With the exponential growth of interest in data analytics, either big or small, the attention for the use of algorithms has risen strongly as well. An algorithm is nothing more than a step-by-step procedure for a calculation. That is also what makes it so powerful. Algorithms make our lives easier. Recommendations engines single out the product we have been looking for based on our previous purchases and those of buyers similar to us. The NESTthermostat programs itself and continually adapts to our changing life. Facebook selects the news items that are of interest to us, based on what we have been reading, liking and sharing. All of this would not have been possible without the use of algorithms. Using computers, algorithms can do things close to magic as Arthur C. Clarks third law predicts. Algorithms even let a computer think up new recipes when it gets bored playing Jeopardy! We are experiencing the third great wave of invention and economic disruption; we live in the Age of Algorithms.
Many people see Google as the initiator of the Age of Algorithms; 16 years ago Larry Page and Sergey Brin created their page rank algorithm that enables us to efficiently find what we are looking for on the web. It accelerated the growth of data and the use of algorithms to analyse it. Most of the analyses focus on detecting patterns in the digital bread crumbs we leave behind when wandering on the web. With algorithms companies and organisations try to better understand our needs and wants so they can improve their marketing and sales strategies. Google’s page rank however wasn’t the start of the use of algorithms to solve practical decision problems, the age of algorithms kicked off much earlier than most people think.
Shortly after the Second World War the Pentagon based research group SCOOP was formed. SCOOP stands for Scientific Computation of Optimal Programs. The group set out to find methods for the programming problems of the Air Force. Programming problems are concerned with the efficient allocation of scarce resources to meet some desired objective, for example the determination of time phased requirements of materials in support of a war plan. Mathematically these problems look like this:
Fact is that thousands of real life problems in business, government and the military can be formulated (or approximated) this way. A way (algorithm) to solve these linear programming problems would therefore be very useful and that is exactly what George Dantzig, Chief mathematician of SCOOP, did. In 1947 he invented the simplex method. The impact and power of Danzig’s invention is hard to overstate, I dear to say it’s the most used algorithm today. The journal Computing in Science and Engineering listed it as one of the top 10 algorithms of the twentieth century. It’s probably on your computer as well as it comes standard with Excel.
One of the first problems solved using the simplex method was a diet problem named after Nobel Laureate George Stigler. Dantzig wanted to test if his new method would work well on a rather “large scale” problem. You can try solving the Stigler Diet problem yourself either by hand as Stigler did or use the power of the simplex algorithm to find the optimum. The age of algorithms starts here (or in 1947 actually).