Level 3 · Recommend: where does the showroom go?

From numbers to a recommendation

The analysis is done; now it has to help a board decide. A recommendation that holds up in a meeting has three parts, sometimes taught as what, how much, so what:

• What is the main finding? New York is the largest consumer metro; Los Angeles is the fastest growing of the leaders.
• How much supports it? The numbers Catherine can repeat: $97.0k from 104 buyers in New York, down 5.9%; $71.6k from 78 buyers in Los Angeles, up 30.7%; Dallas third with $66.4k.
• So what does it mean for the decision? A shortlist of two, with a lean and a reason for it.

Without the numbers it is a description. Without the decision it helps nobody.

Caveats belong in the paragraph

Catherine asked how sure you are. A careful analyst says it in the same paragraph, in plain words:

• Online sales are not walk-in demand. The data shows where existing customers live. It cannot show how many new people a showroom would bring in, or whether locals would visit at all.
• Big places lead because they are big. New York and Los Angeles have the most people, so they have the most customers. Revenue per person in the metro would need population data we do not hold.
• The cleaning moved the numbers. Grouping by the raw city would have shown New York at $85.2k instead of $97.0k. Saying so tells the board the figures were checked.
• A cheaper test first. A pop-up or local advertising in the two shortlisted metros measures demand before anyone signs a lease.

Caveats are not hedging. They tell the reader what the result can carry.

The traps in the other options

• The wrong level and the wrong customers. California is the top state, but its $277.4k includes business accounts and is spread over several metros, and it grew only 0.3%.
• Growth from a small base. Denver’s 123.9% is a rise from $14.2k to $31.8k. A percentage is only impressive next to the amount behind it.
• Skipping the cleaning. The raw city column splits New York into four spellings and puts its revenue $11.7k short.

The report structure behind this paragraph

In the board pack this paragraph is the executive summary: what was analysed, with which data, what was found and what is recommended. Below it come the objective (the SMART question from the first level), the data and its limits (the 69 state labels, the 14 blank cities, the 18 duplicate people), the method, the findings with the metro chart, the conclusions and the next step: the test in the shortlisted metros. Most board members read only the summary, which is why it carries the numbers and the caveats.