Predictive analytics is the prerequisite for generating insight from data.
Simply put, predictive analytics is what allows us to extract value from raw data. It does not matter what size the data set is. It is a type of advanced analytics that allows us to make predictions.
You always hear that Big Data is the new competitive advantage and the new oil. Well, this isn’t exactly true. Because raw data is just that…raw data. It’s when the data is analyzed that it becomes so valuable. By analyzing the data, you can discover inefficiencies, learn more about your customers, and even help break down the barriers of silos.
I now knew how my father felt when I tried to explain the first iPhone to him.
Me: “It is a phone, and an iPod, with a touch-screen, and it has these things called apps.”
Dad: “So do I have to hold my ear up to it to listen to music?”
Me: “No, Dad, you just plug headphones in it, like a normal iPod.”
Dad: “Oh no, I just touched something, and I don’t know where it took me. What button do I press to go back…wait there’s only one button? So what do I do with this?”
The original iPhone, valued at $499, was worthless to my Dad. He couldn’t use the thing.
It is the exact same situation with data. Although it is clearly valuable, it is essentially worthless unless you know how to use it.
Therefore, I see it as predictive analytics is what adds value to data. It is also what can help you make money using data.