This word has become common in the current business vernacular. I and my business colleagues refer to algorithms frequently. Would you know an algorithm if it slapped you? You (we) should as our lives are being shaped by them.
An algorithm is an effective method that can be expressed within a finite amount of space and time and in a well-defined formal language for calculating a function. Starting from an initial state and initial input (perhaps empty), the instructions describe a computation that, when executed, proceeds through a finite number of well-defined successive states, eventually producing “output” and terminating at a final ending state. The transition from one state to the next is not necessarily deterministic; some algorithms, known as randomized algorithms, incorporate random input.