You make certain predictions about the world based on your past experiences. You expect the sun will rise, your coffee will be hot, and your toothpaste will taste nice and minty. These expectations are the sum of the data you’ve collected every morning of your life, built into a mental model that you now probably take for granted.
Predictive analysis works on a similar principle, but on the kind of scale possible only with technology. Predictive models use existing data and information to create advanced statistical algorithms that can extrapolate values for new or different data, giving you probabilistic insight into the information you feed it.
Those insights can help your organization make better decisions, increase operational efficiency, and even minimize risks. Here’s how.
Predictive Analysis Looks Ahead by First Looking at Your Data
In today’s environment, it’s easier than ever to collect data about your business, your operations, and your customers. But turning that raw information into something actionable is still difficult.
Predictive analysis makes sense of your data and uses it to solve problems while identifying new opportunities. Here are just a few ways businesses have put it to use:
- Providing Better Customer Service
Predictive analysis can help you make sense of customer behavior and watch trends unfold. It can even give more focus to your marketing efforts by predicting which of your potential customers are most likely to wield their purchasing power (and which of your existing customers are likely to wield it again).
- Reducing Risk and Detecting Fraud
Risk can come in many forms, like a customer with questionable credit or a bad actor attempting to commit fraud. Predictive analysis can help businesses identify these and other problems before they happen.
- Improving Efficiency
When you’re in the thick of the work day, spotting inefficiencies within your own business can be difficult. Predictive analysis is like having a fresh set of eyes to improve your operations and processes.
Industry Benefits of Predictive Analysis
Predictive analysis is such a powerful tool because it’s extremely versatile. Which is also why you can find it at work in every sector you can think of. Here are a few examples of how different sectors put this technology to work.
- State Government
Every state sits on a vast treasure trove of data. For that data to be useful and serve citizens, each state government has to be able to analyze all that information to identify trends and changes throughout the population at large. While this may seem like a tall order to many agencies, it is an achievable and realistic goal.
- Health Care
From detecting and preventing fraud to identifying patients at the greatest risk for chronic disease and facilitating scheduling, predictive analysis tools offer ways to help make health care more effective and efficient. Investing in proactive care is always great for communities and the healthcare organizations serving them.
- Business
For the financial industry, predictive analysis enables safer and more profitable investments. In manufacturing, predictive analysis can help reduce production failures and optimize operations. Data-backed predictions can work wonders for any revenue stream.
It’s no exaggeration to say that every industry can benefit from risk reduction and increased efficiency. The applications of predictive analysis are far-reaching across every sector. And with the right partner by your side, getting started is easy.
We help organizations drive growth through data analytics. Here’s how.
