chapter four

4 Linking business and technology

 

This chapter covers

  • Linking business and technology metrics
  • Measuring technical progress in business terms
  • Applying the L and U of the CLUE process
  • Overcoming organizational obstacles to measuring technical progress

In chapter 3, you selected your first AI project to run. Now you have the research questions that project needs to answer. This chapter shows you how to properly organize that project by using metrics to link a business problem with the technical solution you’re building. It also shows you how to understand what your technical progress means when translated into a business result. Finally, it shows you how to avoid typical organizational obstacles you might meet in your quest to link business and technology.

But before we do all of that, let’s first explain what causes the average organization to fall into the trap of making AI project decisions based on intuition as opposed to data.

4.1       A project can’t be stopped midair

Running any project is more like piloting a plane than driving a car. When you’re piloting a plane, if something happens, you don’t have the option of pulling onto the side of the road and sorting out the problems. And if something happens, the flight has to continue, and you’d have to sort things out while you’re still flying. This section shows why such a situation could incentivize an organization into making many decisions based on instinct rather than data.

4.2       Linking business problems and research questions

4.2.1   Introducing the L part of CLUE

4.2.2   Do you have the right research question?

4.2.3   What questions a metric should be able answer?

4.2.4   Can you make business decisions based on a technical metric?

4.2.5   A metric you don’t understand is a poor business metric

4.2.6   You need the right business metric

4.3       Measuring progress on AI projects

4.4       Linking technical progress with a business metric

4.4.1   Why do we need technical metrics?

4.4.2   What is the profit curve?

4.4.3   Constructing a profit curve for bike rentals

4.4.4   Why is this not taught in college?

4.4.5   Can’t businesses define profit curve themselves?

4.4.6   Understanding technical results in business terms

4.5       Organizational considerations

4.5.1   Profit curve precision depends on the business problem

4.5.2   A profit curve improves over time

4.5.3   It’s about learning, not about being right

4.5.4   Dealing with information hoarding

4.5.5   But we can’t measure that!

4.6       Exercises

4.7       Summary