Predictive Analytics For Dummies, 2nd Edition

Chapter 1

Entering the Arena

IN THIS CHAPTER

Explaining the building blocks

Probing capabilities

Surveying the market

Predictive analytics is a bright light bulb powered by your data.

You can never have too much insight. The more you see, the better the decisions you make — and you never want to be in the dark. You want to see what lies ahead, preferably before others do. It's like playing the game “Let's Make a Deal” where you have to choose the door with the hidden prize. Which door do you choose? Door 1, Door 2, or Door 3? They all look the same, so it's just your best guess — your choice depends on you and your luck. But what if you had an edge — the ability to see through the keyhole? Predictive analytics can give you that edge.

Exploring Predictive Analytics

What would you do in a world where you know how likely you are to end up marrying your college roommate? Where you can predict what profession will best suit you? Where you can predict the best city and country for you to live in?

In short, imagine a world where you can maximize the potential of every moment of your life. Such a life would be productive, efficient, and powerful. You will (in effect) have superpowers — and a lot more spare time. Well, such a world may seem a little boring to people who like to take uncalculated risks, but not to a profit-generating organization. Organizations spend millions of dollars managing risk. And if there is something out there that helps them manage their risk, optimize their ...