 9/11 illustrate that the problem wasn’t having too little information, or having information drive decisions, but rather that there was a lack of leadership and clarity of goals that precluded the relevant people from efficiently identifying, drawing, gathering, and sharing the relevant information so that the information could be used in a superior way.

This is the same issue the private sector faces.  Similar short-comings have caused some traditional businesses to fail because threats to business models were not perceived–think of big box video rental stores and the impact that online content distribution has had on this industry.  Moreover, if you look again at the materials on executive decision-making discussed above, as well as the 9/11 Commission Report, the issue is apparent.  Whether it is expressed as “exchanging information”, learning “best practices and techniques for gathering data and making critical decisions with limited time and resources”, identifying a “quarterback” to set goals and have accountability for the team, being “able to draw relevant intelligence from anywhere”, or learning “what ingredients are necessary to make a good decision”, the issue for the public and private sector is the same—making behavioral and organizational changes that facilitate the goals of the organization to efficiently get the right information, to the right people, at the right time.

A Non-Delegable Duty.

There has been discussion in the Information Age about who should help facilitate the use of information.  Some believe that it is the CIO’s responsibility, while others talk about creating a new role, such as a Chief Digital Officer.  The reality is this is a duty that must fall to the CEO, as the “quarterback” of the company.  This is not to say that other executives—indeed all other executives—are not critical to the success of Information Superiority in your organization, but the tone from the top must be set by the CEO so that the goals of the organization drive information gathering and sharing, not the other way around.  This will help your harness the power of information in a way that will help drive your company’s goals in an efficient way that promotes joint action among the key executives.  Using other methods may drive some value, but they will not efficiently deliver the value that Information Superiority can.  For today’s CEO, anything less can lead to a waste of resources and future business opportunities.

[1] The Seasoned Executive’s Decision-Making Style, Kenneth R. Brousseau, Michael J. Driver, Gary Hourihan, Rikard Larsson, Harvard Business Review, February 2006.



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