The Philosophy of Business Analysis, Part II: Metaphysics

By Colin Temple July 3, 2012

In my first post of this series, I wrote about epistemology in business analysis. I questioned whether or not the data we gather from a business gives us real knowledge about the business, and concluded that while we can get quite a bit from it, a good analyst will always have doubts.

This time, I want to discuss metaphysics, the area of philosophy focused on being itself. What is it to exist, and what are the things that exist? What is the true nature of the world? These are the questions metaphysics tackles. Of all the areas of philosophy, this probably seems the least relevant to business analysis, and I’ll admit it may be the biggest stretch. However, all belief and knowledge depends on certain metaphysical assumptions, and it’s an important philosophical activity to address them.


Photo credit: Janet Ramsden

The Metaphysics of Business Analysis

First, a note on metaphysics. Many people tend to think of metaphysics as being what its name suggests in modern terms, ‘beyond physics’. That’s not the case, nothing supernatural or mystic is intended by the name, though many have supernatural metaphysical beliefs, of course. The name ‘metaphysics’ actually comes from readers of Aristotle who referred to the writing after Aristotle’s Physics as the ‘Metaphysics’. What Aristotle does in these texts is what many philosophers have called ‘first philosophy’. And the name makes sense: before we can do any other philosophy, we have to determine what we’re talking about when we discuss being, the world, objects or anything else. We need to make our assumptions perfectly clear.

So what are the objects of business analysis? A business, the data it generates and the money it makes come to mind. But these three things seem like abstractions to me. Are they real things? In the same sense that a rock is a real thing? I’m not sure that they are.

What is a Business, Really?

Legally, a corporation is an entity in itself. But is there really such a thing as a corporation? Does it have some kind of social reality or is it just something that exists in our minds? Is it reducible to facts about human brains and what they believe? Or does it reduce to a set of people, offices, desks, chairs and other items? Maybe it’s not reducible at all, and a business is something in and of itself, separate from all the ideas, people, offices, desks and chairs, which is created in the moment that someone starts a new business.

If every person employed by a business were to vanish, would the business continue to exist? Is the answer the same whether the business is a company or not? This is an ontological question, a question about what things are counted as ‘real’. Sometimes that’s an arbitrary decision, but a philosophical system must have a consistent ontology, and a common attitude is to limit one’s ontology to the least types of entities possible.

I also brought up the issue of whether an analyst is measuring a business or simply business. That may seem like a subtle difference, but it has to do with the problem of identity over time. A business is constantly changing — how much money it has, how many people it employs, who those people are, and so forth. Since this information changes from one moment to the next, it would seem that a business is never the same business that it was yesterday, unless we do posit that a business is a separate, independent, non-physical entity.

Otherwise, if a business lost all of its money and went into debt, fired every one of its employees, and then earned money again and hired new employees, we might not be able to call it the same business. What happens if all of the money and employees changed gradually over a decade – at what point does the first business cease to exist and the second come into being? (This sort of example goes back to the Plato).

It seems to me that the business analyst is not analyzing an object called a business. Rather, he or she is analyzing business as it happens — it is activity that is measured and reported on. The payment and collection of money, the movement of inventory, the clicks on a website: the analyst’s domain of inquiry is a specific set of activities in the world, activities that meet certain conditions, such as clicks on this website, movement of inventory in this warehouse or store, and so forth. For the analyst, this does away with the ontological question of whether or not a business exists; only relevant actions are the subjects of analysis.

Data and The Elusive Number


Photo credit: Luis Argerich

I ruined my boss’ day once when I went on a rant explaining why numbers don’t exist. Jim had trouble working on tactical things after that. But it’s a real metaphysical question that doesn’t have a well agreed-upon answer yet: do numbers exist? Is there such a thing as the number eight, for example? Does it exist somewhere? When I say 8 + 8 = 16, what am I talking about? Abstract concepts? If so, would numbers exist if there weren’t anyone to think about them?

These kinds of questions have troubled philosophers for centuries. Plato believed that all universals, that is, non-instantiated beings like “horse-ness”, “chair-ness”, “beauty” and so forth, existed out in some separate realm of the forms. He held that this realm, sometimes called the Platonic Heaven, was more real than this one, since we never get anything pure, just the likeness of these universal forms when they are instantiated in everyday objects.

Few modern philosophers agree with this view, but many of them do believe that mathematics is about something — namely these numerical objects which exist, on their own, in some real sense. So, I might have eight coins in my pocket, but apart from these and every other grouping of eight, there is the object ‘eight’. When we learn that 8 is twice 4, or that 8 is a Fibonacci number, we learn something about this object. This view is called mathematical platonism, after Plato.

Others, on the other hand, believe that eight only exists when you group eight things together, and that arithmetic is simply reasoning about arbitrary groupings of real objects, not about some real numerical objects themselves. This view is called mathematical nominalism. I fall into this camp, personally, but the matter is far from settled.

University of Nottingham philosopher Jonathan Tallant is featured in a nice video on this subject:

Fortunately, I will happily argue that not much hinges on this question for the analyst. The analyst manipulates numbers all day, but those numbers are measurements of things, so any metaphysical explanation for them will do, so long as mathematics is reliable. Even though the number eight may or may not exist as a thing in itself, a statement like ‘there were eight transactions in the last hour’ is still true if and only if there were in fact eight transactions in the last hour.

Money

What about the prize of business, the almighty dollar? Money has a similar ontological problem. We accept little discs of metal and little pieces of paper in exchange for goods and services that are worth far more than the actual materials we get back. Sometimes we don’t get anything physical back, but can read on a screen somewhere that our bank balance is higher than it used to be. A social convention exists which says that these symbols mean something, that they have value, and that they can be exchanged again for goods and services.

Does money exist? Of course, coins and banknotes exist, but what about the amount they’re supposed to be worth? If my bank account says that I have ten million dollars, like I wish it did, what that generally means is that I have a certain amount of purchasing power. Is that a fact — a social fact? I could get things, real things, in exchange for my imaginary things, these dollars.

What a deal.

And what happens when people stop believing in money? It’s happened before. Numerous bank runs and cases of hyperinflation have resulted from people losing confidence in a currency, resulting in a huge increase in prices of goods. So if money is such a fragile, imaginary, conventional thing, why do we base so much of society on it? Why is it the end goal for a business?

Decisions, decisions…

The problem with metaphysical questions like these is that there isn’t much agreement on the answers. Philosophers tend to be split up into various camps with names like ‘realist’, ‘physicalist’, ‘nominalist’, ‘idealist’ and so forth. Fortunately, it’s easy enough to ignore these questions when you’re in the game, but occasionally it’s fun to think about what exactly it is you’re working on, and working for, in a metaphysical sense — not just whether or not it matters but whether or not it is.

The idea here is that a business analyst works regularly with many abstract concepts and hypothetical objects. Whether it’s business, a business, numbers or dollars and cents, one can quickly feel like he or she is a long way from counting simple pebbles.

Next time, I promise to bring it back down to Earth with some ethical questions. What can we say about how an analyst ought to do his or her job? There are some very important considerations there.

Until then, cheers!

Colin

 

 

One Response to “The Philosophy of Business Analysis, Part II: Metaphysics”

  1. Robert Moores Says:

    Hi Colin

    I’ve really enjoyed parts 1 and 2 – do 3,4, and 5 exist (in any sense) ?

    I take your pint when you say that metaphysics is the least relevant domain of philosophy to business analysis. However maybe if we reverse it (kind of), business analysts can play a useful role in identifying things that aren’t really important ?

    In any case, I think you have tapped into a REALLY INTERESTING flow of ideas with the first two blogs. I happen to be a philosophy graduate who is now a BA Practice Manager, and I believe that BAs can certainly learn from philosophy.

    Congratulations on an insightful and humorous blog – I’d love to hear more !

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