Google’s algorithm and the importance of data

Wired magazine (the US version) recently had an article on Google’s algorithm and what makes it so special.  The importance of the data it collects is highlighted:

The data people generate when they search — what results they click on, what words they replace in the query when they’re unsatisfied, how their queries match with their physical locations — turns out to be an invaluable resource in discovering new signals and improving the relevance of results…    Google has used its huge mass of collected data to bolster its algorithm with an amazingly deep knowledge base that helps interpret the complex intent of cryptic queries.

The importance of wisely using the data that is collected – and so doing quickly – has come up recently in a couple of really interesting posts:

Data. The foundation for everything on an intelligent, interconnected, instrumented planet

The reason we instrument the world is to generate and collect data. The reason we collect data is to analyze it. The reason to analyze data is to understand better the world around us. And the reason to understand the world around us better is to make decisions that improve that world.

On A Smarter Planet … Some Organizations Will Be Smarter-er Than Others

The losers will be those organizations still coping with information overload, unable to make heads or tails of what they know (Enterprise Amnesia).  They will miss the obvious.  Their costs will soar, their customer satisfaction will drop and confidence in their brand will erode.  You will get duplicate mailings from them.  They will try to sell you something you already bought from them weeks ago.

The winners will be those organizations that make better decisions, faster.  How fast?  Fast enough to do something smart as the transaction is happening, not minutes, hours, or days later.

The closer to real-time an organization can operate, the more competitive it will be (Enterprise Intelligence).  They will be more efficient in how they deliver their products or services, their customers will be happier, and they will be able to stop many more bad things (e.g., fraud) from happening before they happen.

Tim O’Reilly recently gave a talk about the importance of data.  I know that the slides are available and you can get some meaning from those, but the whole talk isn’t online yet.  When it is, I’ll comment on it further…  but this definitely looks to be a theme to follow closely.

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