Pentland’s basic contention is that networks matter. By tracking the “digital breadcrumbs” we all leave behind (through social media, credit cards, or smartphones), business and political leaders can get an idea of how to optimise the flow of information through organisations. And the results of his research are impressive. With a couple of assistants, Pentland analysed 10m transactions by currency traders on a social trading network. They looked at the flow of information, and found that individuals fell on a continuum from “isolated” to “hyperconnected”. Those in the middle (the “decision-making sweet spot”) had a return on investment 30 per cent higher than the rest, who were either too isolated and lacked a diversity of ideas, or were stuck in a noisy “echo chamber” of information and ended up just following the herd. In another example, Pentland helped reorganise the seating plan in the drug discovery unit of a pharmaceutical company, which by itself seemingly boosted performance significantly. THE END OF THEORY
Pentland sometimes talks about such incremental improvements as if they’re free lunches – efficiency gains that businesses are foolish not make the most of. But when the choice is contextualised alongside the other spending decisions firms face, it’s less obvious that big data should take priority. Is better information circulation a more pressing need than a new IT system? Is it worth buying all employees wearable devices to track these interactions? And there’s a worrying conceptual trend in Pentland’s ideas. In 2008, then editor of Wired magazine, Chris Anderson, argued that a “data deluge” would see correlation replace causation. Scientists and businesses would no longer need to test theories in experiments, going back to revise them in light of the results. Instead, they would just pour through reams of figures to spot relationships between variables. It’s an inherently statistical way of thinking, and Anderson argued that this could mean the death of theory. But theory (call it “vision”) can be necessary in management. Pentland’s use of big data will no doubt lead to incremental improvements in business processes. But a myopic focus on tweaking the flow of information may lead some firms to become backward-looking. As the writer Nicholas Carr has argued, acting to streamline informational flows alone “will encourage us to optimise the status quo, rather than to challenge it.” To really break the mould, good old fashioned business vision is still necessary. Track your own work habits
WhatPulse, available as an app for desktops, tablets and smartphones, extends the quantified self even further. The app measures keyboard and mouse activity so you can monitor the time spent doing different tasks on a device. Information is uploaded onto a central website, where you can share with friends.