16 Tech Terms And Concepts Every Business Leader Should Understand

Tech leaders are expected to stay up to date on all the latest tech concepts, but in today’s businesses, there are certain tech terms every leader needs to understand—no matter their specialty. Without a thorough grounding in the tech processes and tools modern companies require to operate, leaders can’t make the correct strategic decisions, communicate effectively with the tech professionals they work with or safely and fully serve their customers.

From learning how essential tech tools really operate to understanding how to protect their assets in an increasingly digital world, expanding their tech knowledge can help any leader become better at their job. Here, 16 members of Forbes Technology Council share common technology terms and concepts many nontech people misunderstand, what they actually mean and why they’re important.

1. Compliance

One business-critical term that is often misused and misunderstood by executives is “compliance.” Regularly conflated with cybersecurity, compliance is more than simply making sure that your organization has good security policies in place. It encompasses industry best practices around policies, processes, configurations and operating procedures. – Husein Sharaf, Cloudforce

2. Multifactor/Two-Factor Authentication

A ubiquitous, hot-button topic that is often misunderstood is multifactor (or two-factor) authentication. Multifactor authentication is an algorithm in which the user needs to present two or more pieces of evidence to confirm identification. This level of security is critical nowadays with the digital footprints we generate. Multifactor authentication provides layers to your digital assets; you’re not hanging on one password to protect yourself. – Kevin Huber, IT Outlet

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3. Interoperability

Interoperability is key! It refers to the ability of one computer to connect and communicate with another easily, on demand and in real time, even if they were built by different companies. Exchanging data between applications, databases and other computer systems is crucial to streamlining and operationalizing modern businesses. – Olga V. Mack, Parley Pro

4. Smart Automation

There’s often a misconception that introducing smart automation means removing humans entirely from every workflow. However, automation is primarily a tool that frees up humans from tedious and repetitive tasks. Smart automation systems involve human input by definition. They’re designed to take administrative work off people’s plates and even go a step further by flagging when the human brain is needed. – Robert Lindner, veda data solutions (veda)

5. DevOps

Many people misunderstand the term “DevOps.” It is often considered just a job title when in reality, it is much more. Think of DevOps as a mindset and culture change within a company. The main goal is to automate and improve the software delivery process. This term is important for business leaders to understand because it can help them make their organizations more efficient and agile. – Øyvind Forsbak, Orient Software Development Corp.

6. Application Programming Interface

There’s confusion about the term “application programming interface,” more commonly referred to as an “API.” If software is taking over the world, and developers are the ones building software, then APIs are the tools developers are increasingly turning to in order to build software and innovative products, features and experiences more effectively and efficiently. – Gleb Polyakov, Nylas

7. Open Architecture

The concept of “open architecture” is a simple premise, but nontech people don’t fully grasp its importance. Open architecture is imperative for modern technologies and the key to next-generation digital experiences. By promoting agnostic relationships between technologies, open architecture is empowering broad platforms (such as Amazon or Netflix) and optimizing user experiences. – Michael Serbinis, League

8. Zero-Trust Security

The term “zero-trust security” is frequently used but often misunderstood. Simply put, zero trust is an important security model that requires organizations to not trust anything inside or outside their network. Instead, to operate on a zero-trust model, all access requests need to be granularly decided, monitored and tracked across an IT infrastructure. Don’t trust anyone; always verify. – David Canellos, Ericom Software

9. Security Versus Privacy

There’s confusion around the distinction between security and privacy. Security is the processes and technologies that allow you to protect data and compute in all of its phases (at rest, in flight and in use). Privacy is itself an outcome; it’s the notion of taking data and using security (both processes and technologies) to control who has access to it and what it is being used for. – Stephanie Domas, Intel

10. Cyber Risk Versus Cyberthreat

“Cyber risk” refers to the risk analysis of IT and digital systems and the ways to measure risk. The term is often confused with “cyberthreat.” A cyberthreat is an actual issue, such as phishing, breaches, malware and so on. We use cyber risk analysis to understand where we stand and what we will have to face in terms of risks; cyberthreats are part of those cyber risks. – Claudio Chifa, DLTCode

11. Technical Debt

Nontech executives often have a hard time grasping the concept of “technical debt.” Technical debt is mostly incurred when a misguided product requirement finds its way into product development; it’s when a feature is implemented without a meaningful amount of reasoning and a careful review of the “technical debt” associated with it. Technical debt might not break the bank, but it can literally break a product. – Burc Tanir, Prisync

12. Shared Services Organization

“Shared services organization” is a popular term that’s confused by many with “centralized services.” An SSO operates as a business with a defined set of services, and it provides them to internal or external customers. Centralized services, on the other hand, are an extension of an enterprise’s teams for certain functions. An SSO’s purpose is to control and reduce costs, and it responds to changing business needs by unifying the customer’s vision. – Spiros Liolis, Micro Focus

13. Artificial Intelligence

“Artificial intelligence” is a common technology term that is highly misunderstood these days. There are many analogous terms, including data science, predictive analytics, machine learning and others. Data science, or machine learning, helps with the data analytics and algorithms that make up AI systems. It is important to understand that data science today is used for predictive analytics and recommendation engines. – Swathi Young, TechNotch Solutions

14. Deep Learning

The key difference between “deep learning” versus other “learning” is that a deep learning system helps you discover the proper structure of the automation model. In other words, it helps to extract the knowledge on its own. These “thinking” systems don’t eliminate the role of data scientists; in fact, it’s just the opposite. They require highly skilled humans to glean everything from the data to make the model work. – Victor Shilo, EastBanc Technologies

15. Agile

Most business people still misunderstand Agile methodology and sprints as a way for tech teams to deliver results “tomorrow.” They expect these results without discussions on what the feature they are requesting is for, why it’s needed and how it will be used. In simple terms, Agile is a mindset that allows businesses to define a deliverable and the desired time frame, work more closely with IT teams, and define “done” (which means how they will test the feature). – Buyan Thyagarajan, Eigen X

16. Whatever The Latest Buzzword Is

There’s a common ground for misunderstandings by nontech people, and that’s the latest buzzwords. A current example is “blockchain.” It’s a great solution when you’re talking about security. But often, nontech people want it no matter what—even if we’re just talking about a three-page website with baked goods descriptions. Before jumping into a new trend based on the pros, review its cons to assess if it’s the best choice for you, not the rest of the world. – Nadya Knysh, a1qa