Limits Of Big Data- Philippe Delquié is Associate Professor at George Washington University School of Business. He’s also a regular speaker at the Berlin School of Creative Leadership, taking our EMBA participants on a journey through the complex and often uncertain world of Decision Making. We spoke to him about the importance of viewing ambiguity with an open mind, the creative capacity for leaders to use data to feed new solutions and ideas, and the responsibilities this ‘big data’ access brings to consumers and big businesses.
Hough: Can you give us some classroom insight into the world of ‘Decision Making’?
Delquié: It’s about individual decision making, how to handle the complexity of business decisions, and how to handle uncertainty and ambiguity. What makes decisions very difficult and potentially paralyzing for people is the presence of uncertainty in the outcomes of their decisions. This is particularly true in the business world where most investments are very uncertain. Essentially, we look at decision making not just from a numbers point of view, but from a cognitive and psychological point of view. We look at the biases that we bring to decision making, the evaluations we make, and the way we tend to adopt a very narrow view when approaching decisions. We investigate how we can increase and expand the framework in which we view our options to make sure we’re solving the correct problem, and we examine how good we really are at appraising uncertainty – we all cognitive limitations that we can overcome with proper awareness and training.
Hough: Over the last decades, factors such as digitization and globalization have changed the way business leaders and entrepreneurs look at their futures. What disruptions and trends have impacted the way that leaders manage risk now versus 10 years ago?
Delquié: One of the big things that’s happening (and that’s not going to stop) is what we call ‘big data’. We see that it’s not only disrupting things but also enabling business opportunities that were not possible before. Artificial intelligence and big data are poised to affect our ability to make timely decisions and to put other decisions on auto-pilot which frees up the human brain for other exercises and interpretation. In the future, there’s only going to be more data and processing capabilities. A.I. can do a lot of things for us, but the key thing to remember is that human judgement will always be needed and won’t be irradiated. The boundaries will be pushed but human nature will always be part of things. And that’s why we need to be evermore well-trained and vigilant about how we use our limited attention and our judgement skills. Our critical evaluation will become even more important. Another thing we hear a lot about is the advent of Blockchain technology, which will essentially change the way that banking and a lot of administration is done. With computational and distributional power, there’ll be less need to trust a single organization like a government or a bank to do things. Systems will become more secure because it doesn’t rely on the simple idea of a vault that people might try to break into. Hacking a system with Blockchain will become so much more costly than the benefits you can get from it, that it will be inherently more stable and sustainable. But we are still just at the beginning of that and people are still arguing whether the current technology which is very costly in terms of data and computational resources will be ‘the future’. But the concepts clearly seem to be getting traction.