“Smarter Information, Smarter Consumers,” — Review of an Article in Harvard Business Review, by Richard H. Thaler and Will Tucker

Review by John Hnatio, Chief Science Officer

FoodQuestTQ LLC

A well-written and entertaining article BUT “choice engines” are nothing really new. Turbo Tax is a good example. Turbo Tax takes the labyrinth of complex and confusing government tax regulations and interprets them to produce a simple and easy to use question and answer format to do your taxes.

This new type of thinking, i.e., bridging the gap between too much information and our ability to interpret it is nothing new either. This is what we created modern computers to do for us.

Remember Konrad Zuse (1910-1995) the construction engineer for the Henschel Aircraft Company in Berlin, Germany at the beginning of WWII?

You see, Zuse was having a lot of trouble keeping track of hundreds engineering calculations using an old slide rule and an adding machine so he decided to do something about it. Put very simply, he couldn’t add, subtract, multiply and divide a whole big bunch of numbers all at the same time. I personally love this guy because I hate using a slide rule and I am a lousy bug numbers guy! Thank heaven for the modern calculator.

Well it was Zuse who, all the way back in 1936, created the first freely programmable binary computer. Using a control, a memory, and a calculator to do the arithmetic, Zuse created the Z-1, which was his first mechanical computer.

Zuse followed up in short order on the Z-2 and the Z-3 electro-mechanical computers in 1939 and 1941, respectively. In 1941, the Z3 contained almost all of the features of a modern computer as defined by John von Neumann and his colleagues in 1946. All of the engineering students in the world should really love these guys. They are the reason that engineers no longer know how to do long division.

Well, the truth be told, all Zuse was really doing is creating the first “choice engine.” He used his computers to systematically structure otherwise overwhelming data sets (a whole big bunch of numbers) to save time and reduce the opportunity for mistakes. In other words, Zuse created machines to help “take the thinking out of thinking about the little stuff” so that he could focus on the bigger picture. Or, as Thaler and Tucker might put it, he simply wanted to do more real work by not having to read the fine print all of the time!

The future that Thaler and Tucker muse about is already a significant part of the academic literature too. From 2001 through 2004, a poor doctoral student at The George Washington University (that would be me) conducted a major program of research on how to capture and use the types of large data sets Thaler and Tucker talk about. The whole idea was to bridge the gap between quantitative scientific reality (as contained in those big boring data sets) with qualitative human social process (what people really want) in ways that allow those of us who are not scientific geniuses like Konrad Zuse (people like me) to more effectively manage the complex events and situations that we all run into in our everyday lives. What the research is all about is putting the idea of Turbo Tax on steroids.

The future that Thaler and Tucker muse about is already in commerce too. It’s already been patented. A small company in Frederick, Maryland (that would be my company) owns the patent. The company is already harvesting and structuring data from public sources relating to the safety of America’s food supply to create what Thaler and Tucker call “choice engines” for the food industry.

But what’s most exciting about the new technology of “pre-interpreting large data for the individual user” is that it can be applied in any situation where the data is available. It can be used the same way across all industry verticals to reduce costs, enhance safety and create resilience. (Resilience is just fancy government jargon for reliability.) This is where we can say that Thaler and Tucker’s work with the Obama Administration represents a great contribution.

The future that Thaler and Tucker talk about can become a larger reality for all of us much quicker with the cooperation of our own government. The reality is that the ability to interpret the data to produce “choice engines” already exists and is, in fact, now being used. But too often, the government itself slows the process of innovation by not openly sharing the data with the same people who paid for it in the first place (that would be us-the American taxpayer). The government’s penchant for secrecy too often becomes the obstacle that precludes our own success!

Thank-you Drs. Thaler and Tucker for a fun and entertaining read. Keep up the good work!

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[1] http://inventors.about.com/library/weekly/aa050298.htm