MGI argues that the data deluge could create a new wave of productivity growth. Properly used, big data could save the American health-care system $300 billion a year and the European public sector €250 billion. It could also enable retailers to increase their operating margins by 60%. But it is hard to read these figures without succumbing to Borges-style doubts. Will big companies and big governments use big data to trample on the little man? And is this mountain of data really as useful as MGI’s data-heads think?
The McKinseyites provide good answers to the first question. The data revolution is clearly handing power to the little people as well as the big ones. You can now buy a device that will store all the world’s recorded music for just $600. Shoppers can use their mobile phones to scan bar codes to see if there is a better deal elsewhere. Citizens can use publicly available information to demand better public services. Britain’s Open Knowledge Foundation has used government databases to develop a useful site called wheredoesmymoneygo.org. Dr Foster Intelligence provides patients with information about the quality of health care.
But on the second question, they are silent. Big data has the same problems as small data, but bigger. Data-heads frequently allow the beauty of their mathematical models to obscure the unreliability of the numbers they feed into them. (Garbage in, garbage out.)
It’s good that the popular press are beginning to present some of the issues of big data and data mining. Big data and data mining aren’t going anywhere and the more and the earlier the public is informed the better.