Excelling by numbers

Ever wondered how psychics seem to ‘know’ quite a lot about their clients? I was watching one video the other day on You Tube. It was about one psychic who was predicting peoples’ futures. After watching it, I was very intrigued; not because of the fact that the people confirmed the predictions to be true afterwards, but because of the ‘method’ he used to make those predictions.

I likened the method to what is called predictive analytics, also known as advanced analytics.Predictive analytics is using new and historical data to forecast activity, behaviour and trends. It is just a matter of making great hypothesis by using algorithms combined with past events, situations etc. There are variables that can be measured and analysed to predict the behaviour of an individual, a group of people or how a product or service is going to perform in the market.
Some businesses have seen this to be the future solution to transcending through the margins of meeting market needs and saving the business from producing or rendering a service that may not be needed.

Let us look at a simple example. Let us say a gym has implemented a predictive analytic model for the business as a result of the fact that it is difficult to predict whether clients would renew and pay for their membership especially if they have the choice to suspend it for a period of time. By using the model, the system might predict that a certain individual(s) may not renew their membership. This prediction is due to the historical data and it gives the owner of the gym an idea of a possible loss in which a remedy can be formulated before the damage is done. For instance, an incentive may be offered to these particular individuals in an attempt to make them continue their membership, but not coercing them into it.

As a leader, you can also use this method to retain your staff. Let us say that there is an employee who is hardworking but is sort of ‘neglected’ (and most of the time not intentionally). They are given almost each and every problem to solve and it seems like the weight of the company is on their shoulders, but still they never disappoint to deliver. They seem loyal and there is nothing suggesting that they are looking for a different job, except their CV shows that they have never worked for more than two years in any one of the companies they have worked for previously.

The particular employee has been with the current employer for three years now and has recently started to further his studies. With this trend, a predictive model can predict the outcome from this particular situation and give HR enough time to react accordingly. This can save businesses on losing very essential resources. Have the ability to anticipate and drive better business outcomes. Become a decisive competitive factor in your industry.