Descriptive, Predictive & Prescriptive Analytics will fail to Help You Understand Your Business
It has been a practice followed religiously by companies and organizations to analyze how they have performed over a period of time. It is mandatory for them to do so; just that some do it to survive and some do it to thrive in concurrent market dynamics. If we look at the history of big data, it has been a common practice for all; trying to understand how the world and various businesses, completely resting on the analysis of first hand data available. This is to an extent that people in the business define their careers progression as BBD and ABD; before big data and after big data.
Few years back, it was like looking at the crystal ball the wizard would describe what all happened in the past with your business. Today it is called descriptive analysis. With advent in data technology and understanding about BIG data walking in, brought along answers to questions like what is going to happen to my business in future, called the predictive analysis.
The times have changed and so have changed the market dynamics and world economies, which are more colorful than rainbows. This has compelled organizations across the globe to resort to the final stage of analytics, the prescriptive analytics which is all about “so what”, “why not”, etc. All other analytics were able to provide insights to businesses about what their customers buy, when and where. But with Prescriptive analytics is what makes them understand “why”.
Today every business is subjected to new expectations, competitors, channels, threats and opportunities. Organizational leaders and C-suites across the globe, from largest companies; have clearly understood that in order to boost revenues, increase profitability and build customer loyalty, they are required to make decisions with an understanding of customer actions, attitudes and opinions. The required complete insight is something that descriptive, predictive & prescriptive analytics can help them with, if adapted and adopted while taking to important aspects into considerations.
One of them is that all these three types of analytics should co-exist; as one is not better than and without the other. If you are aware of the basics of data analytics; you would agree that though all three of them are more consecutive, they contribute to the objective of improved decision making. The second but more important an aspect, which needs to be paid utmost attention to, is something that we will discuss towards the end of this article.
Know the past of your business through descriptive analytics
The term past here refers to timeline from 1 minute to a certain number of years back then. Such analytics mainly assist in comprehending the relationship between your products and your customers; where the main purpose of this assessment is to finalize the futuristic approach. It is kind of learning from past behavior to influence futuristic outcomes.
To be candid, this type of analytic should not come to you as a surprise. You and others in your capacity have been using it more or less in form of reports that give you better insight into finances, operations, customer preferences and sales etc. Descriptive analysis has played a vital role in determining what to do next, by transforming data to information to conclude the future outcome of acts and events.
Know the future of your business through predictive analytics
This type of analytic is effective and useful in providing businesses with actionable insights based on data; yes remember this. Data mining, data modeling, game theory, machine learning etc.
