Next Best Action: Prescriptive Analytics

For innovative businesses who are serious about taking their business intelligence and data and insights strategy to a new level, prescriptive analytics is a powerful tool.

Where descriptive analytics asked, "what has happened?" and predictive analytics asked, "what could happen? ", you're now striving to understand "what should you do?"

Predictive analytics signals future trends, prescriptive gives insight for how we can harness these trends and turn them into opportunity. Prescriptive analytics focuses on finding the best course of action for a given situation. This analytics branch is all about advice.

Let’s break down the impact of prescriptive analytics with an example case study. Let’s say you are a CEO of a train service and you are needing to sell tickets while developing the most efficient systems and processes to do so. Prescriptive analytics will allow you to automate ticket prices and promotions in real-time, based upon many variables. These could include volume available, time of the year, situational demand and time left to the ticket expires. The result is, an automated and efficient system for pricing, maximising value for the organisation.

In short, it gives organisations the ability to take relevant data and use it to anticipate and improve decisions to make your actions more effective and impactful. Although a newly emerging field in its application to business, the impact it is having is significant and constantly evolving. When looking to implement prescriptive analytics capabilities to your organisations wider big data strategy, the goal is to be able to be ready to address specific situations like reduced sales or a product launch that doesn't go as planned. This is done by factoring in available resources, knowledge of possible situations, what is currently happening with your business and past performance.

Some additional examples of relevant applications and real business impact prescriptive analytics can have include;

  • Create More Customer Loyalty- When you adequately meet your clients' needs by anticipating what they may need or want and adjusting your products or service accordingly with personalization, this can strengthen loyalty to your business or brand.
  • Increase Efficiency – Analytics and business intelligence will give you numbers based insight into areas you can develop efficiencies throughout the organisation. Roadmaps and initiatives can then be built to achieve this and track over time, impacting the bottom line.
  • Increase Productivity - Your team will be able to clearly define their goals to work towards, but more importantly anticipating changes in priorities and planning.
  • Limit Risks- Prescriptive analytics allow you to limit the risks you take while maximising your company's payoffs, by accurately looking at your predictions and making informed business decisions.
  • Meet Goals- Since you've already compiled historical data and you know what could happen, you can use this information to make the best decision to help your company meet your goals. These could be sales goals, customer retention goals or cost-cutting goals.

Prescriptive analytics is an exciting and emerging practice in the big data analytics space. While it sits at the advanced end of the data journey, having a line of sight for how this can impact your business is important.

SolveBI focuses on helping organisations build their data journey starting with data consulting and business intelligence, data visualisations, big data strategy and analytics. We help organisations big and small, at all levels of their data and business intelligence lifecycle and maturity.

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