Algorithms – your intelligence partner

Algorithms – your intelligence partner

We live in a world driven by data, generated every day by countless different sources – sensors, texts, pictures, sounds, videos and databases. Businesses are slowly but surely turning to this data for decision making. However, business success can only be achieved if we can connect the dots and generate insights from this data.

Upon closer inspection, data can be shaped into meaningful bits of information that can assist in delivering better products and services to effectively address customer requirements. To find some actionable insights, most companies rely on data science, which involves using algorithms to analyse large amounts of data to understand its meaning.

Algorithms are sets of steps to accomplish a task. Algorithms can perform calculation, data processing and automated reasoning tasks. As humans, we are running simple algorithms through our minds every day with questions such as: could I have taken a less congested route to work; is there a better way to make a tasty, hassle-free meal; could I have organised my day differently to be more productive?

In computer science, it’s the same. Facebook, for example, uses algorithms to suggest friends for you to connect with. Google Maps uses a route-finding algorithm to indicate the available and best routes for you to get to your destination. A good algorithm solves a problem and does so efficiently.

There are many benefits to using algorithms in business. We run algorithms to obtain answers to important questions. Sometimes the algorithms provide results that generate more questions, but ultimately algorithms indicate patterns and provide insights to decision makers on when things should change or when there is an urgent need for something to happen.

Each algorithm result provides an answer and each answer helps to solve a unique piece of a puzzle that ultimately completes the picture. The power of the algorithm is solving the puzzle within a puzzle.

The applications for algorithms are numerous. In the freight industry, a route-finding algorithm could determine in seconds the most efficient route for a truck to deliver packages, starting and ending the day at a depot. It would take weeks to manually go through all the possibilities. Algorithms also help monitor input from vehicle tracking devices to assist in determining efficiencies and cost optimisation, and help address unsafe driver behaviour.

Insurance companies use predetermined algorithms to assess risk and calculate policy rates for customers accordingly. Algorithms also help insurers avoid settling false claims by flagging anomalies or criteria for concern.

In insurance, algorithms can also transform data into insight to help address customer needs effectively and provide more personalised and behaviour-based products and services. For example, a trendy millennial who often takes an Uber rather than driving her own car could be offered a pay-per-drive insurance policy.

In just about any area, algorithms allow massive computational power to be harnessed to do things that people really need and care about. Imagine having a personalised algorithm that provides insight into why you feel the way that you do, based on analysis of the food you have eaten and the activities you have completed. You would then know that takeaways make you feel lethargic, chocolate triggers a headache and traffic induces insomnia, and you could take the appropriate actions to adjust your lifestyle accordingly. These algorithm insights would enable you to positively adjust your activities, and for business it is the same.

In a world where everything is connected, with changing consumer behaviour and technological advancements, businesses need to think about how they stay relevant and protect themselves to ensure they’re successful into the future. This is particularly relevant to insurers that are no longer expected to just cover the unpredictable, but to anticipate the unpredictable too. There has never been a better time to use algorithms to obtain intelligence from data.