• Why Two Data Points Don't Show Trends: Understanding the Importance of Comprehensive Data Analysis in Workplaces and News

  • Jul 12 2024
  • Duración: 7 m
  • Podcast

Why Two Data Points Don't Show Trends: Understanding the Importance of Comprehensive Data Analysis in Workplaces and News

  • Resumen

  • The full blog post

    Two data points are not a trend. Two-data-point comparisons can be mathematically correct but practically meaningless.

    This is true in workplaces and news articles like this one.

    Multiple two-data-point comparisons (comparing last month to the previous month AND comparing it to the year before) don't paint the full picture the way a simple run chart would.

    If a hospital's margin is "23% higher" than the year before, is that a difference between 1% and 1.23% or the difference between 10% and 12.3%?

    Give me more data points. Better yet, create a chart that shows trends (or the lack thereof) over time. Otherwise, we're just celebrating (or bemoaning) every little up and now.

    23% sounds like a big change. But that doesn't mean it's statistically meaningful. Was it down 27% the previous month? Possibly. Some metrics simply fluctuate around a stable average.

    On NPR recently, the hourly news update covered economic indicators, including the truth and data points that say:

    • Gas prices are UP 5 cents from a week ago
    • Gas prices are DOWN 10 cents from a month ago

    So, gas prices are both going UP and DOWN. It depends on which data point you use as a starting comparison -- and what point you might be trying to prove. What are those two facts "indicators" of?? What's the longer term trend??

    --- Support this podcast: https://podcasters.spotify.com/pod/show/lean-blog-audio/support
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