ICM stands for the Independent Chip Model.

This is the model that defines the monetary value of the tournament chips of an individual player (or their equity). To put it simply, it converts chips to dollars. This conversion is not straightforward because it depends on the tournament payout structure, and in different tournaments, the same stack sizes may represent a different amount of dollars.

ICM algorithm takes stacks of the remaining players and the tournament payouts and calculates the equity of each stack. To do that, it calculates the probability to finish on each potential position of each player and sums up the equities of finishing at each position to get the total equity of the certain player.

We are interested in the ICM algorithm only in the context of a Poker tournament.

Read this article to learn more about ICM.