Walking the Line Between Innovation and Icky: Big Data and Privacy

These days there’s a lot of talk about big data and its effect on privacy. After all, we now work with vast amounts of data that wasn’t practical, accessible or simple to leverage in the recent past. It used to be true that companies only tapped into 20 percent of their data resources, leaving the remaining 80 percent because it was too costly and difficult to utilize fully.

Not anymore. Today, innovative companies are striving to use all of their data (#AllData). Advances in data mining and big data analytics are enabling innovation at the speed of business. We can mash-up, manipulate and mine information to do great, new insightful things. We can take advantage of derived data, which leverages several points of data to create new data about just about everything, including buying patterns, consumer preferences, business directions—the list goes on and on.

But before we get carried away with the endless possibilities, let’s remember a quote from Voltaire: “With great power comes great responsibility.” Companies that start down this path—and it’s a crowded one these days—must walk a fine line between innovation and icky.

Most everyone appreciates when Amazon makes suggestions for additional purchases based on behavior data. In other scenarios, data that is derived can come as a complete surprise—such as when a retailer uses shopping basket analysis to determine that you have a cold or a baby on the way. When Amazon uses data about you, it feels innovative. When a retailer creates data about you, it feels downright icky.

With the advent of big data technologies, there’s more and more data included in analytic work streams that simply wasn’t available before. Issues around privacy are very fluid right now. Common sense and best practices should prevail during conversations about where the boundaries of innovation and “ickiness” cross.

According to a recent AP story on high-tech fitting rooms, some retailers are testing versions of technically advanced fitting rooms with “smart mirrors” to compete with online retailers. The technology enables a brick-and-mortar retailer to collect much of the same behavior data as online retailers and then use it to recommend other products. So, would you appreciate a mirror that suggests a pair of jeans to go with the red shirt you just tried on or is that an invasion of privacy?

Consumer advocates already are voicing concerns about who ultimately has control over the data collected. Governments worldwide are starting to pass legislature and guidelines around digital privacy. It’s early, but the conversations need to continue so regulations can be developed to protect people from what they don’t fully understand.

Recently, I bought new doorknobs for my kitchen cabinets and for weeks, I was inundated with online ads for doorknobs, even if I was visiting a sports, cooking or news website. Most people don’t know that major websites share data as part of behavioral ad targeting. I personally think it’s cool when Amazon suggests a book I might like based on a previous purchase. But, a sports site trying to sell me more doorknobs falls into the icky camp.

That’s why it’s so important to understand both the context and circumstance of how data will be used. I spoke with an educator from a small school district on the east coast where analytics were being gathered on K-6 students. The goal was to data mine all available information on a student to identify the Key Performance Indictors (KPI) that would correlate to how likely he or she was to graduate high school  A fantastic utilization of data, isn’t it? But there also is a potential downside. How do you share it? Or should you share it? Do the parents deserve to know? Will the knowledge affect how teachers interact with students?

According to an article in Time, a movement is stirring in about 125 schools around the country. Officials are sifting through years of grades from thousands of former students to predict what will happen to current classmates. One university uses data to determine which students would have a higher propensity of graduating while other schools have learned to minimize costs of recruiting new students who they believe are more at risk.

While big data and analytics are incredible, there is a double-edged sword around proper use of this information. For example, there’s a teachers’ union that is working with its state to change the compensation policy to one that is more performance-based. While that would seem all well and good, what if a school gathers data that reveals which students will not do well and then teachers don’t want these students because they could negatively impact their compensation? Or what if students find out their predicted fate and it turns into a self-fulfilling prophecy?

At Dell, we understand innovation comes with responsibility. We strive to keep our finger on the pulse of governance and privacy best practices so we don’t cross the boundaries from innovation to icky. Have any thoughts on walking this fine line? If so, drop me a line at shawn_rogers@dell.com.

About the Author: Shawn Rogers