Prescriptive analytics provides companies with recommendations about optimal actions to achieve business objectives such as operational efficiency, customer experience and profits. Prescriptive analytics solutions use optimization technology to solve complex decisions with millions of decision variables, constraints and tradeoffs. Organisations across multiple industries are using prescriptive analytics for a range of applications spanning strategic planning, tactical and operational activities.
Through prescriptive analytics we can:
How does it work?
Prescriptive analytics is based on all the knowledge and techniques of descriptive and predictive analytics (classification, prediction and segmentation) and from fields such as operational research and numerical optimization. Often, a prescriptive system collects business information to predict what impact certain policies or actions will have in the company and possibly in the community, and chooses the action with the highest return on investment through an optimization process.
Each business is different and, therefore, there is no general prescriptive analytical solution for all. That is why the design of any prescriptive system starts with a consultancy process, in which 202data works with the client to build a system with every information related to the business such as costs, policies or HR, designing a smart system of constant optimization and self improvement through machine learning techniques, that is capable of finding the best action for each moment, each time better.
It is also possible to introduce in the system different options to define the risk-benefit balance in which it is preferred to operate at a given time.
Once the prescriptive system is deployed, it constantly feeds the business with data (sales, stock levels, performance metrics, etc.) to recalculate their schedules and execute them automatically or under the review of an expert.
Overall, the system allows you to improve the ROI of the business directly through your decisions, and indirectly by reducing costs in planning processes.
Scientific disciplines that comprise prescriptive analytics
Benefits of prescriptive analytics
Prescriptive Analytics will not just improve fragmented business functions but the entire enterprise. Some benefits of prescriptive analytics include optimization of product planning, reduction of inefficiencies such as energy overuse, smarter operational decision-making, better resource management such as personnel, equipment, vehicles, facilities and capital, and risk mitigation through data insights.