When people ask me what I do and I say, “Predictive analytics,” the usual response is a blank stare and a quick change of subject. Why people are so intimidated by those words is surprising given that EVERYONE performs predictive analytics on a regular basis in their personal lives without the scientific structure.
An example of everyday analytics:
Last month, I had a dinner party. I carefully planned the menu and made my store list for all the ingredients I need for the fancy meal. Then started a careful analysis in my mind. The question was, “What store do I need to go to in order to find everything on my list?” My nearby Safeway is so close and never crowded, yet every time (100%) I go with a recipe list, at least 2 key ingredients are not there. So is it worth going further down the road to Balduccis, where 8 out of 10 (80%) times I find everything but its further, more crowded and costs a lot more even with coupons? Or, should I really make an effort and go to Whole Foods, where I’m 99% sure to find everything I need, but it’s even further, parking is a huge hassle and it will cost more than Safeway and as much as Balduccis? Or, worst of all, should I go to more than one store at considerable time expense and cost (time is money)! I mull all these variables and past experiences over in my head to help me decide where to shop – using past experience (data) to predict the future likelihood of a successful shopping experience. I define “successful” as procuring all ingredients on my list in the shortest amount of time for the least amount of money.
How does this relate to association professionals? Predictive analytics in the association world is no different. Information from the past (data) helps us make better business decisions.
Decisions need to be made every day. How many to order? What content goes on the website? Which members should we contact and remind to renew? Which marketing program should we pursue? We need to draw upon information from the past (data), to help make a better decisions in the future. In association business, our decisions could cost (or save) tens of thousands of dollars – in some cases much more than that. We cannot simply rely on our mental decision-making techniques. It’s imperative that science is applied to help us not only make the decision, but also to support these decisions empirically. Thankfully, Statistics and Decision Analysis is the science that provides that structure. The time is now for analytics to become part of our everyday association decision-making process.