Numbers carry far more information than their value or size. Numbers can be thought of as having three dimensions or aspects: 1) the numeric value (arguably, the least important to the shop owner); 2) the delta (change) it represents in the quantity being measured; and 3) the vector or direction of the difference of that change from the preceding value or target (benchmark).
In our businesses, we often see people who, upon hearing a number, instantly spring into action. Yet, there are others who pore over the reports and wonder what the other people saw that made them so excited. People see and use numbers differently, and this difference in understanding the information that numbers convey separates the folks who react instantly from those who need a lot more time to get the message.
Innumeracy is a problem that continues to get coverage in the media and in the policy debates about education. All of us employed in the precision machining industry are competent at using numbers—we use them to ensure the quality of our work and to understand our processes. So how do we explain the difference in comprehension of numeric data by different people?
The difference between a new foreman’s or supervisor’s understanding of our daily, monthly or annual reports compared to that of a more senior supervisor is not because they can’t do the math. It’s because their view is limited to the math, and they don’t see the other non-math dimensions of the number before him.
At a Cleveland Cavaliers basketball game earlier this year, I was astonished to see a sign on the scoreboard that read, “The Diff” (a trademark of the Cleveland Cavaliers). As I watched the game, that “The Diff” sign showed the difference between Cavaliers’ points and those scored by the visiting team. After getting over my shock at seeing this routine subtraction being done for an audience that should be able to do the math, it occurred to me that “The Diff” was, in fact, the single-most critical indicator for the game.
That one number told me far more than any other number. Say the Cavaliers had 44 points. So what? 44 points alone, while accurate, tells us nothing about who’s ahead, who’s behind or by how much. “The Diff,” on the other hand, lets us know instantly whether the home team is ahead or behind, close or in deep trouble.
So, in the production meeting, when “The Number” is presented for consideration, the new supervisor looks at it as a stand-alone number, taking only its value into account. The senior manager knows the change (the delta or “The Diff”) from the plan or the target, so can instantly reach an opinion about what the new number means and what needs to be done.
The understanding of what the number represents is not a math or arithmetic issue; it is about understanding both its context and its delta (change) to the status quo. The delta is the difference when understanding the real meaning behind the number.
The third dimension that the number has is its “vector” or the directionality of that change. “The Diff” may be two points in a basketball game, but if it’s the final, it is critical to know if the delta is positive (up two points—winner) or negative (down two points—loser).
When we witness someone jump out of his or her chair after a quick glance at the numbers, instead of wondering why that person had such a big reaction to “only a number,” remember that the number carries more than its value. It also implies a delta or change, as well as a direction of that change in whatever is being reported.
The understanding of the context of the number (and therefore, the context of the change) is the difference. Whether in basketball or business, the delta is the difference, and arguably the most critical indicator for your understanding.