If you are the person with the CIO job, the rest of the company is looking at you for help in making your company more competitive. What this means is that the company needs to always be improving how they do things – they need to become quicker, better, and faster. This all sounds great and we know that if we use the power of information technology we can certainly make some of this happen. However, what the person in the CIO position needs to find out is how all of that data that they are collecting can be used to help the company teach itself how to become better. It turns that this can be done. The secret lies in models.
It’s All About Models
The first thing that CIOs need to understand is that there are already companies out there that are using the data that they collect to become better. A great example of this is the pizza maker Dominos. Although they are already a leader in their marketplace, they have taken the extra step and are using software to both maintain their leadership position and to extend their dominance.
We are on the cusp of the next great innovation in business software. CIOs are going to be asked to help their companies to structure their business processes to create continuous learning models that will be built to use “closed loop data”. When a company can create such a beast, it will create a reinforcing circle for them: Over time their products will become better. This will allow the company to collect more data about their customers and their products. This will allow them to then build better models. This will then make their products even better. And so on. These companies are being referred to as model-driven businesses. Such companies are being created inside of existing firms and at startups.
Pick up any magazine that is targeted towards CIOs and you’ll discover that they are filled with stories about cool new technology such as big data and artificial intelligence. However, what CIOs need to realize is that models are where the real power behind these new tools is coming from. A model driven business is one in which models are used to make decisions that are used in the company’s key decision processes.
How Continuously Learning Models Will Change The Future
So just exactly what is a model? A model is a type of decision framework which has its logic determined by algorithms. The algorithm is created based on data that has been collected instead of having it explicitly programmed by a developer. These models then create predictions that can be used to make decisions. Once a model has been created, it then has the ability to learn from both its successes and its failures far more rapidly than a person could.
In order to create a model, a company needs software to collect data and then processes that can use that data to then create models. Additionally the firm is going to need a software tool that will allow them to take action based on what their models are telling them. We need to understand that a model driven business is different from a data driven business. We view a data driven business as being one that collects data and then analyzes it in order to help employees make better business decisions. A model driven business creates a system built around models that keep getting better and better and which are used to define the business.
In the end, it’s really all about having the CIO help the company to create closed loop models. This means that every time a model makes a recommendation the customer’s response is captured and then that data is used to make the model even better. When a company uses closed loop models they know the inputs, the outputs, the predictions that the model made, and the result of that prediction. What all of this means is that businesses that are able to become model-driven will become more valuable.
What All Of This Means For You
In today’s data driven world, the rest of the company has come to rely on the CIO to show the company how it can become more valuable. Almost all companies collect a great deal of data about their customers and their products. It’s the job of the CIO to determine how best to make use of this data. In order to help the company to get better at making predictions and guiding customers who are shopping, companies need to get good at creating models.
The use of models to drive a company’s decisions is not something new. There are already a number of companies that are using the data that they collect to make informed decisions. The goal is to create continuous learning models that will be built to use “closed loop data”. Models like this continue to learn from new data and keep getting better and better. The arrival of new technologies may capture the attention of a CIO, but they need to realize that behind those new technologies are the models that are driving them. A model is a decision framework that is created by data. In order to create a model-driven business a CIO has to provide the company with the tools needed to collect, process, and then model the data. The ultimate goal is to create closed loop models that can use data to become even better.
The role of a CIO in a company has never been more important. As firms start to realize that all of the data that they have been collecting can now be used to help them make better decisions, the help of the CIO is needed. Using the company’s data to create closed loop models will help the company to improve both their products and how they interact with their customers. CIOs need to start to put the company’s data to work !
Question For You: What should a CIO do if a model starts to make poor recommendations?
P.S.: Free subscriptions to The Accidental Successful CIO Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!
What We’ll Be Talking About Next Time
As is the case with all CIO’s, you’d like to be the best boss that you can possibly be. There are a lot of characteristics of good bosses: they treat their employees with respect, they give good directions, and they praise people when they accomplish something significant. However, even if you are able to do some or all of these things and support the importance of information technology, is it possible that you are still a bad boss? One characteristic of a bad boss would be one that wastes other peoples time. Could you be doing this and not even be aware of it?