Let's Talk About Insight

Redefining Insight For Clarity

Sellers frequently use the term "insight" to promote their tools and platforms. Buyers, in turn, often hear this word, hoping it signifies genuine value. However, a complication arises. The term "insight" can become a vague umbrella, employed when sellers struggle to articulate the specific, tangible benefits of their offerings. This ambiguity leads to buyer suspicion and raises a critical question: How can organizations cut through the noise and ensure that proclaimed "insights" actually translate into better, actionable decisions? The answer lies in adopting a precise definition for insight and demanding that sellers demonstrate this specific utility clearly.

The Challenge of Vague "Insights"

The marketplace for tools and platforms often buzzes with the promise of "insight." Yet, what does this term truly signify in a sales context? Its frequent use can mask a lack of clarity, creating difficulties for buyers seeking real value.

Sellers' Use of Ambiguous Language

Sellers sometimes deploy the word "insight" as a persuasive term. They use it to suggest that their tool provides a valuable platform, especially when they cannot pinpoint the exact nature of this value in a concrete way. The word "insight" then functions as a catch-all. It hints that "something may be there," some hidden gem of understanding that the tool will magically uncover. This lack of specificity can, quite understandably, make buyers cautious. Does "insight" mean new data, better analytics, or something else entirely? Without a clear articulation, buyers may question the substance behind the claim.

Parallels in Information Asymmetry

This situation, where vague terms stand in for concrete information, is not unique. There is considerable research on the use of signals in markets where information is imbalanced. Nobel Prizes have recognized studies in this area. George Akerlof's "market for lemons" theory, for example, describes how, in the used car market, sellers know more about the car's quality than buyers. This information asymmetry can lead to a market flooded with poor-quality cars because buyers cannot easily distinguish them from good ones. Similarly, Michael Spence's job market signaling theory explains how prospective employees use proxies, such as university degrees. These degrees signal skill and motivation when direct, sufficient information about a candidate's abilities is lacking. In essence, when clear information is scarce, people rely on signals. The term "insight," when used imprecisely by sellers, can act as such a signal—a placeholder rather than a clear indicator of value. This warrants scrutiny from buyers.

A Clearer Path: Defining Actionable Insight

To navigate the ambiguity, a more rigorous understanding of insight is necessary. Fortunately, a compelling and practical definition exists, offering a benchmark for evaluation.

The Proposed Definition

Let us consider this definition: An insight is a piece of data that allows you to make a decision that you could not make before. This statement provides a clear, functional understanding of what an insight should deliver. It moves beyond vague promises and anchors the concept of insight to tangible outcomes: new data leading to new decision-making power.

Why This Definition Matters

This definition proves helpful for several reasons. It immediately establishes a high bar for what qualifies as an insight. It shifts the focus from the mere presence of data or analytics to the impact of that data. Can you act differently because of it? Can you choose a path previously hidden or unavailable? If the answer is yes, then you have a genuine insight. This clarity helps organizations distinguish between interesting information and truly valuable, decision-driving data.

The Non-Negotiable: Data Must Drive Decisions

The power of the proposed definition hinges on a fundamental principle: data’s primary role is to inform and enable decisions. If data fails this core purpose, its collection and analysis become questionable activities.

Data's True Purpose

The first key strength of this definition is its insistence that data must matter to a decision. Information might be interesting, patterns might be observable, but if they do not equip an organization to make a choice, to act, or to change course, they do not constitute an insight by this standard. All data an organization collects should serve decision-making. This direct link ensures that data gathering efforts remain focused and purposeful.

The Harm of Purposeless Data Collection

What happens if an organization gathers data that does not influence any decision? This practice is not harmless. It actively wastes resources. Time, money, and effort pour into collecting, storing, and perhaps analyzing data that offers no functional return. This is a direct drain on an organization's capacity, diverting resources from activities that could yield actual value. If data elements do not contribute to making choices, their collection should be critically re-evaluated. Should we continue to invest in acquiring information that leads nowhere?

The Buyer's Mandate: Demand Demonstrable Value

Armed with a clear definition of insight, buyers can transform their interactions with sellers and their approach to evaluating new tools. They can shift from accepting vague claims to demanding specific, demonstrable value.

What to Ask Sellers

When assessing a new tool or platform, buyers should press sellers for clarity. The seller needs to articulate precisely how their offering meets the standard of a true insight. Specifically, they should explain two critical points:

1. How is the data provided by this tool distinct? Has it not been collected in another form elsewhere within the organization?
2. Crucially, how does this data allow the buyer to make a specific decision they could not make before its availability?

These questions move the conversation beyond features and into the realm of tangible impact on decision-making processes.

The Benefit of Insisting on Specificity

Buyers who insist on this level of specificity achieve a significant advantage. They force a clear articulation of value. This focus on what data is actually presented and how it directly impacts decisions can reduce substantial waste in the buying process. It helps ensure that investments in new tools are directed towards solutions that genuinely enhance an organization's ability to act decisively and effectively, rather than merely accumulating more data.

Charting a Course for Clarity

Ultimately, the term "insight" should represent more than a hopeful aspiration or a marketing buzzword. By adopting the definition of an insight as data that enables a previously impossible decision, organizations and buyers empower themselves. This standard encourages a disciplined approach to data. It prompts critical questions about data collection and tool acquisition.

For buyers, this means engaging with sellers more critically. Ask them to demonstrate, with specifics, how their tool will provide data that directly leads to new decision-making capabilities. For organizations, it means fostering a culture where data serves action. Is the information we gather changing how we operate or the choices we make? If not, it is time to reassess. This commitment to actionable insight will lead to more efficient use of resources and, importantly, better decisions.