Thursday, May 19, 2011

Big Data: Another Silicon Valley Fad

George: If it was a regular salad, I wouldn’t have said anything. But you had to have the BIG SALAD!

One of the narratives of the current tech bubble is closely related to the Content Big Bang. This explosion of data (aside: I don’t think text is necessarily “content” and much less data) is at once a challenge and an opportunity. According to this piece of groupthink, although managing the deluge of data and storing it is a problem, harnessing this flood of bits and bytes provides manifold insights for data mining. More powerful computing technology, we are told, will open the doors of this future.

But guess who was also a fan of Big Data? The preeminent military strategist of the past twenty years. No, not David Petraeus. I mean Donald "Unknown Unknowns" Rumsfeld. Tim Harford writes in a recent essay to promote his new book, Adapt, that the early (failed) Pentagon strategies in Iraq focused on routing tons of combat data to central headquarters, which processed it and then spit out tactical recommendations like a real-time version of Risk:

It is also a story about the role of technology in decision-making. The U.S. military placed increasing emphasis on the use of “effects based analysis of operations” – using massive amounts of data and computing power to allow commanders at headquarters to absorb information and react quickly, moving units around like chess pieces. Such techniques are hugely useful in some circumstances – a “shock and awe” campaign – but even then they do not always perform as advertised. We’re now discovering that in many campaigns, it is the decision maker on the ground – a captain or even a regular soldier – who has the information that counts and the ability to use it.

Now I know why Amazon keeps giving me such crappy recommendations after over a decade of feeding it data.

Miguel Llorens is a freelance financial translator based in Madrid who works from Spanish into English. He is specialized in equity research, economics, accounting, and investment strategy. He has worked as a translator for Goldman Sachs, the US Government's Open Source Center and H.B.O. International, as well as many small-and-medium-sized brokerages and asset management companies operating in SpainTo contact him, visit his website and write to the address listed there. Feel free to join his LinkedIn network or to follow him on Twitter.

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