CEO’s Blog

"We understand life backwards, but live it forwards." - Soren Aabye Kierkegaard (Danish philosopher and theologian, 1813-1855)

"We don’t like uncertainty. We have a need to understand and make sense of events. We refuse to accept the unknown. We therefore seek explanations for why things happen." - Seeking Wisdom, page 91.

We see this all the time in the media. Experts can always look back at events and tell us why they think they happened and how it should have been obvious that the event was coming. The current financial meltdown is one example. Everybody’s an expert.

The problem is that we don’t take into account chaos and randomness. There are a lot of books out there about human irrationality right now, so I won’t go into too much detail. Check out Fooled By Randomness by Nassim Taleb.

Here at Bodybuilding.com, we were victims of this error in one of our leadership meetings.

Each Wednesday we meet to check out the latest customer loyalty numbers (net promoter scores, etc.), customer feedback, customer success stories, and much more. We do this to make sure we all know how our customers are feeling, what problems they are having and what they want. It’s the most important thing we do!

One week we pulled up our latest customer loyalty rating and noticed that it dropped. Ugh! So we immediately started asking ourselves why it happened. We came up with all sorts of answers.

“It’s that change we made to one of our customer service processes! I knew it!”

“We ran out of samples last week in the warehouse again!”

“The holiday messed up the shipping times since FedEx didn’t deliver on Monday, and customers are mistakenly blaming us for the delay!”

We thought we had it all figured out. How smart we are!

Then we noticed something funny. We were looking at the wrong chart. We were not looking at the customer loyalty SCORE, but the number of customers that rated us this week. The number of customers that rated us went down (it fluctuates all the time) and we thought we were looking at a chart showing that our customers were not as happy with us this week.

Then we looked at the correct chart. Customer ratings actually WENT UP this week!

I immediately laughed. We fell victim to one of the mental errors that I’m always reading about. We thought everything made sense.

Does this happen to you?

This entry was posted on Wednesday, October 8th, 2008 at 12:16 pm and is filed under CEO Thoughts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.