David Brooks: What Big Data Can’t Do!

Dear Commons Community,

David Brooks has a column today cautioning about an over reliance on data-driven decision making.  In the of era big data and analytics, he is right in raising a yellow flag.   He opens with a vignette:

“Not long ago, I was at a dinner with the chief executive of a large bank. He had just had to decide whether to pull out of Italy, given the weak economy and the prospect of a future euro crisis.

The C.E.O. had his economists project out a series of downside scenarios and calculate what they would mean for his company. But, in the end, he made his decision on the basis of values.

His bank had been in Italy for decades. He didn’t want Italians to think of the company as a fair-weather friend. He didn’t want people inside the company thinking they would cut and run when times got hard. He decided to stay in Italy and ride out any potential crisis, even with the short-term costs.

He wasn’t oblivious to data in making this decision, but ultimately, he was guided by a different way of thinking. And, of course, he was right to be. Commerce depends on trust. Trust is reciprocity coated by emotion. People and companies that behave well in tough times earn affection and self-respect that is extremely valuable, even if it is hard to capture in data.

I tell this story because it hints at the strengths and limitations of data analysis. The big novelty of this historic moment is that our lives are now mediated through data-collecting computers. In this world, data can be used to make sense of mind-bogglingly complex situations. Data can help compensate for our overconfidence in our own intuitions and can help reduce the extent to which our desires distort our perceptions.”

As someone who has written about data-driven decision making in education, I understand Brooks’ position.  There are certain decisions where values, trust, and relationship-building trump the data analysis.  And in this era of big data, there are a lot of variables that are extraneous and “noise” to used Nate Silver’s term, to the decisions at hand.

Tony

 

 

 

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