Bridge the gap between insight and action with advanced analytics
Organizations of every type and size face the same challenges as a result of the big data explosion. You need to be able to make accurate predictions based on the information you’ve gathered, and then transform those predictions into recommended actions that will benefit the business. But where do you start?
The synergy between predictive analytics and prescriptive analytics helps to bridge the gap between insight and action. Predictive analytics forecasts what might happen in the future based on what has happened in the past. Prescriptive analytics takes the process a step further by recommending or prescribing, what to do next based on those future insights. These recommendations help managers make decisions when the data environment is too large or complex to be understood without the help of technology.
Gartner projects that through 2015, predictive and prescriptive analytics will be incorporated into fewer than 25 percent of business analytics projects, but will deliver at least 50 percent of the business value (Gartner, Hype Cycle for Content and Social Analytics, August 2014). Learn more about this report in this blog post from Bob Palmer.
When you leverage both technologies for decision-making, you provide a more complete understanding of an event or action while balancing conflicting goals and trade-offs. For example, your organization may be able to improve:
- Price optimization: What price point and product mix combination results in revenue maximization?
- Portfolio optimization: How does transaction and trade management improve operational cost controls?
- Workforce scheduling: How can we schedule employees for critical tasks given multiple constraints, labor cost considerations and individual schedules?
- Logistics: What routes should be taken to balance cost considerations and incremental revenue opportunities?
- Marketing campaign optimization: How can I determine the specific actions or offers to which individuals will most likely respond?
The best way to get started is to select a meaningful problem (one that will have impact) and approach it on a scale small enough to deliver rapid results. Then, your organization can begin to expand its capabilities and put into place technologies and processes to support more complex analytics.
To learn more, check out this informational resource at IBM AnalyticsZone and join us for From Insight to Action: Predictive and Prescriptive Analytics from IBM at 11:00 a.m. ET on May 5, 2015.