Data for change: moving towards a new data paradigm
By 2020, citizens of the world will have between 20 and 30 billion connected devices, depending on the source you pick and how you count them. That’s 3-4 devices per person, on average. All those devices churn out a hefty amount of data, 80% of which is privately owned, all contributing to the mountain of digital data stored in the world, 90% of which was created just in the last few years. These are a few of the fascinating points we heard during our webinar Data for Change last week, which explored how data is changing our world, and how it can help your organization prosper in the meantime.
Sarah Williams, Director of the Civic Data Design Lab, and John Pflueger, Dell’s Principal Environmental Strategist, joined me to discuss the dramatic shift we are currently experiencing in how we use and produce data: a new data paradigm. Crucially, we explored how open and big data can have positive environmental and societal impacts.
A new data paradigm
“…What the new data paradigm currently offers is the possibility of exhaustive, highly detailed, real time intelligence on all aspects of an organisation… from which they can formulate wise courses of action.”
Most experts consider this new data paradigm to be only the tip of the iceberg; what we consider large amounts of data today will likely be insignificant in a few years. While Sarah and John noted the fact that (big and open) data analytics is maturing and being used more and more widely, it was clear from our conversation that a large portion of data potential remains untapped.
Capturing value from data
Most companies are capturing only a fraction of the potential value of data analytics, the leading companies are succeeding in using it for location-based data and retail, according to a recent study from McKinsey. McKinsey estimates that pioneer companies using location-based data (GPS navigation services, mobile phone location-based service applications, and geo-targeted mobile advertising services) are roughly capturing 50% of the billions of dollars of potential revenue that could be generated by applying data analytics to services like geo-targeted mobile advertising.
Use of cutting-edge data analytics has caught on quickly in the retail sector, compared with other industries, due to the industry’s narrow margins and pressure from retail giants Amazon and Walmart. The industry has put data to work in a range of ways, from ‘cross-selling’ products a consumer didn’t even know they needed, to reducing costs through the value chain. However, there is still more that can be done – it is estimated that only 30% of the potential value has been captured.
So why are there so few organizations tapping the “new oil” of our era? Why isn’t data being taken advantage of as quickly as many would expect? Some of the reasons include:
• Penetration to GPS globally
• Lack of analytical talent
• Siloed data within companies
• Siloed data within legacy IT systems
• Leadership sceptical of impact
And, why don’t we see more sustainability initiatives using more data? GPS advertising and retail industry data adoption are clearly missing the sustainability angle. They do, however, hint at what could be achieved if data analysis for decision-making and innovation were used to tackle the pressing challenges of today. Data analytics has the potential to detonate a new wave of positive disruptive innovation. What if we had “recommended for you” notifications from utilities that encouraged reduced energy use and cost savings at home? What if CVS and City Mapper teamed-up to promote more sustainable, cheaper ways to get around in cities while encouraging healthier lifestyles? What if Target or Walmart had greenhouses in every store that knew the exact amount of water and nutrients needed by a plant in real time to maximize sustainable local food production?
How to use data for change
“We want to put more back into society than what we’re taking out, and be restorative. Zero impact is not sufficient. “ John Pfluegger, Dell Principal Environmental Strategist
The most interesting part of our conversation with Sarah and John focused on how we can use data for public benefit, and how it can help us to put more back into society than we take out. One first step to use data is to analyze it and explore how to communicate it in a way that enable the establishment of new partnerships - this is something essential, as Sarah showed through their data visualizations. A common challenge while using large amounts of data is complexity, both in comprehension and communication. One way to navigate that complexity is to separate and organise information to visualize it, by creating maps, graphs or models that stylize the information into something digestible for the reader.
We also discussed on a higher level how the new data paradigm is laying the foundation for a number of changes that can drive us toward a more sustainable future:
- Reducing inefficiencies and replacing, improving or supporting human decision-making with algorithms.
- Creating transparency and improving performance through open standards.
- Eliminating waste, fraud and abuse.
- Providing predictive capabilities to improve mission outcomes – including tracking sustainability.
- Innovating new business models and stakeholder services.
There are a number of examples of organizations that are embracing these principles. Examples include Schneider, with their Ecostruxure initiative that reduces inefficiencies in factories and improves decision-making in production lines; Nike, who has opened up access to their production information through a manufacturing map platform, increasing transparency and trust; and Transport for London, which is encouraging innovation by opening their data to the apps market, saving them between £15-42m since 2009.
While open data and analytics have incredible potential, there is of course a dark side; a commonly discussed concern is how we will responsibly manage the increasing ubiquity of data and sophisticated algorithms. As Cathy O’Neil describes in her acclaimed book Weapons of Math Destruction, “We must start early to demand that systems that hold algorithms accountable become ubiquitous as well.” We need an ethical framework to hold algorithms accountable for the long term, this is a topic for another webinar.
Like other emergent tech, data analytics is creating both opportunities and risks around the sustainability challenges we are trying to tackle at Forum for the Future. That’s why we have created a technology catalyst. Major shifts and disruptions happen when ‘big picture’ pressures, like changing political values or major technological improvements, combine with innovations to disrupt business as usual. Technology is at the heart of disruption right now – it is both reshaping the social landscape and providing multiple niche innovations.
Our vision is for the disruption driven by data analytics and other emergent technology to be positive for society and the environment – taking our food, energy and other systems in a sustainable direction.
If you want to know more about the information we discussed during the webinar and explore using data to help your organization on its way to sustainability, please get in touch, firstname.lastname@example.org
 The Data Revolution. Sage, 2014 - Rob Kitchin