Maturing Data Analytics… Starting with the Customers

I’m going to be blunt, most people don’t know what kind of analytics they want. It’s not uncommon for a data analyst to come across a customer believing they have a use case for “Predictive Analytics” when really what they’re asking for is “Diagnostic Analytics.” For example, a simple indicator that will flag the projects they own when they are approaching their budget or going to go over. Is this Predictive or Diagnostic analytics? If we are going by the definition of the word “Predictive”, you probably would guess that because it will be ‘saying that something will happen in the future.’ However, the mere act of alerting is only answering the question, “Where do we look amongst the numerous projects?” Thus, for deciphering the type of analytics it is, I’d argue that its Diagnostic. Some would even venture to say that it’s AI if we implement an automated email alert feature with no human interaction. Which brings me to another common misconception, the buzz word ‘AI’ means Artificial Intelligence, but in reality, most people are thinking of Automated Intelligence. The automation piece can easily be handled by some simple programming script and isn’t an actual method of AI. Once the data analyst makes these clarifications, the customer realizes there is a lot more work to be done to identify valid applications of machine learning and Predictive analytics for their request. Which most often than not includes providing use cases that aren’t available yet without extensive interviews on what truly causes a project to go over budget… but that’s another story.

 

It is possible to include all the analytics mentioned above by restructuring the statement a little. Such as, “by monitoring supplier delivery (from internal and external sources), staffing capacity, and type of project, we can better predict a Forecast and automate alerts for projects threatening to go over budget.” That statement is a much more formal customer request that shows the need for Predictive analytics due to previous issues in supplier delivery and staffing capacity having an adverse effect for budget constraints on certain types of projects. The misconception I’m trying to convey with the previous example is that advanced analytics like; Predictive, AI, and even Forecasting, requires that the customer knows what questions they are trying to answer. Otherwise, we have to shape the demand. To better show the relationship of the type of analytics and issues it answers, I’ve illustrated my attempt of an analytics maturity map that may prove useful to other data analysts or their customers. I’ve also included some common types of algorithms/methods used to generate the insights at those stages.

Analytics Maturity MapPrint REV 2.2.png

You’ll notice a big difference between my maturity map and others you can find on the internet is that mine is circular. I find that the other sources tend to portray the different types of analytics as a linear progression and as mutually exclusive entities. In my opinion, the various kinds of analytics are subsets of one another. It shows that if you aim to have Prescriptive analytics, you can also be Predicting, Forecasting, and using Descriptive analytics all at the same time, something not possible in a mutually exclusive model. Also, the algorithms/methods used in each group can work for its subcomponents. You might argue that by the definition of a ‘subset’, all Diagnostic Analytics are also Predictive, I think that’s true because the potential is always there for each use case, whether you’ve enabled that capability yet is up to you.


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