Warning – Don’t Always Trust the Data! It Can Cost You Your Business

Data is everywhere these days. Increasingly, it isn't just data, it is "big data", although what exactly is the difference between small data, medium-sized data and big data is in itself a bit of a mystery.

But there is no doubt we are surrounded by more of it than ever before. I can see how many successful passes my favourite footballer made in the match last week; which other artists I might like on Spotify or Amazon based on the profile of similar listeners / buyers; and of course instantly check out my suppliers on multiple dimensions, from their annual reports to their LinkedIn, Glassdoor or global news media profiles.

Overall, this is all great news for us as individuals and in our working lives. But a court case last week showed some of the dangers of this world. Taylor and Sons Ltd, an engineering firm in Wales which employed 250 people and had been in existence for over 120 years, was horrified when Companies House, the official repository of company financial and regulatory information, reported that it had gone bust. In fact, that was incorrect; the problems were with a totally different firm, Taylor and Son Ltd. Just a single "s" different.

The effect was devastating. Because most of their suppliers presumably had some sort of rapid notification service, the data could be and was transmitted and used instantly. Unfortunately, that meant that suppliers cut off Taylor and Sons, refusing to provide them with goods or services, which meant the firm could not service its clients. The company subsequently went into administration, and was finally dissolved in 2014.

We might wonder why, when the owners called suppliers and explained the mistake, which they did, those firms didn't accept that and resume supply? But we tend to trust data, particularly when it comes from an apparently reputable source such as Companies House. Put yourself in the suppliers' shoes. Who would you believe? The renowned government-supported organisation, or a panicking owner telling you "really, it's ok, honestly it is, we’re doing fine"!

"Computer says no" as the Little Britain show said, and you can imagine a credit control manager in just that role. Why take the risk of trusting a mere flesh and bone human as opposed to the mighty Companies House database?

Finally some good news; the court case last week found in favour of the Taylors, and (subject to appeal) they may get some £8 million ($13M) out of it. That may not fully compensate for the death of a 120-year-old business, but it is something.

And what do we learn? Just that sometimes the data we are provided with, however big, however well sourced, however apparently robust, is simply wrong.

Share on Procurious

Discuss this:

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.