{"id":48338,"date":"2022-10-21T10:42:12","date_gmt":"2022-10-21T08:42:12","guid":{"rendered":"https:\/\/www.getsmarter.com\/blog\/?p=48338"},"modified":"2025-11-25T13:51:17","modified_gmt":"2025-11-25T11:51:17","slug":"moving-from-hippo-based-decision-making-to-a-more-data-driven-approach","status":"publish","type":"post","link":"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/","title":{"rendered":"Moving From Hippo-Based Decision Making to a More Data-Driven Approach"},"content":{"rendered":"\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"Why You Should Move to Data-Driven Decision Making | MIT Sloan\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/4TPnpr5mmD0?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>What does a hippo have to do with decision making? If we\u2019re talking about the animal, then not much. But if we\u2019re talking about a HiPPO, otherwise known as the \u2018highest paid person\u2019s opinion\u2019, that\u2019s a different story. Companies are changing the way they make decisions; moving away from guesses and intuition, they\u2019re using gathered data to make fact-based decisions.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-transcript\">Transcript<\/h2>\n\n\n\n<p>Humans have always had to make important decisions, often in groups. And for most of history, they\u2019ve used the same basic technique \u2013 whether they were deciding whether to have their village go to war with the neighboring village, or whether to introduce a new product into the marketplace.<\/p>\n\n\n\n<p>What they would do is get the group of the wise people together, sitting around a table, and everyone would explain why they thought one decision or the other should be made, and after some period of debate, and perhaps even a little bit of evidence, they would go with the HiPPO.<\/p>\n\n\n\n<p>Well, what\u2019s the HiPPO? The HiPPO is an acronym that our friend Ron Kohavi at Microsoft came up with and it stands for the highest paid person\u2019s opinion. That\u2019s right, after all the debate, one person \u2013 the chief \u2013 would make the decision based on his or her own decision-making instincts.<\/p>\n\n\n\n<p>Well, that worked tolerably well for lots of decisions, but now we\u2019re moving from HiPPO-based decision-making to data-driven decision-making. And a great example is what Jeff Wilke taught me. Jeff is the head of Worldwide Consumer at Amazon. He\u2019s also a Sloan grad, so every once in a while he comes back and gives me a few tips.<\/p>\n\n\n\n<p>I remember, some time ago, he came to my office and we were talking about data-driven decision making and the way things were evolving at Amazon. And before we really got into it, he said, \u201cHey, let me bring up Amazon. I want to take a look at your website.\u201d And I said, \u201cOkay, fine\u201d. And so I brought up Amazon on my web browser, and he looked at it for a second, and he says, \u201cAh, you\u2019re in Group B.\u201d And I said, \u201cWhat do you mean I\u2019m in Group B?\u201d He goes, \u201cWell, we\u2019re running an experiment right now on you and millions of other people. Group A has the shopping cart on the left and Group B has the shopping cart on the right.\u201d And sure enough, I looked at the screen and there was a little Amazon shopping cart and it was over on the right side of my screen. I said, \u201cWell, what difference does that make?\u201d And he said, \u201cWell, at Amazon, there was a debate whether or not it made more sense to have the shopping cart on the left or the right. And we had some experts telling us, oh, for psychological reasons it makes more sense to have it on the left or the right. But we just shut down that debate very quickly. We said let\u2019s run an experiment.\u201d<\/p>\n\n\n\n<p>And so that\u2019s what they did right then and there. I found out a couple of weeks later that it turned out that having the shopping cart on the right was worth a few extra tenths of a percent in terms of getting people to not abandon the shopping cart.<\/p>\n\n\n\n<p>Who could have guessed that?<\/p>\n\n\n\n<p>Probably no expert could\u2019ve. But by doing an experiment and gathering data from millions of customers, they were able to find out that it\u2019s slightly more likely that people consummate their purchase if they have a shopping cart on one side or the other. These kind of A\/B tests are ubiquitous \u2013 not just at Amazon, but at every major digital company. And now, companies across the world are using this experimental approach to gather data. And once they have enough data, they can make a fact-based decision instead of one based on just guesses and intuition.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What does a hippo have to do with decision making? If we\u2019re talking about the animal, then not much. But if we\u2019re talking about a HiPPO, otherwise known as the \u2018highest paid person\u2019s opinion\u2019, that\u2019s a different story. Companies are changing the way they make decisions; moving away from guesses and intuition, they\u2019re using gathered [&hellip;]<\/p>\n","protected":false},"author":74,"featured_media":48349,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[1],"tags":[122],"article-format":[],"class_list":["post-48338","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-career-advice","tag-business-management"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.2 (Yoast SEO v26.2) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Moving From Hippo-Based Decision Making to a More Data-Driven Approach - GetSmarter Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Moving From Hippo-Based Decision Making to a More Data-Driven Approach\" \/>\n<meta property=\"og:description\" content=\"What does a hippo have to do with decision making? If we\u2019re talking about the animal, then not much. But if we\u2019re talking about a HiPPO, otherwise known as the \u2018highest paid person\u2019s opinion\u2019, that\u2019s a different story. Companies are changing the way they make decisions; moving away from guesses and intuition, they\u2019re using gathered [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/\" \/>\n<meta property=\"og:site_name\" content=\"GetSmarter Blog\" \/>\n<meta property=\"article:published_time\" content=\"2022-10-21T08:42:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-11-25T11:51:17+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.getsmarter.com\/blog\/wp-content\/uploads\/2022\/10\/getsmarter_blog_header-banner_YALE-DBS-1-3.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1500\" \/>\n\t<meta property=\"og:image:height\" content=\"844\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Shameel Mohanlal\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"GetSmarter Staff\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/#primaryimage\",\"url\":\"https:\/\/www.getsmarter.com\/blog\/wp-content\/uploads\/2022\/10\/getsmarter_blog_header-banner_YALE-DBS-1-3.jpg\",\"contentUrl\":\"https:\/\/www.getsmarter.com\/blog\/wp-content\/uploads\/2022\/10\/getsmarter_blog_header-banner_YALE-DBS-1-3.jpg\",\"width\":1500,\"height\":844},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.getsmarter.com\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Blog\",\"item\":\"https:\/\/www.getsmarter.com\/blog\"}]}]}<\/script>\n<meta property=\"og:video\" content=\"https:\/\/www.youtube.com\/embed\/4TPnpr5mmD0\" \/>\n<meta property=\"og:video:type\" content=\"text\/html\" \/>\n<meta property=\"og:video:duration\" content=\"193\" \/>\n<meta property=\"og:video:width\" content=\"480\" \/>\n<meta property=\"og:video:height\" content=\"270\" \/>\n<meta property=\"ya:ovs:adult\" content=\"false\" \/>\n<meta property=\"ya:ovs:upload_date\" content=\"2022-10-21T08:42:12+00:00\" \/>\n<meta property=\"ya:ovs:allow_embed\" content=\"true\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Moving From Hippo-Based Decision Making to a More Data-Driven Approach - GetSmarter Blog","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.getsmarter.com\/blog\/moving-from-hippo-based-decision-making-to-a-more-data-driven-approach\/","og_locale":"en_US","og_type":"article","og_title":"Moving From Hippo-Based Decision Making to a More Data-Driven Approach","og_description":"What does a hippo have to do with decision making? If we\u2019re talking about the animal, then not much. But if we\u2019re talking about a HiPPO, otherwise known as the \u2018highest paid person\u2019s opinion\u2019, that\u2019s a different story. 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