Big Data, Data Science

Using Prescriptive Analytics to Make Better Decisions

Business Analytics is broken down into three distinct phases.

  1. Descriptive – What happened? This phase involves traditional BI tools to help organizations process and report on historical data. Trends are analyzed and decisions are made. The majority of management reporting uses this approach.
  2. Predictive – What will happen? This phase uses machine learning algorithms to build models from historical data and then uses those same models to predict a future outcome or its likelihood.
  3. Prescriptive – What action should be taken? This phase prescribes actions to achieve the best possible outcome based on the predictions made. Actions that lead to the highest chance of success are prescribed.

Prescriptive Analytics predicts and compares the likely outcomes of any number of actions, and then chooses the very best action to help advance an organization’s objectives.

Consider implications for the healthcare industry. Healthcare predictions are most useful when that knowledge prescribes clinical action for each predicted outcome.

Similar insights can help organizations improve decision making and have more control of business outcomes. Prescriptive analytics is an important next step on the path to insight-based actions and recommendations.

Data Science

6 steps to data mining awesomeness

Have a data mining project on the horizon?  These 6 steps make up the Cross Industry Standard Process for Data Mining (CRISP-DM) and will help make it awesome!  datamining

  1. Gain an understanding of the business problem you are trying to solve. Are the business requirements well defined?
  2. Get to know the data. What data is available? Is it complete? What data is needed?  Now is also a good time to identify any data quality problems. 
  3. Prepare the data. Data is rarely clean or in the right format for your modeling tools. This step can be time consuming.   
  4. Create your model(s).  – Pick your modeling tool and build your model – Linear Regression, Classification, Clustering. Several techniques can be used to solve the same data mining problem. Now might also be a good time to revisit Step 3 if the data isn’t quite right. 
  5. Evaluate your results.  Are the results meaningful? Do they solve the problem you identified in Step 1?  Ultimately, a decision on the use of the results should be made.
  6. Deploy your model!  How should the model be deployed? What steps should be taken to maximize the benefit of the model and results?

That’s it!

Do you use a different process? I’d love to hear about it. Please leave a comment.