This post in a nutshell: stories are powerful, but dangerous.
Powerful, because they are the best way to persuade people to do what we want them to do (journalists, lawyers and salespeople know this well). Dangerous, because we also use them to sell easy explanations to ourselves.
Fooled by ourselves
In The Black Swan, Nassim Nicholas Taleb talks about the "Narrative Fallacy"—our tendency to believe stories we've made up to explain facts. Pretty much every newspaper story about scientific research is guilty of this (see for example this post by Kaiser Fung).
The problem is that we tend to be happy with an explanation which is plausible, as long as it is consistent with the evidence (particularly if it fits with our preconceptions), whilst forgetting that there are lots of other potential explanations. By jumping to conclusions we automatically cut off any further investigation of the real explanation, so this process tends to be self-fulfilling.
A key part of the scientific method is designed to tackle exactly this. Proper testing is all about thinking up ways our story could be shown to be wrong, not piling up more evidence that it is right. Sadly the testing part of the process rarely transfers into business.
Business strategy: Facts->Hypothesis.......
So what happened to fact-based management? It has been a victim of three fatal weaknesses:
1) Proper scientific testing of causality is difficult, sometimes impossible.
2) Science is a bit nerdy, and the people who run businesses were more often the captain of the school rugby team than they were the chess club.
3) Business likes to perpetuate a myth of itself as slightly macho, seat of the pants, instinctive and passionate. This is all very well if you want an organisation staffed entirely with Apprentice contestants (shudder), but doesn't help if you want to make good decisions.
Proper science is the only way to find out what actually works. As I've said before on this blog, why not put some of your assumptions to the test?
The responsibilities of the story-teller
If we have a duty to ourselves, and to our businesses, not to be fooled by our own glib explanations and preconceptions, we should also do our best to make sure that we don't lead others down the garden path.
It may not always feel like it, but our stories can be just as compelling for other people as they are for us. We need to be very confident what we're saying is true. The cynic in me thinks that many people would be paralysed with terror if they thought there was the slightest chance that what they were saying might actually change the way anything was done...but shouldn't we at least act as if it might?
Stories are, without doubt, the best way to make people take notice of what you're saying. But before you rush off to create your next story, make sure it's grounded in evidence. You don't necessarily need to show your working, but you do need to have done it. Great writers spend most of their time researching and rewriting—shouldn't you do the same?