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Aug 14, 2013

A Hunch is Not Enough: Why Your Company Needs Predictive Analytics Today!

Author: Alexandra Stanculescu

In today’s complex and turbulent business environment, it’s became more critical than ever to rely on business intelligence tools in order to forecast future probabilities. Making decisions based on actual data within your organization, rather than on average statistics, is probably today’s more awe-inducing competitive advantage. This article reviews the main benefits driven from predictive analytics tools, and looks at the business areas they’re meant to have the most powerful impact on. Basically, predictive analytics uses mathematical models to define patterns of behavior for customers, products and partners, based on current data available within a company – which would otherwise just be piling up on your company’s hard-drives, unleveraged.

Sales and Advertising

Predictive analytics can help your sales team optimize the time spent on closing sales. If you have to deal with large databases and find it hard to determine which lead to pursue and which to drop, then it’s sure that predictive analytics could increase sales by sorting the most promising leads out of the box. Predictive analytics can help sales consultants identify whom to target, how and when to reach them, and what messages they’d best respond to.

Business Strategy

Decision-making is tough – especially when you feel in-the-dark in the ever-changing environment, and it’s as though some of today’s truths become obsolete by tomorrow. If you’re a manager using predictive analytics, it’s more likely that your decisions rely on structured, comprehensive data. You will be able to correlate data, to better monitor progress and KPIs, and to achieve improved collaboration. You gain the ability to optimize and automate your decisions in order to meet defined business goals.

Risk-control and Loss-prevention

Having the possibility to anticipate future trends can help you prevent losses. Anticipating events will help you take the right course of action in advance, while reducing the costs of unfortunate, hunch-based business decisions. BI will allow you to avoid fruitless paths, and concentrate on those most likely to succeed. Of course, this will ultimately improve ROI.

As a recent study confirms, companies that invest in predictive analytics perform better, in terms of sales and profitability, than those who don’t. Even though, in their early days, predictive analytics tools were hard to use for non-IT personnel, nowadays this technology is far friendlier, and has become a less-than-one-hour-training tool for sales and marketing people.

Data is not Information. Data is just volume, while Information you can actually use. There are a number of business intelligence software solutions that can turn huge amounts of corporate data, from various sources, into Information, into useful insights. However, such solutions are usually quite pricey, so a CEO’s or CFO’s first thought would be „why would I invest in BI, and fix something that doesn’t feel broken?”. The answer is, of course, Because your competitors are already looking into it – and while business as usual is running steadily, this significant competitive advantage is one you might consider implementing before they do. But we’ve all heard so many related anti-success stories, with so many of BI implementations ending-up performing less than as advertised. Aren’t there ways of making sure you get the most out of your investment? Subscribe to our feed to stay in touch, because we’ll be exploring the steps to BI-implementation-success in future articles.

Until we meet again, we’d love to hear your thoughts and stories – has your company or an organization you know about implemented a BI tool? What were the results? What are the company profiles you’d think best suited to benefit from the power of BI? We welcome any information exchange, so share your experiences and business legends in the comment section below, or join us for a more private e-chat.

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