Wondering how you can turn your business into an algorithmic one? An algorithmic enterprise focuses on the use and translation of data and information for better business decisions. Whether you have a bare bones staff or a large execution budget, any business can become algorithmic. “It’s really a state of mind and a set of capabilities,” explained David Rosen, strategist and thought leader of TIBCO Software, on the latest episode of the Hub & Spoken podcast from Cynozure, with Jason Foster.
According to Mr. Rosen, an algorithmic business requires three things:
- Analytics savvy
- Strong technical capabilities
- Business acumen of your particular industry and customer-base
Key to success is establishing a culture that is data driven. One that isn’t always putting forth answers, but rather puts forward the ability to explore answers through scientific methods.
As Mr Rosen puts it,”Culture around not always knowing the answer; the willingness to explore. We live in a world where we don’t need to have the answer, but we need to have a process which allows us to establish the test, come up with the conclusion — and continue to adapt ”
To put this in a real-life business example, rather than flooding a market in advance with a product they think will sell, an algorithmic business will put lower quantities of a product in several markets to test and learn to allow the consumers to tell them what resonates.
They then take this data and retrain their business model to truly give the customer the products and services they want. It’s this continuous learning and updating through data driven decisions, this ability to remain open-minded, which makes a true algorithmic business.
And, they don’t just look at quantitative numbers. They actually get qualitative feedback from customers to get the true soft pain points of their products and services. It’s not just about analytics but finding the reasons behind those analytics that makes an algorithmic business stand out.
A point on success discussed by Mr. Rosen and Mr. Foster is that it’s not just a way to cut costs. Leading organizations don’t automate processes to save money, but rather they free up their employees to deliver better customer service and experiences. They also don’t view artificial intelligence as a way to throw jobs out, but to augment the intelligence of the workers they currently have to further improve customer interactions and service.
Listen to this podcast for a thought-provoking discussion about what makes an algorithmic enterprise and how to turn yours into one.