How to Analyze Information

A Step-by-Step Guide to Lifes Most Vital Skill

by Herbert E. Meyer
We are living now through the early decades of the Information Revolution, and its a
miracle of human energy and ingenuity. Never before has so much information been
available, so easily and inexpensively, about so many subjects.
And the most important thing weve learned is that information is like water. Its vital
to our lives; we cannot survive without it. But if too much pours over us we drown.
To keep from drowning in information we must learn to use it properly, which means
fguring out what the information is telling us. After all, it isnt the information itself
we use to make decisions; its the knowledge within the information that we use.
This is why we must learn how to analyze information how to determine just what
information we need to make the decisions we face, how to get that information, and
then this is the most crucial step of all -- how to reach inside this information to grasp
the knowledge it contains.
Of course, we all analyze information all the time, even without realizing were doing
it. For example, we see the fuel gauge in our car pointing toward empty, and we
understand its time to look for the nearest gas station. We arrive at the airport, glance
at the departure screen and see that our fight has been cancelled, and know that we
must run to the ticket counter and book another fight. We watch a weather report
on television alerting us that a blizzard is heading our way, and we dash out to buy a
shovel. Extracting the meaning of information is part of human nature; weve always
done it, and we couldnt stop doing it even if we tried.
Whats changed is the volume of decisions we all make, and their impact. In todays
world, each of us makes more decisions than our ancestors made not only in our
personal lives, but more importantly in our professional lives. Moreover, the isolation
of families, communities, and businesses that marked earlier epochs has long since
ended; today a decision made in Kansas City affects people in Miami and Mumbai,
and a decision made in London may be based, at least in part, on information that
originated in Cairo or Beijing. And these countless decisions we make -- in our personal
lives, at work, in our communities, in business, and in politics -- all combine to have a
profound effect not only on ourselves and our families but on our countries and even,
sometimes, on civilization itself.
This means that making the best possible decisions is more important than ever. And
since information is the raw material of decision making, this is why its time to learn,
step-by-step, how to analyze it.
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Step One: Figure Out Where you Are _________________________
You cannot make sense of information unless you know where you are when you
look at it.
To use a simple example, imagine that you are driving toward San Francisco,
where you plan to spend the night at a hotel. You hear a beep, glance down at
the dashboard and see a yellow light on the fuel gauge signaling that theres very
little gas left in the tank. If your hotel is at 55 Fourth Street, and you see that youre
just now passing 27 Fourth Street you can keep going to the hotel and need only
remember to buy gas tomorrow. But if youre on the highway when you hear that
beep, and the last sign you remember seeing said that San Francisco is 200
miles ahead youd better fnd a gas station.
Now, you may not know precisely whether the hotel is three blocks ahead or four
blocks or 190 miles or 170 miles. But in either case you ought to have a general
idea of how far you have yet to go, and know whether fnding a gas station is
something you need to do immediately or can leave to the next day.
Sometimes, fguring out where you are isnt a question of geography. Lets
say youre a senior in high school starting to send in applications to colleges. If
youre a straight-A student, editor of the high schools newspaper and captain
of its tennis team, it makes sense to apply for admission to the most prestigious
universities, such as Stanford and Princeton. At this point, you dont know which
of the dozen or so leading universities would be best for you or which are most
likely to admit you but you know the category of university to aim for. On the
other hand, if youve got a C-minus average, failed algebra twice and passed on
your third attempt only because your parents hired a private tutor, and have never
participated in any extra-curricular activities applying to the most prestigious and
diffcult-to-enter universities makes no sense. You should aim for admission to
one of the local colleges in your state (some of which are excellent, by the way)
and try to get a fresh start there.
In either of these cases, you still dont have the detailed information you will need
to proceed with college applications. But by fguring out where you are in this
case, academically and personally, rather than geographically you are able to
fnd your way forward.
Until you know where you are you cannot make good use of the available
information. Thats because you cannot know what specifc information youll
need next, or what the information youll be looking at when you get it will mean.
So take the time to fgure out where you are literally or metaphorically -- before
moving on to the next step.
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Step Two: Be Sure Youre Seeing Clearly ______________________
Its obvious that seeing clearly is important. But when youre dealing with information,
clearly has a special meaning that isnt so obvious.
Lets say youre attending a seminar, and a colleague who isnt able to attend has
asked you to provide her not only with a summary but also with a physical description
of the speaker. In fact, the speaker is a middle-aged, average-sized, blond-haired
man wearing a dark suit, a white shirt and a red tie. But after youve taken your
seat someone places a prism in front of you one of those long, triangular bars
of glass. Now, since a prism refracts and disperses light your view of the speaker
will be distorted. The speakers hair might appear to be green, and his tie purple.
He might look very thin and tall. You might not even be able to tell if its a man or
a woman. In short, you will get everything wrong.
When we deal with information, we sometimes see through prisms not real ones,
made of glass, but intellectual prisms, in our minds. In other words, we approach
an issue with a distorted view of it. For instance, if you believe that your best friend
is honest, while everyone else knows that your best friend is a crook, you wont
see all the evidence of his dishonesty thats obvious to everyone else at least
not until its too late. Or, if youre driving toward San Francisco and you have it
in your head that this large and vibrant city is a tiny village of just 1,500 residents
boy, are you in for a surprise. When you reach its outskirts, you will be utterly
disoriented and confused by what you see before you. If you think that India is a
poor, backward country with no technology and an uneducated population you
are seeing India through a prism, and you will be blindsided by its economic power,
its technological achievements, and its rapid emergence as one of this centurys
most important nations.
In politics, the word for these intellectual prisms is ideology. During the Cold War
years, people living in the West who thought the Soviet Unions leaders were a
decent, peace-loving group of men and women were always caught off-guard by
the Kremlins vicious and aggressive military actions. Likewise, members of the
Soviet Unions ruling Politburo -- who believed that the US was always on the verge
of economic collapse due to the so-called inherent contradictions of capitalism
-- were always astonished by the strength and resilience of the US economy.
Today, Americans who believe that all Republicans are stupid, or who believe that
all Democrats are evil, are also seeing through ideological prisms. And so they
are always being surprised or caught off-guard by sensible Republican policies or
decent Democratic initiatives; sometimes they cannot even see the obvious merits
of these policies and initiatives because they are so sure they couldnt possibly be
there.
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The key to seeing information clearly is to make certain there isnt a prism between
you and whatever you are looking at. You may not know whether the population
of San Francisco is 500,000 or one million its about 740,000 but you ought to
know its a big city. You shouldnt think your best friend is a saint if hes a crook,
and you dont need to be an expert in world economics who can reel off Indias
current economic growth rate its about 9 percent to know that the image of
India as a hopelessly backward sub-continent is long since outdated. And if youre
dealing with political issues, never let yourself be blinded by ideology.
Seeing information clearly, just as knowing where you are, means you need to
have a generally accurate idea of whatever person, place, organization, situation,
or issue that youre looking at.
Because these frst two steps of the analytic process are invisible most people
arent even aware that they need to be taken before moving on to the next, visible
steps in the process. So they skip these frst two steps and start with the third. It
isnt provable with statistics, but Im convinced that the cause of most bad decisions
lies in the failure to recognize that Steps One and Two exist and must be taken.
So, take all the time you need to fgure out where you are and to be sure you arent
seeing through a prism. Then, and only then, are you ready to move forward to the
visible steps of analyzing information.
Step Three Decide What You Need to Decide _________________
My seventh-grade history teacher in New York, Mrs. Naomi Jacobs, never let a day
go by without hammering into our heads a sentence that is so insightful it ought to
be painted onto the walls of every classroom and offce in the world: The question
is more important than the answer. She was right; it is. If you dont ask the right
question, you cannot possibly get the right answer.
Decide what it is you need to decide. If youre driving to San Francisco and the
light on your fuel gauge is fashing, you must decide whether to stop for gas or to
keep driving to your destination. Or, you must decide that the question to which
you need an answer is, To which universities ought I apply? If youre a business
executive, the question may be whether your company should open a sales offce
in New Delhi or Sao Paulo. As a voter, youll need to decide which candidate to
support in the upcoming election.
Most of the time, deciding what you need to decide isnt hard. The answer is
obvious, and it takes just a moments thought to get it right. But sometimes,
deciding what you need to decide can take some effort. For example, if youre
a high-school senior who hasnt done well academically and who doesnt have
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a clue what to do with your life after graduation, the decision you need to make
isnt To which universities ought I apply. The decision is, Should I go to college
after graduation, or should I fnd a job and think about college in a year or two?
In business, the decision may not be whether to open a new sales offce for your
company in New Delhi or Sao Paulo, but whether to try and increase sales of
your companys products by pushing harder in your domestic market or by going
overseas. Only after youve decided that going overseas would be best are you
ready to decide whether it would make more sense to open a sales offce in New
Delhi or in Sao Paulo.
In other words, sometimes you must pause for a moment to be sure youre asking
the right question. If all your friends are talking about the colleges they hope to
attend, its easy to get caught up in their enthusiasm and to start doing the same
thing yourself, instead of stopping to realize that going to college may not be right
for you. And if everyone in your offce is debating whether the market for your
companys products would be larger in India or Brazil, it can take a huge effort to
slam on the brakes by asking whether expanding overseas makes more sense
than expanding in your companys domestic market.
The question really is more important than the answer thank you, Mrs. Jacobs
-- so be sure you make an effort to get it right.
Step Four Determine What You Need to Know ________________
Lets say that youve invited friends to your home for dinner. Youve decided what
you want to cook for them meat-potatoes-vegetable, or a curry, or lasagna. Your
next step will be to make a list of the ingredients youll need to cook whatever
youre planning to serve.
What ingredients are to a meal, information is to a decision. Once youve decided
what youre going to decide, the next step is to make a list of the information youll
need to make that decision.
For instance, if youve decided to apply for admission to your countrys most
prestigious universities, make a list of these universities, then add to this list the
specifc questions to which youll need answers such as the location of each
university, the various courses they offer, the annual cost of tuition and the kinds
of scholarships each university makes available to its students. If youve decided
to open a sales offce for your company in either New Delhi or Sao Paulo, youll
want to know the potential size of the market for your companys products in India
versus Brazil, the competitors youll be facing in each market, and the costs of
renting offce space in these two cities.
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Sometimes the list of information you need is so short that writing it out would be
silly. If the warning light on your fuel gauge comes on, all you need to know is
whether this means you have two gallons of gas left in the tank or four. (So, just
pull over to the side of the road, stop, take the operators manual out of the cars
glove compartment and look in its index for the appropriate page. Youll have
the answer in ten seconds.) But sometimes the list of information youll need
is long, and writing it out really is necessary. If youre trying to decide in which
foreign country to open a new sales offce, youll want information about markets,
demographics, competitors, taxes, import-export regulations, labor laws and other
issues that are complex, and too important to risk forgetting.
Take as much time as you need to make the most complete list you can of the
ingredients the information youre going to need. Of course its always
possible that youll leave something out, just as experienced cooks sometimes
leave an item off their shopping lists. And when this happens, youll do what the
cooks do; youll run back to the store to get what youve belatedly realized you
need. Just do the best you can to make your list of necessary information and if
you do leave an item off your list well, you can get it later.
Step Five Collect Your Information __________________________
The frst thing you need to fgure out is the most reliable source for each piece of
information you need:
If you want to know what time your fight to London will arrive at Heathrow airport,
dont ask a friend who took that same fight last month; your friend could remember
incorrectly, or its possible that the schedule itself has changed. Check with the
airline itself to be sure youve got the correct arrival time. If youre trying to decide
whether to seek admission to a certain university, your best source for information
about its courses, tuition, and scholarships is the university itself, for instance from
its offcial catalog and website. But if you want to get a feel for what life on campus
would be like, the best source for this information will be students and former
students. Youll want to talk with some of them directly in person, or by telephone
or email. Likewise, if youre trying to get information about tax rates, labor laws and
import-export regulations for New Delhi and Sao Paulo, these cities governments
will be the most reliable sources. But if you want information about the costs of
renting offce space in these cities, youd be smart to check with local property
agents rather than with government offcials; the property agents are more likely to
have up-to-date numbers and they are more likely than government offcials to
tell you the truth about the offce rental markets in their cities.
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Youve already made a list of the information youre going to need. Now, next to
each item, write down the most reliable source for it a government agency, a
university or another organization such as a business or an industry association,
or specifc individuals.
Now its time to fgure out the best way to access the sources youve identifed:
Remember, accessing the information youll need to make a decision is the
equivalent of shopping for the ingredients youll need to cook a meal. As every
experienced cook knows, sometimes you can fnd all the ingredients you need
at the supermarket, so you can get your shopping done quickly and easily; other
times, you start at the supermarket and then go on to the specialty shops for those
ingredients the supermarket doesnt carry.
These days, we have information supermarkets like Google that make the chore
of information-shopping quick and easy -- and free. The range and breadth of
information available online today is simply astounding, and its a trickle compared
with the torrent of information that will be available online tomorrow and in the
years and decades that lie ahead. But just as even the largest supermarkets dont
carry every imaginable ingredient, not all information is available online. There
will always be some information youll need that you wont be able to get at the
information supermarkets or, for that matter, just by sitting at your desk.
Give yourself as much time as possible to access all the information you need.
If youre lucky, the information supermarkets will supply everything through the
websites to which they link. If youre not so lucky, youll start with the information
supermarkets and then go on to look up information in books, magazines, and by
talking with people in person, on the telephone, or by email. Sometimes you will
be able to do all this without ever leaving your chair. Other times youll need to visit
a library, meet with someone in person, or even travel to another city or country.
As a general rule, youll discover that there is always one source one website, for
instance, or one person where the correct answer to your question can be found.
Keep going until you fnd this source.
Since time is always limited, use your best judgment about how much effort to
spend for each item on your list. Keep in mind that, just as all the ingredients to
a recipe arent equally important, not all items of information for a decision are
equally important. After all, if necessary you can bake a lasagna without oregano;
but you cannot bake a lasagna without pasta. As you shop for the information
you need, try to separate out the various items into two categories: those which
are necessary, and those which are merely desirable. If youre deciding whether
to seek admission to a certain university, its necessary to know the cost of tuition;
knowing whether this university provides television sets in every dormitory is merely
desirable. If youre deciding whether to build a factory in, say, Shanghai, you must
know the local tax rates and labor laws; you may also want to know if theres a golf
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course nearby, but you really dont need to know this.
As you go about the business of accessing information, start by seeking answers
to the necessary questions. If your time permits, then go on to search for answers
to the desirable questions.
Step Six Turn the Information Into Knowledge ________________
When youve invited friends to your home for dinner, you dont put all the ingredients
youve gathered onto the table and expect your friends to imagine what you planned
to serve. Before they arrive, you cook the ingredients into whatever it is youve
decided to serve meat-potatoes-vegetable, curry, or lasagna and then put the
fnished meal on the table for your friends to enjoy.
Likewise, youve got to cook the information youve collected into a fnished
product so that you can use it to make a decision. Unlike cooking the ingredients
youve gathered into a meal which is mostly a physical process -- reaching inside
the information youve gathered to grasp the knowledge it contains is an intellectual
process. Your objective is to understand what the information means to you in light
of the specifc decision youre facing.
As you study the information youve collected, the frst thing to look for is facts.
How much fuel is left in your tank, and whats the distance from where you are to
your hotel? How much does Princeton charge for tuition, versus how much for
tuition at Stanford University? What is the corporate tax rate in India, and whats
the comparable rate in Brazil? What time does my fight land at Heathrow airport?
If the sources from which youve gotten the information are reliable the owners
manual for your car, the universities offcial websites, the governments of India
and Brazil, the airline then you may be confdent that the information youve
collected is accurate. But if you get conficting facts for example, one source
reports that tuition at Princeton is $30,000 annually, while another source reports
that Princeton charges $35,000 per year youve got to resolve the inconsistency.
The chances are that one source is right while the other is wrong. When this
happens, you must decide which of the two sources is most reliable. But its
possible that both sources are accurate, for instance if one source is including the
cost of room-and-board while the other isnt. Take the time to sort it out.
As you continue to study the information youve collected, you must also keep an
eye out for patterns.
Seeing patterns is part of what it means to be human; its how we make sense of
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the world. For example, we learn that the sun always rises in the east and sets
in the west; that men tend to be bigger and physically stronger than women; that
people who are kind tend to have more friends than people who are cruel. More
importantly, by seeing patterns we can use our experience to predict the future. And
by predicting the future, we can change the future before it happens. For example,
we learn from experience that winters are colder than summers. So rather than
freeze to death when winter comes, in late autumn we prepare by purchasing fuel
to heat our homes. We learn from experience that traffc is heavier during rush
hour than at other times of the day. So when we must drive somewhere during
rush hour, we leave our home or offce a few minutes early, to make sure that even
if we do get stuck in a traffc jam we wont be late for our appointment.
Some patterns are so obvious that we see them without even being aware of it.
For example, we cannot help but notice that cities are noisy and crowded, while
country villages are quiet and sparsely populated. But some patterns arent so
obvious, and it takes experts qualifed people whove done serious research
-- to point them out. Economists tell us that people who live in countries with free-
market economies tend to be more prosperous than people who live in countries
whose economies are controlled by their governments. Cardiologists report that
the incidence of heart disease among people who are overweight is higher than
the incidence of heart disease among people who eat sensibly and get a lot of
exercise.
As you study the information youve collected, make a conscious effort to look for
patterns. This is how you will make sense of the information. For instance, youll
see that tuition at all the prestigious private universities in the US is higher than
tuition at all the public universities. Or that labor costs in developing countries
tend to be lower than labor costs in Europe. Moreover, by consciously looking for
patterns you will be able to spot exceptions to the patterns. For instance, if youre
comparing tuition fees at prestigious American universities you will see that all of
them are expensive to attend but by consciously noticing this you may also see
that at one of these universities tuition fees are markedly lower than at the others.
If you arent wealthy, you may want more information about this high-prestige, more
affordable university. If youre trying to decide in which of six developing countries
to build a factory, you may fnd that labor costs are lower in all six countries than
in Europe -- but quite a bit higher in the sixth developing country than in the other
fve. Youll probably want to scratch Country-Number-Six off your list of potential
factory sites.
By studying the information youve collected until you have determined the facts
and seen the patterns it contains, you have turned raw material into a fnished
product. You have turned information into knowledge.
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Step Seven Add the Final Ingredient: ________________________
Before actually making your decision, there is one fnal ingredient you will add
whether you want to or not: your own judgment.
Judgment is the sum total of who we are the combined product of our character,
our personality, our instincts and our knowledge. Because judgment involves
more than knowledge, it isnt the same thing as education. You cannot learn
judgment by taking a course, or by reading a book. This is why some of the most
highly educated people in the world have terrible judgment, and why some people
who dropped out of school at the age of sixteen have superb judgment. After
all, the most visible pattern in the world is that different people respond to the
same circumstances in different ways. Some people are naturally sensible, while
others are naturally foolish. Some people enjoy taking risks, while others tend
to be cautious. Some people are congenital optimists, while others are always
pessimistic. Some people just seem to have good instincts, for instance about
other people, or about technical issues such as whether the price of crude oil will
rise or fall in the coming months. Other peoples instincts always seem to lead
them astray.
Now you can understand why two people, facing the same decision and armed with
precisely the same information, will make different choices. As you reach your
decision, you will be combining the knowledge youve gained from the information
youve collected with your own character, your own personality, and your own
instincts. You cannot help but do this, because you are a human being and not a
machine.
At least in the short term, there is little you can do to change your judgment. Its
who you are. But if you are aware of who you are and if you have worked hard
to collect information and then to turn this information into knowledge -- you will be
more likely to make the decision thats right for you. And this, of course, is what
analyzing information is all about.
Why Bother to Learn All This?
A Personal Note: __________________________________________
Not all decisions are equally important. Whether you decide to watch television this
evening or to take a walk isnt likely to change your life. Whether your family decides to
spend its next vacation on a beach in Mexico, or visiting Tokyo, wont alter the course
of world history. But some personal decisions really do matter which college to
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attend, for instance, or whom to marry, what job to take and whether to have children.
Its the same in our professional lives. Some decisions are trivial while the impact of
other decisions will be huge. Moreover, as I wrote in the opening paragraphs of this
guide, today we all make more decisions than ever before about ourselves, our jobs,
our communities and our countries -- and we make them faster. In the modern world,
the cumulative effect of all these decisions is enormous. The economic decisions
we make affect the lives of millions of people in scores of countries. The political
decisions we make can preserve the peace, or lead to war. In a world where one
companys bankruptcy can send a fnancial shockwave crashing into three continents
before days end, and where a nuclear-tipped missile can strike anywhere on earth
within an hour, we cannot afford to make too many mistakes.
Like everyone else, Ive made both personal and professional mistakes. But along
the way Ive been lucky enough to meet some of the worlds most interesting and
intelligent people. And Ive been smart enough, at least some of the time, to take
advantage of my good luck by trying to learn from these people. Perhaps the most
remarkable of all the people Ive met is Dr. Jonas Salk, who developed the polio
vaccine and, by doing so, became one of the few men in history whose work saved
countless millions of lives.
One evening Jonas and I were having dinner at a beachfront restaurant near his home
in La Jolla, California. We fell into a conversation about the debate just then starting
up between advocates of Charles Darwins theory of evolution and advocates of a
new theory called Intelligent Design. As usual, I was asking questions and Jonas, out
of kindness and infnite patience, was trying to help me understand what the debate
was all about. At one point during our conversation I asked Jonas if he subscribed to
Darwins famous theory about survival of the fttest. There was a long pause while
Jonas chewed his food and thought, and looking across the table I had the strong
feeling that this question had been on Jonas mind before Id asked it. He seemed
to be searching for just the right words, and when he fnally responded he spoke so
quietly I had to lean forward in my chair to hear him:
Survival of the fttest is correct, he said. But we need to change the defnition of
ftness from what it meant when Darwin used it. In the modern world, ftness no
longer refers to physical strength. From now on, it means wisdom.
I knew right then that I had just been privileged to hear one of historys most brilliant
men delivering one of historys greatest insights. Our world is wonderful and infnitely
fascinating. But it is also complicated, and therefore very dangerous. If we are to live
in peace, freedom and prosperity -- if the human species is to survive -- we must learn
to rely more on our minds than on our muscles. We must force ourselves to value
wisdom above strength. And this is why its worth the time and effort to master the
steps Ive outlined here. When you learn how to analyze information, you are really
learning how to think.
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Herbert E. Meyer is a leading authority on the use of information.
During the Reagan Administration, Mr. Meyer served as Special
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managed production of the U.S. National Intelligence Estimates
and other top-secret projections for the President and his national
security advisers. Mr. Meyer is widely credited with being the frst
U.S. Government offcial to forecast the Soviet Unions collapse
-- a forecast for which he later was awarded the U.S. National
Intelligence Distinguished Service Medal, which is the Intelligence
Communitys highest honor.
Formerly an associate editor of FORTUNE, he has authored several books including
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Mr. Meyers essays on Intelligence and Politics have been published in The Wall Street
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Mr. Meyer is host and producer of The Siege of Western Civilization, a DVD that
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These days, Mr. Meyer is active on the lecture circuit. He delivers his overview
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