There’s always a new technology on the horizon – something that is supposed to revolutionize the entire business world.
But rarely do these technologies live up to the hype. Predictive technology is another technology that’s being discussed with considerable excitement, but what makes it different?
What is Predictive Technology?
If you’re unfamiliar with predictive technology, it’s pretty much exactly what the name implies. Or as marketing expert Peter Mollins puts it, “Predictive technology consumes data about past behavior of companies and people. It correlates these indicators, or signals, with attributes of a prospect. It then makes predictions about what these prospects will do in the future based on what prospects in similar situations did.”
Predictive technology is nothing more than software and algorithms that use past data to predict future events. And while that sounds really simple, there’s a lot of complicated technology and legwork that goes into creating these powerful systems that have the potential to produce billions of dollars in revenue for strategic, forward-thinking businesses.
“I strongly believe every company will be using predictive to drive growth within the next ten years,” says Vik Singh, CEO and co-founder of Infer. “It just doesn’t make sense not to, when we can get a company up and running in a week, show them the ROI value via simulations, and only then ask them to pay for it.”
Singh speaks to a larger point that has been rather significant over the past couple of years. While the science is improving, predictive technology has been hindered by a lack of understanding and familiarity on the consumer side. Once businesses are able to set aside their preconceived notions about what predictive technology can do, there will be room for this industry to explode.
How Businesses Can Prepare for Predictive Tech
From a business perspective, how can your organization prepare for the impending growth of predictive technology? You can start by doing the following three things:
- Adopt New Tools
Not all predictive technology will be created equal. As you look for opportunities to align your business with predictive technology, ensure you’re pursuing the right tools and solutions. The last thing you want is get stuck on the wrong side of things.
- Partner With the Right Human Capital
“Statisticians and research analysts will no longer be the sole property of academic institutions and think tanks,” expert Ellen Valentine tells businesses. “Make headcount plans for hires who can use new solutions to not only gain insight from what’s happened in the past, but to also uncover issues before they become a problem or discover amazing opportunities to capture revenue and market share.”
Valentine is speaking to a particularly important point. Predictive technology cannot thrive on its own and you will need people in your organization who can harness the power of the tools you adopt.
- Take Proactive Approach to Data
While there will be a tendency for some organizations to sit back on the sidelines and wait to see how predictive technology plays out over the next few years before getting involved, don’t do this. The early bird will get the worm. Take a proactive approach to data and you will be rewarded. It won’t be easy, but the sooner you get involved, the more knowledge and experience you’ll gain for future endeavors.
- Look Beyond the Numbers
Predictive technology isn’t just about collecting information and making decisions about how to best proceed in the future. You should be gathering data with the purpose of engaging customers. Sure, data offers the enticing promise of growing your business, but you have first use it to better your customers. Only then can you enjoy the business-side benefits.
- Understand the Limitations
Predictive technology isn’t some all encompassing solution to every pressing business need. It has limitations and company leaders must understand this from the start.
“Predictive analytics mainly uses historical information, which can lead to limitations,” consultant Erik Sherman explains. “Many strategic decisions concerning new markets, product types, or practices may not profit as much from this retrospective analysis.”
This ties back to point number two and reemphasizes the need for intelligent human judgement to interpret results.
Looking Towards the Future
We’re not saying that now is the time for your company to invest thousands of dollars into predictive technology, but we are telling you to get ready. There’s about to be an explosion of growth in this tech sector and you don’t want your organization to be the one left on the outside looking in.
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