Second panel discussion
Second panel discussion
- Jens-Peter Seick, Fujitsu
- Roland Schütz, Lufthansa Passage
- Professor Peter Vervest, RSM
- Professor Eric van Heck, RSM
Looking into the future
The two RSM professors, Eric Van Heck and Peter Vervest, were joined on stage by Roland Schütz of Lufthansa and Jens-Peter Seick from Fujitsu.
Asked whether the possibilities for making money by collecting and using big data were almost limitless, Jens-Peter Seick of Lufthansa said it would be possible to collect the data in real time, “but you need to know exactly what kind of data you need. The intelligence of the system is not at the level of the human brain. If conditions change the brain can react, but a big data system relies on programming – and unusual events are not programmed in. So it can't react.”
In automated and high frequency transactions, said Prof. van Heck, the split-second timing cycle is useful for making decisions, but there is always an obstacle, the ‘black swan events’ that are not foreseen in the algorithms. “One minute they are making money, a couple of seconds later they can go wrong,” he said.
Roland Schütz of Lufthansa was asked about the attack on Malaysia Airlines flight MH17 in July 2014. Some airlines avoided Ukrainian airspace before the attack; Lufthansa moved its flight paths afterwards. “What Lufthansa was doing was in the open. Hitting an aircraft is a black swan event,” he said.
Compère Twan Huys asked why some companies kept flying over Ukraine while others took another route. “I presume they had the same information,” Huys postulated.
Risk management is a human decision
“It’s a matter of risk management; so many risk parameters are calculated daily, but in the end it isn’t a machine decision, but a human decision from the pilot. He even decides how much fuel he takes on board. These should remain human decisions,” said Schütz.
A member of the audience asked how long it would be before big data was used to measure health – with smart chips implanted in the body to collect data and deliver it to doctors.
“Some of these variables are absolutely on our road map,” said Jens-Peter Seick. “We see a lot of very reasonable applications for the human body, for example a sleep suit for a baby that contains sensors and can reassure parents that the baby is sleeping peacefully. Those things will come.
“I personally don't think that the sensor will go in the body. It can go on the body,” he said, and added it would be important to make sure this kind of sensitive data is kept secure. The intention is not for insurance companies to use it.
Seick reminded the audience that Japanese technologists had already produced a toilet seat that can detect illnesses using infra-red sensors. It would be easy to send the data from a smart toilet seat to a computer, but the security of such sensitive personal data is a big subject that needs a lot more discussion. “Transporting data needs security, it should not be collected inappropriately,” he said.
A discussion about using mobile phones followed. Of course, they contain location data and a camera ‘which can be read from outside’, Seick told the audience, and pointed out the difference between simply reading bank account data and making transactions on a mobile phone. “Of course, the banks do everything they can to protect your data,” he added.
A member of the audience brought up Jaron Lanier and the ‘Siren Servers’ . “The guys with the best algorithms will swallow all the data to one or two central points; perhaps Google and Facebook will own it all within a few years. What do you say to that?” asked the member of the audience.
Personal data gets very personal
The panel’s answer took in the vast range and potential of big data, a short discussion about Amazon.com founder Jeff Bezos and his idea for the ‘everything store’. Delivering food anywhere in the world within an hour – as he wants – would need lots of data relating to locations, logistics and personal behaviour. The audience was also curious to know more about the data available from credit card spending patterns.
Roland Schütz from Lufthansa was asked how the company addresses political risks from developing and developed countries, and competes against state controlled businesses. “The competition is not fair, obviously,” he commented, and predicted that the industry would become consolidated in the long term. “Maybe the whole industry will look different in a decade,” he said.
Will we still need managers?
And then came the question that had probably crossed the mind of every member of the audience at some point during the afternoon: when analytics are effective enough to be able to automate decisions based on big data, will we still need managers?
Prof. Peter Vervest first referred to a recent McKinsey article that conjectured upon ‘the end of management’, and gave his view. “I think management tasks will change in the future. Traditional tasks are going away quickly.”
Prof. Eric van Heck said it was an interesting question. Companies should embrace the learning cycles and acknowledge the trends away from top-down decision-making towards a combination of human-decision making with advanced software. This would require a different set of management skills as well as new skills for using the technology skills. “And every manager will need them in their toolset,” he concluded. “Business schools will need to provide a different approach for MBAs,” he said.
A networking reception followed the conclusion of the RSM Leadership Summit 2014.