Here’s One Jargony Business Consultant Word We Actually Like
It’s the word “material” as in these examples:
“The goal of this research was to identify and understand material differences in consumer preferences and behaviors.”
“Men chose the blue design by 3 percentage points more than women did, but this does not constitute a material difference.”
“The gap between the two groups is not material.”
At first I was put off by the word as being yet another example of consultants trying to impress with fancy sounding language. But I came to appreciate it. Why? Because the word helps in our ongoing struggle to teach clients that statistical significance does not mean that something is important.
“Statistical significance” is a term we use in quantitative research and data analysis. It refers to the probability that an observed difference or relationship between variables in a study is not due to chance from imperfect sampling. Statistical significance is determined through statistical tests, such as t-tests or chi-square tests, which calculate the probability (p-value) of obtaining the observed results under the assumption of no true difference or relationship.
Statistical tests are useful to us (the quantitative researchers) because so much of what we measure is subject to randomness and error. Statistical significance points us to patterns that are probably not random. But here’s the crucial point: Just because a pattern is not random (i.e. just because it is statistically significant) does not mean it is important.
That’s where the word “material” comes in. In the context of consulting, the term “material difference” typically implies that the difference is relevant, noteworthy, and has the potential to influence the evaluation or judgment of a particular matter. The determination of what constitutes a material difference is subjective and context-dependent, involving professional judgment and an assessment of the potential impact that the difference may have.
As such, consultants use the term “material difference” to highlight important variations or divergences between different scenarios, options, or outcomes. So what if men prefer the blue design 3% more than women do? So what if it’s a statistically significant difference? Unless that difference will affect how many items are sold, then the difference is immaterial.
In short, statistical significance focuses on the probability of observing a difference, and material difference assesses the practical importance or impact of that difference. Being attuned to this difference is essential to using research effectively.
Thank you, consultants, for providing a useful bit of jargon!
—Joe Hopper, Ph.D.