For many years the computer profession and business have formed a partnership which operated under what can be termed an open-loop architecture. Advances in data warehouse technology and the Internet have enabled what can be termed a closed-loop architecture for the marriage of business and computers. With a closed-loop business/computer architecture, new business opportunities arise that were never before possible.
In an open-loop architecture, business decisions made by management have an impact in the marketplace, and the impact of that decision is measured only indirectly by the corporation's computer systems. For example, if a bank vice president decides to raise interest rates, the results of the decision impact the loan officers and those applying for loans. The results are measured indirectly as loan applications increase or decrease. As another example, suppose an insurance executive decides to offer a new kind of insurance. The market expresses its approval or disapproval by buying or not buying the new insurance offering. By measuring the response within the open-loop architecture, the marketplace response to the insurance executive's decision is quantified. In every case of an open-loop business/computer architecture, the impact of the corporate decision is felt indirectly through the actions taken by the marketplace and is measured indirectly by the computer systems that run the corporation.
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