“To help shape the future of the organization and get improved value outcomes from their decision making, data and analytics leaders must know when and how to combine predictive and prescriptive analytics to gain a competitive advantage,” opens the Gartner® report ‘Combine Predictive and Prescriptive Analytics for Better Decision Making’.
In other words, the future will not be won by those who know what will likely happen. It’ll be won by those who know what to do about it.
Clarity In Vision
The report’s strength is how it goes back to basics. While the concept of bringing together predictive and prescriptive analytics is nothing new, these terms have blurred over time and become almost interchangeable. This report tells us why it’s important to pay attention to the differences as we face down our current challenges.
Our complex and uncertain world cannot be neatly summarized by a single variable, technique or methodology. Certainly, we can no longer rely on outdated Business Intelligence tools applying only descriptive and diagnostic analytics. We need a purpose-built problem-solving AI-driven toolkit that applies both predictive and prescriptive analytics so people can have a quick overview of a situation before taking action.
Clarity In Clear Actions
And yes, it’s all about taking action. If you think about it, predicting a problem is a very different value proposition than something telling you what to do about a problem. And this is especially true for a world with a chronic shortage of people with the skills to do the actual work society depends on.
You’re not going to make friends by pointing out an issue and then saying “Good luck with that”. The problem will likely then just be ignored because there are more immediate fires that need putting out.
The action people should be taking is to solve the problem, not just figuring out what the problem is. In this way, prescriptive solutions allow experts to be experts and solve the problem they are experts in solving – without having to become data experts.
With prescriptive, you get rid of all the noise so your workforce can focus on what’s important: fixing the stuff that needs fixing asap.
Price Versus Value
But we also all know that cash is king and prescriptive solutions almost always have a higher price tag than lower value solutions. But when you look deeper, the math changes everything when you factor in the costs associated with production loss and the gains from avoiding downtime, waste and overtime – along with how you can manage your spare parts and logistics. Prescriptive solutions pay for themselves over and over again.
Certainly, once you’ve seen prescriptive in action, there’s no turning back. The value is obvious. I still need to hear the conversation: “Hey, let’s downgrade here to this cheaper predictive solution.”
Why fight progress?
Predicting The End Of Prediction
The report presents one case study that bypasses predictive altogether.
By deploying prescriptive analytics in the form of an optimization model, a global snack-food manufacturer was able to consider multiple variables – “including various chip size, bag size, fryer speeds, temperatures, seasoning loop capacity, the cost of input resources and cost of shipping” – to find the best way to allocate their produced chips to multiple distribution centres.
As a result, the company enjoyed a $300,000 per week reduction in cost.
And these are the sort of numbers that make sense to anyone.
All About Trust
However, whatever prescriptive solutions you go for, you need to trust the people who provide it.
As with doctors, you’re only going to take their advice – and prescription – if you trust their expertise. Conversely, I am not going to trust the recommendations of a shopping platform, if I don’t trust that the company is truly out for my better interests. (Notice, I’m not naming any names here.)
And the same is true for the SaaS world: prescriptive only works when people trust you.
And here lies the secret of Augury’s success. We’ve been able to provide predictive insights to drive prescriptive actions – that eliminate unnecessary downtime, increase capacity and yield, optimize asset care, and reduce waste, loss and emissions – with a 99% success rate.
Just ask our 100+ manufacturing companies who have partnered with us. They already know they can’t rely on purely predictive ever again.
That ship has sailed.
Read the full report ‘Combine Predictive and Prescriptive Analytics for Better Decision Making’.
To learn more about how Augury combines predictive and prescriptive insights in keeping manufacturing machines at their best, reach out.