Big Data, Big Money and Big Opportunities

July 24, 2012
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piles-of-money.jpgIt often worries me that much of the excitement about big data and business analytics relates to marketing initiatives.  In the greater scheme of life, I personally feel that money spent trying to convince me to

piles-of-money.jpgIt often worries me that much of the excitement about big data and business analytics relates to marketing initiatives.  In the greater scheme of life, I personally feel that money spent trying to convince me to drink cola brand A rather than B could be put to better use.  Promoting the health benefits of pure water, maybe.  Tackling real world problems like contaminated water sources, even better.  

I suspect that may be a rather unpopular view in some circles, so in case you’re tempted to stop reading now, I’d like to mention upfront a big data survey that is currently open for your input.  Shawn Rogers and John Myers of EMA and I have constructed a short survey to discover what companies are doing with big data and what challenges they are encountering.  We’d be delighted to hear from you.

But, on to big data and big money… and, in particular, off-shore investment money.  Over the weekend, articles in both the Guardian newspaper in the UK and the BBC reported that a tiny global elite of extraordinarily rich people had some $21 trillion in off-shore tax havens as of the end of 2010, an amount equivalent to the US and Japanese economies combined.  The work that estimated the above figure was commissioned by the Tax Justice Network and carried out by former McKinsey & Co. Chief Economist James Henry.  A press release covering the highlights of the report “The Price of Offshore Revisited” notes that Henry “drew on data from the World Bank, the IMF, the United Nations, central banks, the Bank for International Settlements, and national treasuries, and triangulates his results against data reflecting demand for reserve currency and gold, and data on offshore private banking studies by consulting firms and others”.  The six-page press release reveals some truly staggering figures and is well worth a read.

You may contest the figures and the conclusions, and many will.  But, as the report says–and this is where we get back on topic with big data–“This scandal is made worse by the fact that [official institutions like the Bank for International Settlements, the IMF, the World Bank, the OECD, and the G20] already have much of the data needed to estimate this sector more carefully”.  There is very little of the world’s money that is not represented by and moved about as 1s and 0s in financial computing systems.  There is little doubt that this is, indeed, big data and amenable to the collection and processing we talk about and carry out… when we need marketing information.  We can now reliably detect petty fraud on the world’s voluminous credit card transactions in flight;  so I’m convinced that detecting, storing and analyzing the transactions that moved this wealth off-shore is technically-speaking, a piece of cake.  Perhaps the question is: do we have the will to do so?

I’ll leave you with a more positive spin from the report: “From another angle, this study is really good news. The world has just located a huge pile of financial wealth that might be called upon to contribute to the solution of our most pressing global problems. We have an opportunity to think not only about how to prevent some of the abuses that have led to it, but also to think about how best to make use of the untaxed earnings that it generates.”

In the meantime, read some of the above coverage (I haven’t found a link to the full report) and please take the big data survey, too.