According to a post by Barry Ritholtz today, Donald Rumsfeld’s estimate of the Iraq war was $60 billion in 2003. So far, he’s off by about 10x that amount, and the illustration in Barry’s post shows that the war may end up costing $3 trillion when it’s all said and done.

Where is the accountability here? If this happened in the corporate world, Rumsfeld would of lost his job within minutes of realizing his estimate was so far off! This appears to be a common problem in today’s corporate society though where people make things seem better than they are in order to get approval. If Rumsfeld said the way was going to cost $750 billion, would we have gone to war? EXACTLY!

This comes back to analytics. Analytics are crucial to making the right decision. That’s the key word though, right. If you have someone biased preparing the analytics, then the decision may not be the right one.

In fact, the probability of those results being skewed to whatever that functional manager wants is pretty high. This is why having an independent group, whether in finance, business analytics or management information systems is really important to improving company performance.