Introducing algorithm-driven decision making — a paradigm shift in business strategy

“Data-driven decision-making” has become such a prevalent concept that it’s often misunderstood or poorly implemented.

Sven Balnojan

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Many businesses, overwhelmed by the idea, choose not to adopt it rather than figure out how to do it effectively.

But when we look at great companies, we see that their success isn’t just about being “data-driven.” It’s about something more fundamental: their focus on processes and algorithms (in the sense of a series of steps, not the computerized version of it).

So, instead of wrestling with the baggage that comes with “data-driven decision-making,” let’s introduce a more precise concept: algorithm-driven decision-making.

What’s Wrong with Data-Driven Decision-Making?

By definition, data-driven decision-making is “an approach to making business decisions that rely heavily on data and analysis rather than solely on intuition or personal experience.”

However, this definition leads to two major misconceptions:

  1. Data must come first before decision-making.
  2. Data equals numbers, often leading to an overreliance on dashboards and BI tools.

Defining Algorithm-Driven Decision-Making

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Sven Balnojan

Head of Marketing @ Arch | Data PM | “Data Mesh in Action” | Join my free data newsletters at http://thdpth.com/ and https://svenbalnojan.gumroad.com/l/oivjd