Laura Dyson from Code for America: “Last year was a big year for civic technology and government innovation, and if last week’s Municipal Innovation discussion was any indication, 2014 promises to be even bigger. More than sixty civic innovators from both inside and outside of government gathered to hear three leading civic tech experts share their “Top Five” list of civic tech trends from 2013m, and predictions for what’s to come in 2014. From responsive web design to overcoming leadership change, guest speakers Luke Fretwell, Juan Pablo Velez, and Alissa Black covered both challenges and opportunities. And the audience had a few predictions of their own. Highlights included:
Mark Leech, Application Development Manager, City of Albuquerque: “Regionalization will allow smaller communities to participate and act as a force multiplier for them.”
Rebecca Williams, Policy Analyst, Sunlight Foundation: “Open data policy (law and implementation) will become more connected to traditional forms of governance, like public records and town hall meetings.”
Rick Dietz, IT Director, City of Bloomington, Ind.: “I think governments will need to collaborate directly more on open source development, particularly on enterprise scale software systems — not just civic apps.”
Kristina Ng, Office of Financial Empowerment, City and County of San Francisco: “I’m excited about the growing community of innovative government workers.”
Hillary Hartley, Presidential Innovation Fellow: “We’ll need to address sustainability and revenue opportunities. Consulting work can only go so far; we must figure out how to empower civic tech companies to actually make money.”
An informal poll of the audience showed that roughly 96 percent of the group was feeling optimistic about the coming year for civic innovation. What’s your civic tech forecast for 2014? Read on to hear what guest speakers Luke Fretwell, Juan Pablo Velez, and Alissa Black had to say, and then let us know how you’re feeling about 2014 by tweeting at @codeforamerica.”
How a New Science of Cities Is Emerging from Mobile Phone Data Analysis
MIT Technology Review: “Mobile phones have generated enormous insight into the human condition thanks largely to the study of the data they produce. Mobile phone companies record the time of each call, the caller and receiver ids, as well as the locations of the cell towers involved, among other things.
The combined data from millions of people produces some fascinating new insights in the nature of our society. Anthropologists have crunched it to reveal human reproductive strategies, a universal law of commuting and even the distribution of wealth in Africa.
Today, computer scientists have gone one step further by using mobile phone data to map the structure of cities and how people use them throughout the day. “These results point towards the possibility of a new, quantitative classification of cities using high resolution spatio-temporal data,” say Thomas Louail at the Institut de Physique Théorique in Paris and a few pals.
They say their work is part of a new science of cities that aims to objectively measure and understand the nature of large population centers.
These guys begin with a database of mobile phone calls made by people in the 31 Spanish cities that have populations larger than 200,000. The data consists of the number of unique individuals using a given cell tower (whether making a call or not) for each hour of the day over almost two months….The results reveal some fascinating patterns in city structure. For a start, every city undergoes a kind of respiration in which people converge into the center and then withdraw on a daily basis, almost like breathing. And this happens in all cities. This “suggests the existence of a single ‘urban rhythm’ common to all cities,” say Louail and co.
During the week, the number of phone users peaks at about midday and then again at about 6 p.m. During the weekend the numbers peak a little later: at 1 p.m. and 8 p.m. Interestingly, the second peak starts about an hour later in western cities, such as Sevilla and Cordoba.
The data also reveals that small cities tend to have a single center that becomes busy during the day, such as the cities of Salamanca and Vitoria.
But it also shows that the number of hotspots increases with city size; so-called polycentric cities include Spain’s largest, such as Madrid, Barcelona, and Bilboa.
That could turn out to be useful for automatically classifying cities.
There is a growing interest in the nature of cities, the way they evolve and how their residents use them. The goal of this new science is to make better use of these spaces that more than 50 percent of the planet inhabit. Louail and co show that mobile phone data clearly has an important role to play in this endeavor to better understanding these complex giants.
Ref: arxiv.org/abs/1401.4540 : From Mobile Phone Data To The Spatial Structure Of Cities”
Selected Readings on Big Data
The Living Library’s Selected Readings series seeks to build a knowledge base on innovative approaches for improving the effectiveness and legitimacy of governance. This curated and annotated collection of recommended works on the topic of big data was originally published in 2014.
Big Data refers to the wide-scale collection, aggregation, storage, analysis and use of data. Government is increasingly in control of a massive amount of raw data that, when analyzed and put to use, can lead to new insights on everything from public opinion to environmental concerns. The burgeoning literature on Big Data argues that it generates value by: creating transparency; enabling experimentation to discover needs, expose variability, and improve performance; segmenting populations to customize actions; replacing/supporting human decision making with automated algorithms; and innovating new business models, products and services. The insights drawn from data analysis can also be visualized in a manner that passes along relevant information, even to those without the tech savvy to understand the data on its own terms (see The GovLab Selected Readings on Data Visualization).
Selected Reading List (in alphabetical order)
- Australian Government Information Management Office – The Australian Public Service Big Data Strategy: Improved Understanding through Enhanced Data-analytics Capability Strategy Report – a big data strategy report for Australian Government senior executives focused on the use of analytics to gain insight from publicly-held data.
- David Bollier – The Promise and Peril of Big Data – a report describing the promise (such as improving public health through analytics) and potential peril (such as powerful actors abusing large databases of personal information) of big data.
- Danah Boyd and Kate Crawford – Six Provocations for Big Data – a paper pushing back against unchecked faith in big data as a means for solving all problems.
- The Economist Intelligence Unit – Big Data and the Democratisation of Decisions – a report arguing that in both private and public contexts, greater access to big data can improve decision-making.
- James Manyika, Michael Chui, Brad Brown, Jacques Bughin, Richard Dobbs, Charles Roxburgh, and Angela Hung Byers – Big Data: The Next Frontier for Innovation, Competition, and Productivity – a report predicting the unprecedented impact of big data across practically all sectors and industries.
- The Partnership for Public Service and the IBM Center for The Business of Government – https://bit.ly/2EbBTMg – a collection of strategies for government actors to improve their decision-makers through data analysis.
- TechAmerica Foundation’s Federal Big Data Commission – Demystifying Big Data: A Practical Guide to Transforming the Business of Government – a big data framework for government actors focused on defining, assessing, planning, executing and reviewing.
- World Economic Forum – Big Data, Big Impact: New Possibilities for International
Development – a report arguing that for big data to reach its greatest potential impact, government must take a leading role in increasing open access to useful data.
Annotated Selected Reading List (in alphabetical order)
Australian Government Information Management Office. The Australian Public Service Big Data Strategy: Improved Understanding through Enhanced Data-analytics Capability Strategy Report. August 2013. http://bit.ly/17hs2xY.
- This Big Data Strategy produced for Australian Government senior executives with responsibility for delivering services and developing policy is aimed at ingraining in government officials that the key to increasing the value of big data held by government is the effective use of analytics. Essentially, “the value of big data lies in [our] ability to extract insights and make better decisions.”
- This positions big data as a national asset that can be used to “streamline service delivery, create opportunities for innovation, identify new service and policy approaches as well as supporting the effective delivery of existing programs across a broad range of government operations.”
Bollier, David. The Promise and Peril of Big Data. The Aspen Institute, Communications and Society Program, 2010. http://bit.ly/1a3hBIA.
- This report captures insights from the 2009 Roundtable exploring uses of Big Data within a number of important consumer behavior and policy implication contexts.
- The report concludes that, “Big Data presents many exciting opportunities to improve modern society. There are incalculable opportunities to make scientific research more productive, and to accelerate discovery and innovation. People can use new tools to help improve their health and well-being, and medical care can be made more efficient and effective. Government, too, has a great stake in using large databases to improve the delivery of government services and to monitor for threats to national security.
- However, “Big Data also presents many formidable challenges to government and citizens precisely because data technologies are becoming so pervasive, intrusive and difficult to understand. How shall society protect itself against those who would misuse or abuse large databases? What new regulatory systems, private-law innovations or social practices will be capable of controlling anti-social behaviors–and how should we even define what is socially and legally acceptable when the practices enabled by Big Data are so novel and often arcane?”
Boyd, Danah and Kate Crawford. “Six Provocations for Big Data.” A Decade in Internet Time: Symposium on the Dynamics of the Internet and Society. September 2011. http://bit.ly/1jJstmz.
- In this paper, Boyd and Crawford raise challenges to unchecked assumptions and biases regarding big data. The paper makes a number of assertions about the “computational culture” of big data and pushes back against those who consider big data to be a panacea.
- The authors’ provocations for big data are:
- Automating Research Changes the Definition of Knowledge
- Claims to Objectivity and Accuracy are Misleading
- Big Data is not always Better Data
- Not all Data is Equivalent
- Just Because it is accessible doesn’t make it ethical
- Limited Access to Big Data creates New Digital Divide
The Economist Intelligence Unit. Big Data and the Democratisation of Decisions. October 2012. http://bit.ly/17MpH8L.
- This report from the Economist Intelligence Unit focuses on the positive impact of big data adoption in the private sector, but its insights can also be applied to the use of big data in governance.
- The report argues that innovation can be spurred by democratizing access to data, allowing a diversity of stakeholders to “tap data, draw lessons and make business decisions,” which in turn helps companies and institutions respond to new trends and intelligence at varying levels of decision-making power.
Manyika, James, Michael Chui, Brad Brown, Jacques Bughin, Richard Dobbs, Charles Roxburgh, and Angela Hung Byers. Big Data: The Next Frontier for Innovation, Competition, and Productivity. McKinsey & Company. May 2011. http://bit.ly/18Q5CSl.
- This report argues that big data “will become a key basis of competition, underpinning new waves of productivity growth, innovation, and consumer surplus, and that “leaders in every sector will have to grapple with the implications of big data.”
- The report offers five broad ways in which using big data can create value:
- First, big data can unlock significant value by making information transparent and usable at much higher frequency.
- Second, as organizations create and store more transactional data in digital form, they can collect more accurate and detailed performance information on everything from product inventories to sick days, and therefore expose variability and boost performance.
- Third, big data allows ever-narrower segmentation of customers and therefore much more precisely tailored products or services.
- Fourth, big sophisticated analytics can substantially improve decision-making.
- Finally, big data can be used to improve the development of the next generation of products and services.
The Partnership for Public Service and the IBM Center for The Business of Government. “From Data to Decisions II: Building an Analytics Culture.” October 17, 2012. https://bit.ly/2EbBTMg.
- This report discusses strategies for better leveraging data analysis to aid decision-making. The authors argue that, “Organizations that are successful at launching or expanding analytics program…systematically examine their processes and activities to ensure that everything they do clearly connects to what they set out to achieve, and they use that examination to pinpoint weaknesses or areas for improvement.”
- While the report features many strategies for government decisions-makers, the central recommendation is that, “leaders incorporate analytics as a way of doing business, making data-driven decisions transparent and a fundamental approach to day-to-day management. When an analytics culture is built openly, and the lessons are applied routinely and shared widely, an agency can embed valuable management practices in its DNA, to the mutual benet of the agency and the public it serves.”
TechAmerica Foundation’s Federal Big Data Commission. “Demystifying Big Data: A Practical Guide to Transforming the Business of Government.” 2013. http://bit.ly/1aalUrs.
- This report presents key big data imperatives that government agencies must address, the challenges and the opportunities posed by the growing volume of data and the value Big Data can provide. The discussion touches on the value of big data to businesses and organizational mission, presents case study examples of big data applications, technical underpinnings and public policy applications.
- The authors argue that new digital information, “effectively captured, managed and analyzed, has the power to change every industry including cyber security, healthcare, transportation, education, and the sciences.” To ensure that this opportunity is realized, the report proposes a detailed big data strategy framework with the following steps: define, assess, plan, execute and review.
World Economic Forum. “Big Data, Big Impact: New Possibilities for International Development.” 2012. http://bit.ly/17hrTKW.
- This report examines the potential for channeling the “flood of data created every day by the interactions of billions of people using computers, GPS devices, cell phones, and medical devices” into “actionable information that can be used to identify needs, provide services, and predict and prevent crises for the benefit of low-income populations”
- The report argues that, “To realise the mutual benefits of creating an environment for sharing mobile-generated data, all ecosystem actors must commit to active and open participation. Governments can take the lead in setting policy and legal frameworks that protect individuals and require contractors to make their data public. Development organisations can continue supporting governments and demonstrating both the public good and the business value that data philanthropy can deliver. And the private sector can move faster to create mechanisms for the sharing data that can benefit the public.”
How Government Can Make Open Data Work
Joel Gurin in Information Week: “At the GovLab at New York University, where I am senior adviser, we’re taking a different approach than McKinsey’s to understand the evolving value of government open data: We’re studying open data companies from the ground up. I’m now leading the GovLab’s Open Data 500 project, funded by the John S. and James L. Knight Foundation, to identify and examine 500 American companies that use government open data as a key business resource.
Our preliminary results show that government open data is fueling companies both large and small, across the country, and in many sectors of the economy, including health, finance, education, energy, and more. But it’s not always easy to use this resource. Companies that use government open data tell us it is often incomplete, inaccurate, or trapped in hard-to-use systems and formats.
It will take a thorough and extended effort to make government data truly useful. Based on what we are hearing and the research I did for my book, here are some of the most important steps the federal government can take, starting now, to make it easier for companies to add economic value to the government’s data.
1. Improve data quality
The Open Data Policy not only directs federal agencies to release more open data; it also requires them to release information about data quality. Agencies will have to begin improving the quality of their data simply to avoid public embarrassment. We can hope and expect that they will do some data cleanup themselves, demand better data from the businesses they regulate, or use creative solutions like turning to crowdsourcing for help, as USAID did to improve geospatial data on its grantees.
2. Keep improving open data resources
The government has steadily made Data.gov, the central repository of federal open data, more accessible and useful, including a significant relaunch last week. To the agency’s credit, the GSA, which administers Data.gov, plans to keep working to make this key website still better. As part of implementing the Open Data Policy, the administration has also set up Project Open Data on GitHub, the world’s largest community for open-source software. These resources will be helpful for anyone working with open data either inside or outside of government. They need to be maintained and continually improved.
3. Pass DATA
The Digital Accountability and Transparency Act would bring transparency to federal government spending at an unprecedented level of detail. The Act has strong bipartisan support. It passed the House with only one dissenting vote and was unanimously approved by a Senate committee, but still needs full Senate approval and the President’s signature to become law. DATA is also supported by technology companies who see it as a source of new open data they can use in their businesses. Congress should move forward and pass DATA as the logical next step in the work that the Obama administration’s Open Data Policy has begun.
4. Reform the Freedom of Information Act
Since it was passed in 1966, the federal Freedom of Information Act has gone through two major revisions, both of which strengthened citizens’ ability to access many kinds of government data. It’s time for another step forward. Current legislative proposals would establish a centralized web portal for all federal FOIA requests, strengthen the FOIA ombudsman’s office, and require agencies to post more high-interest information online before they receive formal requests for it. These changes could make more information from FOIA requests available as open data.
5. Engage stakeholders in a genuine way
Up to now, the government’s release of open data has largely been a one-way affair: Agencies publish datasets that they hope will be useful without consulting the organizations and companies that want to use it. Other countries, including the UK, France, and Mexico, are building in feedback loops from data users to government data providers, and the US should, too. The Open Data Policy calls for agencies to establish points of contact for public feedback. At the GovLab, we hope that the Open Data 500 will help move that process forward. Our research will provide a basis for new, productive dialogue between government agencies and the businesses that rely on them.
6. Keep using federal challenges to encourage innovation
The federal Challenge.gov website applies the best principles of crowdsourcing and collective intelligence. Agencies should use this approach extensively, and should pose challenges using the government’s open data resources to solve business, social, or scientific problems. Other approaches to citizen engagement, including federally sponsored hackathons and the White House Champions of Change program, can play a similar role.
Through the Open Data Policy and other initiatives, the Obama administration has set the right goals. Now it’s time to implement and move toward what US CTO Todd Park calls “data liberation.” Thousands of companies, organizations, and individuals will benefit.”
Needed: A New Generation of Game Changers to Solve Public Problems
Beth Noveck: “In order to change the way we govern, it is important to train and nurture a new generation of problem solvers who possess the multidisciplinary skills to become effective agents of change. That’s why we at the GovLab have launched The GovLab Academy with the support of the Knight Foundation.
In an effort to help people in their own communities become more effective at developing and implementing creative solutions to compelling challenges, The Gov Lab Academy is offering two new training programs:
1) An online platform with an unbundled and evolving set of topics, modules and instructors on innovations in governance, including themes such as big and open data and crowdsourcing and forthcoming topics on behavioral economics, prizes and challenges, open contracting and performance management for governance;
2) Gov 3.0: A curated and sequenced, 14-week mentoring and training program.
While the online-platform is always freely available, Gov 3.0 begins on January 29, 2014 and we invite you to to participate. Please forward this email to your networks and help us spread the word about the opportunity to participate.
Please consider applying (individuals or teams may apply), if you are:
-
an expert in communications, public policy, law, computer science, engineering, business or design who wants to expand your ability to bring about social change;
-
a public servant who wants to bring innovation to your job;
-
someone with an important idea for positive change but who lacks key skills or resources to realize the vision;
-
interested in joining a network of like-minded, purpose-driven individuals across the country; or
-
someone who is passionate about using technology to solve public problems.
The program includes live instruction and conversation every Wednesday from 5:00– 6:30 PM EST for 14 weeks starting Jan 29, 2014. You will be able to participate remotely via Google Hangout.
Gov 3.0 will allow you to apply evolving technology to the design and implementation of effective solutions to public interest challenges. It will give you an overview of the most current approaches to smarter governance and help you improve your skills in collaboration, communication, and developing and presenting innovative ideas.
Over 14 weeks, you will develop a project and a plan for its implementation, including a long and short description, a presentation deck, a persuasive video and a project blog. Last term’s projects covered such diverse issues as post-Fukushima food safety, science literacy for high schoolers and prison reform for the elderly. In every case, the goal was to identify realistic strategies for making a difference quickly. You can read the entire Gov 3.0 syllabus here.
The program will include national experts and instructors in technology and governance both as guests and as mentors to help you design your project. Last term’s mentors included current and former officials from the White House and various state, local and international governments, academics from a variety of fields, and prominent philanthropists.
People who complete the program will have the opportunity to apply for a special fellowship to pursue their projects further.
Previously taught only on campus, we are offering Gov 3.0 in beta as an online program. This is not a MOOC. It is a mentoring-intensive coaching experience. To maximize the quality of the experience, enrollment is limited.
Please submit your application by January 22, 2014. Accepted applicants (individuals and teams) will be notified on January 24, 2014. We hope to expand the program in the future so please use the same form to let us know if you would like to be kept informed about future opportunities.”
Toward the Next Phase of Open Government
The report of the 2013 Aspen Institute Forum on Communications and Society (FOCAS) is a series of six chapters that examine the current barriers to open government and provides creative solutions for advancing open government efforts.
Chapters:
1. Open Government and Its Constraints
2. What is Open Government and is it Working?
3. The Biases in Open Government that Blind Us
4. Open Government Needs to Understand Citizens
5. Open Government Needs Empathy for Government
6. Toward An Accountable Open Government Culture
ShouldWe
ShouldWe is a new online guide to the causes and consequences of the policies which affect our lives. We will be live soon.
Safety Datapalooza Shows Power of Data.gov Communities
Lisa Nelson at DigitalGov: “The White House Office of Public Engagement held the first Safety Datapalooza illustrating the power of Data.gov communities. Federal Chief Technology Officer Todd Park and Deputy Secretary of Transportation John Porcari hosted the event, which touted the data available on Safety.Data.gov and the community of innovators using it to make effective tools for consumers.
The event showcased many of the tools that have been produced as a result of opening this safety data including:
- PulsePoint, from the San Ramon Fire Protection District, a lifesaving mobile app that allows CPR-trained volunteers to be notified if someone nearby is in need of emergency assistance;
- Commute and crime maps, from Trulia, allow home buyers to choose their new residence based on two important everyday factors; and
- Hurricane App, from the American Red Cross, to monitor storm conditions, prepare your family and home, find help, and let others know you’re safe even if the power is out;
Safety data is far from alone in generating innovative ideas and gathering a community of developers and entrepreneurs, Data.gov currently has 16 different topically diverse communities on land and sea — the Cities and Oceans communities being two such examples. Data.gov’s communities are a virtual meeting spot for interested parties across government, academia and industry to come together and put the data to use. Data.gov enables a whole set of tools to make these communities come to life: apps, blogs, challenges, forums, ranking, rating and wikis.
For a summary of the Safety Datapalooza visit Transportation’s “Fast Lane” blog.”
The Failure and the Promise of Public Participation
Dr. Mark Funkhouser in Governing: “In a recent study entitled Making Public Participation Legal, Matt Leighninger cites a Knight Foundation report that found that attending a public meeting was more likely to reduce a person’s sense of efficacy and attachment to the community than to increase it. That sad fact is no surprise to the government officials who have to run — and endure — public meetings.
Every public official who has served for any length of time has horror stories about these forums. The usual suspects show up — the self-appointed activists (who sometimes seem to be just a little nuts) and the lobbyists. Regular folks have made the calculation that only in extreme circumstance, when they are really scared or angry, is attending a public hearing worth their time. And who can blame them when it seems clear that the game is rigged, the decisions already have been made, and they’ll probably have to sit through hours of blather before they get their three minutes at the microphone?
So much transparency and yet so little trust. Despite the fact that governments are pumping out more and more information to citizens, trust in government has edged lower and lower, pushed in part no doubt by the lingering economic hardships and government cutbacks resulting from the recession. Most public officials I talk to now take it as an article of faith that the public generally disrespects them and the governments they work for.
Clearly the relationship between citizens and their governments needs to be reframed. Fortunately, over the last couple of decades lots of techniques have been developed by advocates of deliberative democracy and citizen participation that provide both more meaningful engagement and better community outcomes. There are decision-making forums, “visioning” forums and facilitated group meetings, most of which feature some combination of large-group, small-group and online interactions.
But here’s the rub: Our legal framework doesn’t support these new methods of public participation. This fact is made clear in Making Public Participation Legal, which was compiled by a working group that included people from the National Civic League, the American Bar Association, the International City/County Management Association and a number of leading practitioners of public participation.
The requirements for public meetings in local governments are generally built into state statutes such as sunshine or open-meetings laws or other laws governing administrative procedures. These laws may require public hearings in certain circumstances and mandate that advance notice, along with an agenda, be posted for any meeting of an “official body” — from the state legislature to a subcommittee of the city council or an advisory board of some kind. And a “meeting” is one in which a quorum attends. So if three of a city council’s nine members sit on the finance committee and two of the committee members happen to show up at a public meeting, they may risk having violated the open-meetings law…”
Why the Nate Silvers of the World Don’t Know Everything
Felix Salmon in Wired: “This shift in US intelligence mirrors a definite pattern of the past 30 years, one that we can see across fields and institutions. It’s the rise of the quants—that is, the ascent to power of people whose native tongue is numbers and algorithms and systems rather than personal relationships or human intuition. Michael Lewis’ Moneyball vividly recounts how the quants took over baseball, as statistical analysis trumped traditional scouting and propelled the underfunded Oakland A’s to a division-winning 2002 season. More recently we’ve seen the rise of the quants in politics. Commentators who “trusted their gut” about Mitt Romney’s chances had their gut kicked by Nate Silver, the stats whiz who called the election days beforehand as a lock for Obama, down to the very last electoral vote in the very last state.
The reason the quants win is that they’re almost always right—at least at first. They find numerical patterns or invent ingenious algorithms that increase profits or solve problems in ways that no amount of subjective experience can match. But what happens after the quants win is not always the data-driven paradise that they and their boosters expected. The more a field is run by a system, the more that system creates incentives for everyone (employees, customers, competitors) to change their behavior in perverse ways—providing more of whatever the system is designed to measure and produce, whether that actually creates any value or not. It’s a problem that can’t be solved until the quants learn a little bit from the old-fashioned ways of thinking they’ve displaced.
No matter the discipline or industry, the rise of the quants tends to happen in four stages. Stage one is what you might call pre-disruption, and it’s generally best visible in hindsight. Think about quaint dating agencies in the days before the arrival of Match .com and all the other algorithm-powered online replacements. Or think about retail in the era before floor-space management analytics helped quantify exactly which goods ought to go where. For a live example, consider Hollywood, which, for all the money it spends on market research, is still run by a small group of lavishly compensated studio executives, all of whom are well aware that the first rule of Hollywood, as memorably summed up by screenwriter William Goldman, is “Nobody knows anything.” On its face, Hollywood is ripe for quantification—there’s a huge amount of data to be mined, considering that every movie and TV show can be classified along hundreds of different axes, from stars to genre to running time, and they can all be correlated to box office receipts and other measures of profitability.
Next comes stage two, disruption. In most industries, the rise of the quants is a recent phenomenon, but in the world of finance it began back in the 1980s. The unmistakable sign of this change was hard to miss: the point at which you started getting targeted and personalized offers for credit cards and other financial services based not on the relationship you had with your local bank manager but on what the bank’s algorithms deduced about your finances and creditworthiness. Pretty soon, when you went into a branch to inquire about a loan, all they could do was punch numbers into a computer and then give you the computer’s answer.
For a present-day example of disruption, think about politics. In the 2012 election, Obama’s old-fashioned campaign operatives didn’t disappear. But they gave money and freedom to a core group of technologists in Chicago—including Harper Reed, former CTO of the Chicago-based online retailer Threadless—and allowed them to make huge decisions about fund-raising and voter targeting. Whereas earlier campaigns had tried to target segments of the population defined by geography or demographic profile, Obama’s team made the campaign granular right down to the individual level. So if a mom in Cedar Rapids was on the fence about who to vote for, or whether to vote at all, then instead of buying yet another TV ad, the Obama campaign would message one of her Facebook friends and try the much more effective personal approach…
After disruption, though, there comes at least some version of stage three: overshoot. The most common problem is that all these new systems—metrics, algorithms, automated decisionmaking processes—result in humans gaming the system in rational but often unpredictable ways. Sociologist Donald T. Campbell noted this dynamic back in the ’70s, when he articulated what’s come to be known as Campbell’s law: “The more any quantitative social indicator is used for social decision-making,” he wrote, “the more subject it will be to corruption pressures and the more apt it will be to distort and corrupt the social processes it is intended to monitor.”…
Policing is a good example, as explained by Harvard sociologist Peter Moskos in his book Cop in the Hood: My Year Policing Baltimore’s Eastern District. Most cops have a pretty good idea of what they should be doing, if their goal is public safety: reducing crime, locking up kingpins, confiscating drugs. It involves foot patrols, deep investigations, and building good relations with the community. But under statistically driven regimes, individual officers have almost no incentive to actually do that stuff. Instead, they’re all too often judged on results—specifically, arrests. (Not even convictions, just arrests: If a suspect throws away his drugs while fleeing police, the police will chase and arrest him just to get the arrest, even when they know there’s no chance of a conviction.)…
It’s increasingly clear that for smart organizations, living by numbers alone simply won’t work. That’s why they arrive at stage four: synthesis—the practice of marrying quantitative insights with old-fashioned subjective experience. Nate Silver himself has written thoughtfully about examples of this in his book, The Signal and the Noise. He cites baseball, which in the post-Moneyball era adopted a “fusion approach” that leans on both statistics and scouting. Silver credits it with delivering the Boston Red Sox’s first World Series title in 86 years. Or consider weather forecasting: The National Weather Service employs meteorologists who, understanding the dynamics of weather systems, can improve forecasts by as much as 25 percent compared with computers alone. A similar synthesis holds in economic forecasting: Adding human judgment to statistical methods makes results roughly 15 percent more accurate. And it’s even true in chess: While the best computers can now easily beat the best humans, they can in turn be beaten by humans aided by computers….
That’s what a good synthesis of big data and human intuition tends to look like. As long as the humans are in control, and understand what it is they’re controlling, we’re fine. It’s when they become slaves to the numbers that trouble breaks out. So let’s celebrate the value of disruption by data—but let’s not forget that data isn’t everything.