You might have heard this in various forums; or from technology consultants; the use of predictive analytics can effectively change marketing plan, make it more effective, bring more customers and revenue, more profit and increased bottom line. And the moment the benefits are mentioned, everyone is interested; is it not? Well here in this blog post on predictive analytics, let us try to get a better picture of predictive analytics. Better picture of what is it, what it will do, and how you can handle it for your marketing, sales, company direction and related other activities.
Predictive analytics is part of data mining. In data mining we know that we bring out the concealed or hidden value of the data. Correct? Well, this result is directed to tell in advance what will happen, and what the probabilities of that happening are, and what the pattern is. Prediction is the core element. A common definition given to predictive analytics is that is “it is a process of statistical analysis used to determine the future pattern, behavior pattern and trend by using data mining techniques”. Just a typical example for this can be, an Insurance company forecasting a higher risk level based on the age or disease type of insurer. In this predictive modeling process, the data of the insurer is collected, analyzed with the other data of average age and other parameters, a formulation is done.
There are many uses for predictive analytics. Also, it is applied in many areas. It can be applied in societies, organizations, governments, enterprises and individually, too. Always, enterprises are under pressure, more so in today’s competitive market place, to predict what is going to be their future, their competitor’s future and their customer’s future.
Use case of predictive analytics
Let us see only one of the use cases in this post. In this use case pertaining to health care industry, a hospital in USA uses a predictive analytics tool. The tool used is IBM SPSS Predictive Analytics software. SPSS is one of the leading predictive analytics software suppliers; recently acquired by IBM. With this acquisition IBM has integrated SPSS with it DB2 Data ware housing solutions. The hospital mentioned uses SPSS Predictive Analytics for many years now. While there is more than one benefit out of using it, we describe two benefits here.
Use of predictive analytics for patient’s benefit: This hospital does cardiac surgeries and holds best record for survival after valve replacement. The hospital attributes to the data base driven approach combined with the expertise of it. For example in the cardiac surgery to the patients, it uses predictive analytics to decide who or which physician should perform the surgery. This has resulted in huge benefits to the patients.
The same hospital uses predictive analytics to determine the process of claim processing. In the medical claim process, some Insurance companies offer bonus payment to physician’s performance. Even within an Insurance company, depending on various factors including medical condition of the patient, which state he/she belongs to, insurance product and its rules, the claim processing is affected. By getting inputs from data from the physician, predictive analytics process is used to suggest and initiate the claim process.
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- Malick Md
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