The Ontology: Operating at optimum complexity — as simply as possible

The Ontology: Operating at optimum complexity — as simply as possible

Editor’s Note: In this blog post, Senior Director of Enterprise Technology Markus Löffler discusses the principles underlying his belief that the Palantir Foundry Ontology can transform any enterprise.

I believe the Ontology is the foundational element for the modern software stack.

In this post, I will tell you why.

As a physicist, I saw the combined power of well-structured models of reality and analytical models (such as those in quantum physics, string theory, and thermodynamics). I carried this over to my time as a leader in technology-driven business transformations, where I saw that organizations lacked just this: well-structured models of their own reality that they could then apply analytical methods to, with the ultimate aim of understanding and operating their businesses in a stable, scalable manner.

Despite massive investments in technology, many businesses didn’t have what they needed to survive and thrive. And they didn’t know how or where to get it.

That is because they needed an entirely new category of software: the Ontology.

I believe there are three principles underlying its transformative power:

1. Data, analytics, and models created by technology are meaningless without connectivity to real-world action.
2. Organizations must embrace complexity to survive.
3. Technology should empower businesses to understand, achieve, and sustain Optimum Complexity — as simply as possible.

Expanding on each one:

1. Data, analytics, and models created by technology are meaningless without connectivity to real-world action.

Organizations use technology solutions to create data, analytics, and models that serve specific purposes. In the private sector, these purposes might be managing the supply chain in volatile times or achieving 30% energy savings for the same production volume; in the public sector, they might be distributing vaccines or fighting organized crime. Where many of these solutions fall short, however, is that they surface information to the organization without connecting those insights to a person or a process that can actually effectuate change.

Even fewer solutions allow organizations to take the action triggered by that initial insight and feed information from it — the action itself, associated conditions, the result — back into the system, creating a feedback loop to capture on-the-ground truth, from insight to impact.

Without this feedback loop, organizations lack an accurate picture of themselves and fall short in creating value with data and analytics. Technology should provide a foundation for uniting all elements of an organization’s existence as it changes over time — from data to decisions — creating a digital representation of the business system around the most stable elements of the business, and linking that to day-to-day operations.

This brings me to another important point: for models of a business, often called a “digital twin” or, more traditionally, a “process model” or a “capability map,” it is essential to distill which elements are stable and which are variable. Often, these models are constructed in largely the opposite manner: they fix what is variable and miss what is stable. As a result, they fail to produce business benefit or are expensive to produce and maintain (if they work at all).

The Palantir Foundry Ontology, however, does this exactly right by unlocking connectivity between data, analytic, and operational systems. It transforms digital assets — data, models, and processes — into a dynamic, actionable foundation that powers intelligent operations:

• Objects digitally represent the real-world entities, relationships and events that constitute a business.
• Relations represent the connections between real-world entities, events and processes.
• Actions capture the kinetics between objects and orchestrate real-world change through enterprise systems. Actions can be mapped from existing processes or existing models.
• Writeback captures the impact of actions, processes, and related data to ensure that the Ontology — and the actions it drives — steadily improve over time. Information can be written back to both Palantir Foundry and third-party systems, ensuring that decisions are always persisted in the systems that drive ongoing operations.
• Ontology Process Flows represent the decision-making flows throughout the organization, with embedded governance and real-time understanding of how interconnected conditions are affecting global outcomes.
• Ontology Scenarios allow the business to safely simulate, at full fidelity, the consequences of changing individual actions, or entire courses of action.

This is built on the base of Foundry’s military-grade technology, meaning that:

• Built-in role-, classification-, and purpose-based access controls enable organizations to institute granular privacy and security controls that permeate the system.
• Auditability ensures that users with appropriate permissions have access to the complete history of all data that enters the system and all user actions, providing a comprehensive picture of chains of decision-making and the associated context.
• Safe, next-generation collaboration, change reconciliation, and versioning allow enterprises to treat their businesses as code; the system can accommodate new workflows, data, models, and user-generated data, offering stability while maintaining speed of delivery.

2. Organizations must embrace complexity to survive.

Organizations are inherently and necessarily complex. Nothing worth doing is free of complexity.

The trick, then, becomes distinguishing between Optimum Complexity and Unnecessary Complexity.

Optimum Complexity is idiosyncratic across organizations. It is the complexity necessary to achieve your purpose — no more, no less. Unnecessary Complexity is any complexity beyond Optimum Complexity.

To illustrate this concept as it applies to information technology, I will borrow an example from the automotive industry: Volkswagen Group’s “Modularer Querbaukasten” (MQB), or in English, the “Modular Transversal Toolkit.” The MQB is one of several platforms the company uses to manufacture vehicles, and is the basis for around 40 models for Audi, Seat, Skoda, and Volkswagen. Where Volkswagen can realize synergies, they use the same platforms to produce different vehicles. Where differentiation creates incremental value for the customer, diversification across models or even brands (i.e., additional complexity) is implemented. Leveraging these platforms allows Volkswagen to satisfy the desires of their different customers — each model has a different brand image, aesthetic, and functionality — while simultaneously enabling the company to produce cars more efficiently and at a higher quality.

That is Optimum Complexity.

3. Technology should empower businesses to understand, achieve, and sustain Optimum Complexity — as simply as possible.

Many technology solutions seek to oversimplify complexity (or worse — to ignore it entirely). This is counterproductive, as organizations need software that enables them to continuously operate at Optimum Complexity.

As I alluded to above, every company has made massive investments in technology in the past decade(s). These investments provide varying degrees of value. However, virtually no organization has a platform that empowers these investments to work together at scale. As a result, point solutions form a jigsaw architecture that obfuscates the enterprise’s view of Optimum Complexity, hindering their ability to move towards it, let alone sustain it.

In order to operate at Optimum Complexity, organizations need the Ontology. With it, they can:

• Focus by settling on a common system and redirecting resources to it;
• Streamline by identifying and decommissioning parts of the broader technology landscape that are not additive;
• Act by leveraging this common system to drive business outcomes;
• Evolve by writing information back into this common system so both it and the actions that it informs can develop and improve over time; and
• Build by providing a robust but flexible foundation on which to fix stable elements while enabling maximum variability for new elements.

Because of this, I believe the Ontology has the power to transform any business.

Author
Markus Löffler, Senior Director of Enterprise Technology, Palantir

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The Ontology: Operating at optimum complexity — as simply as possible was originally published in Palantir Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.