Business model design in the intelligence era
By: Kelly Luo
Tags: Business Intelligence, Business, Business Strategist, Intelligence, Business Strategy

In the so-called intelligent age, we have faced a huge amount of data. Obviously, people can no longer cope with such a large amount of data. Therefore, it is necessary to rely on various technical means to analyze and process data and make decisions.

What are the key features of the intelligence era?

There are two key features of the intelligence era:

Network collaboration

Network collaboration means a large-scale, multi-role, real-time interaction to solve specific problems.

Let’s take Wikipedia as an example. Wikipedia is a very open platform for knowledge co-creation. In principle, anyone in the world can post their thoughts and content on it. Everyone also has the right to modify any entry. Wikipedia is an online knowledge base without the coordination of any central government.

2. Data intelligence

The essence of data intelligence is that machines can directly make decisions instead of human decision makers.

It’s different from the traditional Business Intelligence (BI) which analyzes data and provides decision support.

The most direct example is Google search. When you enter a question, the system automatically finds all relevant information you need through algorithms.

Data intelligence heavily relies on three factors: cloud computing, big data and algorithms.

— Cloud computing allows us to store and calculate massive amounts of data at low costs.

— The purpose of the algorithm is to automate the human decision making process. The algorithm engineer behind it abstracts the human decision-making process into a model, uses a mathematical method to find an approximate solution to the model, and then uses code to turn the solution into a machine executable command.

— The most important thing is to continuously optimize the machine’s decision-making through learning massive data collected.

What kind of a business model is suitable for the intelligence era?

The essence of any business is to make money. Whoever can target customers and understand customers more precisely will increase the efficiency and generate more revenues, and resources will follow.

To survive and thrive in the intelligence era, we need a closed-loop framework to refine our business model in order to ensure a sustainable business.

A closed-loop framework of a business model in the intelligence era requires the following four parts. These four parts are user-centric:

Dynamic data: Collect data in real time to better understand users and accurately allocate resources for personalization purpose.

2. Usage Scenarios: What does the customer buy the product for? What is a goal to be achieved?

3. Algorithmization: In order to achieve the customer’s goal, what should be done based on the collected data?

4. Service delivery: All activities and processes that help customers achieve their goals.

Let me explain the framework and these four parts in detail through some failure and success cases.

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