Decisions in our lives: How algorithms affect the way we live!
We make decisions in almost every aspect of our lives: Choosing a major in college, the companies we work for, the person we choose to marry. These are examples of “strategic” decisions. Strategic because they affect the course of our entire lives. There is, however, another type of decisions that we make more often and the process of making them happens so quickly that we don’t even notice it: Choosing which clothes to wear, which restaurant to dine in or which meal to order is just to name a few of the countless examples of decisions that we make everyday and often unconsciously.
My current job requires me to work once a month in our office in Downtown San Fransisco. Parking a car in Downtown SF at 8.00 AM is a task that I found really annoying and burdensome. First there is no spots available on the street, second most garages are expensive and always full, third the narrowness and steepness of the streets make it extremely exhausting to drive around.
To deal with this, I use a mobile app that tells me the available parking garages in the area (The picture on the left shows the content it displays when I enter my destination), I make sure I reserve my spot at least 24 hours in advance. However, choosing the best garage is the result of a complex algorithm with a set of multiple variables. The first variable is the price. Some of the garages are cheaper than others. The second variable is the distance from the office which is also different. Another variable might be the type of the garage, some of them are part of hotels with valet service, some aren’t. Another variable might be how close the garage is to Starbucks because I need to grab my coffee on my way to work. All these variables do not have the same weight or importance. In other words, the distance variable is not as important to me as the price, which means I don’t mind walking few extra minutes if it is cheaper to park. As can be seen, the very simple task of parking a car in the RIGHT garage is actually not as simple as it seems to be.
Parking a car was a data-driven decision for me. However not all decisions are created equal. Some of them are data-driven and others are data-inspired, which means they are partially based on data; at some point, we need data to complete the thought process, but the decision itself is based on the overall experience. The third type of decisions is the one that is not based on data at all. This type of decision is mostly based on qualitative variables.
All these decision types are valid ways of thinking, nevertheless, in the business world, we make sure all decisions are data-driven. It is the most costly but our desire to reduce the human error and limit its effect to the max incites us to always go for data-driven or evidence-based decisions. For this reason, we want to quantify everything, even those variables that we thought were impossible to quantify. A relevant analogy would be social media sentiment analysis projects. Their main purpose is to convert users’ posts into structured data, analyze it, interpret it and build scoring models to determine the overall sentiment in the text. We will not discuss Natural Language Processing in this article but this is a good example of what was previously impossible to quantify but now with the advent of social networking sites, it is doable.
Looking at the complexity of the algorithmic decisions that we make every day and the speed at which we make them. I have come to the conclusion that our brain is actually a super powerful computer capable of processing gigantic volumes of data and make significance out of it in a timely manner. The picture on the right is not mine, I scoured the internet and found it to be the best illustrating my point.