Part 2 of 3 in The True Nature of Business Insights Series
In Part 1, I explored how the misuse of the term “insight” has created a crisis across many organizations. Answers masquerading as insights with true understanding remaining elusive.
Now, let’s dive deeper into what really is an insight and why they matter.
From Answer to Insight: A Human Transformation
We will start by looking at an example of an answer and an insight:
Answer: “Customer support response times increased by 25% this quarter.”
Insight: “Our focus on response time metrics is actually hurting customer satisfaction. When we dug deeper, we discovered customers prefer more thorough responses that fully resolve their issues the first time, even if it takes longer to complete. “
Notice the difference? The answer tells you only part of what happened. The insight brings a much clearer understanding of the overall situation.
The Three Elements of True Insights
Drawing from psychologist Gary Klein’s research, we can define a true insight as “an unexpected shift in understanding that leads to a better story.”
Let’s take a closer using the previous example:
1. The Unexpected Shift
True insights catch us by surprise, forcing us to pause and reconsider our understanding.
Example: “customer satisfaction dropped right as we improved our response times.”
Hum, that was unexpected. Why did satisfaction drop right as we improved our response times?
2. Understanding Transformation
Insights fundamentally change how we think about a situation, not just what we know about it.
Previous Understanding: “Customers wants faster responses”
New Understanding: “Customers actually wants their issues resolved the first time.”
Our previous understanding of speed as the important metric is no longer true. We found other answers showing customers place greater value on getting their issue resolved the first time, even if it takes longer to work out.
3. The Better Story
True insights reflect a more accurate and useful understanding of reality.
Example: Resolving customer issues right the first time will likely lead to a greater long-term impact on customer trust than trying to focus on responding quickly to complex customer issues.
While responding quickly is important, the customer places greater value on getting their issue fully addressed in the first place. Answering quickly with a wrong answer is more harmful to customer goodwill.
Now you see answers are not the same as insights. Answers are the raw ingredients for our brains to process and derive into insights. Getting an answer is the first step, but many more steps are required to reach insight.
Here are some hypothetical business answers to insight examples:
The Netflix Binge-Watching Opportunity Insight
An Answer: 73% of TV streamers have positive feelings towards binge watching 2–3 episodes in a single sitting.
Insight: Binge-watching is all about viewer control. When viewers control their consumption pace, they form stronger emotional connections with shows and ultimately remain a subscriber longer.
Business Impact: This insight could likely impact Netflix’s content strategy influencing:
- Making binge ready full-season releases
- Optimized storylines to feed binge-watching
- Auto-play features like “Play Next Episode”
Airbnb’s Photography Revelation
An Answer: Listings with professional photos get 24% more bookings.
Insight: In the sharing economy, trust is the actual product. Professional photos don’t just show off the space better — they signal the host commitment and dependability, addressing customers’ deeper anxiety about staying in some stranger’s home.
Business Impact: This insight might lead to changes in Airbnb’s host offerings:
- Provide free professional photography
- Redesign the guest experience around trust signals
- Create new host education programs
Insights Evolve from Answers
True insights transform not just what we know, but how we see, think and feel. They emerge from a deeper understanding of the situation supported by data. While answers tell us what happened, insights reflect our commitment to rethink what matters.
As you’ve seen through these examples, genuine insights challenge our fundamental assumptions about our business, customers, and markets. They can reveal both hidden opportunities and invisible blockers that answers alone cannot deliver.
In my final article of this series, I’ll introduce my StoryFinding Framework — a pragmatic approach to uncovering these transformative insights. I’ll share a practical methodology to help you move beyond just analyzing data and hoping for insight.