Prescriptive analytics is the next step up from predictive analytics. Predictive analytics can tell you what is likely to happen, while prescriptive analytics can tell you what you should do to achieve your desired outcome.
Prescriptive analytics is all about optimization. It looks at all the options available to you and finds the best possible solution based on your specific goals. It can help you make better decisions, faster. Take a look at an example of prescriptive analytics to get a better idea of the differences between it and other methods like descriptive analytics and predictive analytics. Here are some of the main ways you can take advantage of this technology to gain actionable insights into your business processes and how to improve them.
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Understand the prescriptive analytics process.
You don’t have to be a data scientist to understand the basics of machine learning algorithms or prescriptive analysis, which is great, because to fully take advantage of prescriptive models using real-time data for business intelligence, you’ll need to know a bit about the overall process. Here are the basic steps you’ll need to know to have a successful digital journey.
- Identify your goal: The first step is to identify the goal you want to achieve. This could be anything from increasing profits to reducing costs or improving customer satisfaction. The goal could also be to increase profits, reduce costs, or improve some other metric.
- Analyze the data: The next step is to analyze all the data you have available. This includes data from internal systems and data from external sources, such as market reports.
- Choose the best course of action: The final step is to choose the best course of action based on the data you’ve analyzed. This could involve using predictive analytics to identify the best possible solution or using simulation to test different scenarios.
Identify use cases for prescriptive analytics models.
Prescriptive analytics is a form of advanced analytics that uses artificial intelligence (AI) and machine learning (ML) to provide insights and recommendations on how to take specific actions to improve business outcomes. It can provide recommendations on what actions to take to achieve specific goals, optimize business processes, and improve decision-making.
Prescriptive analytics is particularly useful for businesses that want to improve performance by taking specific actions to achieve specific goals. It can help identify and recommend the most effective actions to improve outcomes, such as increasing profits, reducing costs, or improving customer satisfaction.
Important use cases for prescriptive analytics include improving sales and overall market performance, optimizing your supply chain and logistics, improving customer service with customer relationship management, enhancing new product designs, minimizing risk and vulnerability, and much more.
Understand the data requirements for prescriptive analytics.
In order to fully take advantage of any type of data analytics, it’s important to understand the different types of data you’ll need and how prescriptive analytics software uses it.
Historical data is the most important data for prescriptive analytics. This data is used to train the model and determine what is most likely to happen. It’s important to have a good understanding of the data and how it will be used. The data should be clean and accurate so that the model can produce accurate results.
Current data is also important for prescriptive analytics. This data is used to determine the current state of the system and what actions are possible. The data should be accurate and current so that the model can make accurate predictions.
Simulation data is also important for prescriptive analytics. Historical and current data are essentially combined so that the prescriptive analytics application can test it against possible real-world scenarios and determine how they will play out. This helps you determine the best course of action for whatever problem you’re facing.
Prescriptive analytics is a powerful tool that can help businesses achieve their goals. By following the tips outlined above, you can start to take advantage of it and meet business goals.
