Author

By Julian King, Andrew Paddon & Nigel Lake

Title

Quant or Bust: An Obituary for 20th Century Decision Making

Synopsis

Corporate decision making is filled with allusions to eyesight: “it is good to be visionary”, “you’d better keep your eye on the ball”, “don’t be blindsided” and “watch out for tunnel vision”. When we talk about what a company sees, that is unquestionably data. Yet, when it comes to the incorporation of data into strategic decision making and capital planning, it is typically a case of the blind leading the blind. Even when data is incorporated into strategic decisions, there remains an overwhelming preference for outdated tools, which do not respond to the realities of modern data analysis and the insights that this brings. Discounted cash flow models date from the same era as Polaroid cameras and liquid paper – and unthinking reliance on them has severe and often very expensive implications for investors, employees and all other stakeholders.