MIS522 Case Analysis (9/7/16): “With Big Data Comes Big Responsibility”

Case Citation:

Pentland, Alex “Sandy”, and Scott Berinato. “With Big Data Comes Big Responsibility.” Harvard Business Review, November 2014, pp. 101-104, https://cc.csusm.edu/pluginfile.php/74301/mod_resource/content/1/With%20Big%20Data%20Comes%20Big%20Responsibility..pdf. Accessed 6 September 2016.

Analysis:

In this Harvard Business Review article, MIT Media Lab’s Alex Pentland argues that data is all around us, in the form of the posts we make on Facebook to the heart rate monitor we wear while working out, to the data we create when we drop off our kids at school with our technology enabled automobile.

As consumers start to become aware that their data – however miniscule – is being collected, many begin to question their level of comfort with allowing a company to have access to their personal information. With more products having built in sensors, some consumers feel an increasing sense of being spied on. Furthermore, because there is so much information about the individual now available, this same information has the potential to be exploited, either by a malicious individual or a company. Because of this, there is a battle underway in the industry as to whether consumers have a right to know what kind of their personal information is being collected.

Pentland proposes the concept of a “New Deal on Data”, which is a reference to the “New Deal” social and economic reforms under President Franklin D Roosevelt in the United States in the 1930s. Pentland’s “New Deal on Data” involves providing consumers with the ability to review the data being collected and to control how that data should be handled (e.g., they could “opt in to” or “opt out of” the data’s release). Ideally, the “New Deal on Data” would provide transparency and ultimately, give the individual ownership of his/her own data, rather than ownership by a corporation or entity.

This “New Deal” proposal is at odds with how many businesses operate today, relying on unrestricted access to a consumer’s data. In the end, says Pentland, this strategy has high costs in terms of data breaches and collateral damage in the form of financial and brand risk. In the end, the theory is that if people believe it’s safe to share information, they will be more willing to do so, and everyone wins.

One real life example of the “New Deal” in practice is a safe harbor or “sandbox” town in Trento, Italy. Hundreds of families are putting the “New Deal” to the test, by securely receiving notifications of the data generated about them, and also controlling how this data is used. This experiment is a collaboration between two telecom companies as a way to gauge how data protection regulation might be borne out in the EU. The preliminary findings are promising and indicate that the people in the Trento experiment tend to share much more than others living outside of the “New Deal” rules.

While the current corporate paradigm of collect-all-your-data (a euphemism for the author’s term, “steal-all-your-data”) is business as usual, Pentland believes the New Deal on Data is scalable and achievable. People are disenchanted and skeptical, and the New Deal provides an actionable proposal that will help address consumer concerns over data privacy. Companies that embrace a business model where the relationship between them and the consumer is more respectful and more balanced will win in the long term.

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