connecting data and experience: how decision management works

Grab some coffee and enjoy the pre-show banter before the top of the hour!

H T  Technologies    of   2014  

HOST:  Eric  Kavanagh  

     THIS  YEAR  is…  

Decision  Management      

�  Data  is  not  enough  &  experience  is  not  enough  

�  Understanding  trends  is  nice  –  predicting  them  is  better  

�  Business  performance  ultimately  drives  decisions  

ANALYST:  

Rick  Sherman  Founder,    Athena  IT  Solutions    

ANALYST:  

Wayne  Eckerson  President,    Eckerson  Group  

GUEST:  

David  Ross  Senior  Director  of  Product  Management,    FICO  TH

E  LINE  UP  

INTRODUCING  

Rick  Sherman  

Rick  Sherman  Athena  IT  Solu4ons  rsherman@athena-­‐solu4ons.com    

Copyright © 2014 Athena IT Solutions

Hot  Technologies  of  2014:  Connec4ng  Data  &  Experience:  

How  Decision  Management  Works  

Slide 9 Copyright © 2014 Athena IT Solutions All rights reserved.

From Descriptive to Prescriptive Analytics Right Skills, Right Job

•  Data Scientists ü Very skilled ü Misunderstood & isolated

•  Business analysts ü Not stats, biz, eco or psych gurus ü Model consumers

•  Predictive Modeling ü  Too labor intensive ü  Self-service is misguided goal

•  Data Exploration & Preparation ü  Big Data - Too Much Labor ü Data Integration - Silos

Slide 10 Copyright © 2014 Athena IT Solutions All rights reserved.

From Descriptive to Prescriptive Analytics Right Architecture, Right Tools

Analytical Hub & Predictive Analytics Platform

Data scientists “in charge”

Objectives: •  Self-service BI •  Improved time to market •  Reusable & Embedded •  Revisions

Functional layers: •  BI Portfolio •  (Self-Service) Data Integration

ü  BI schema ü  Ent Apps & External

•  Predictive analytics ü  Modeling & Statistical Tools ü  Data Visualization ü  Development Platform

Slide 11 Copyright © 2014 Athena IT Solutions All rights reserved.

From Descriptive to Prescriptive Analytics Right team, Right Approach

Project Life-Cycle & Project Team

Slide 12 Copyright © 2014 Athena IT Solutions All rights reserved.

From Descriptive to Prescriptive Analytics Next Steps

INTRODUCING  

Wayne  Eckerson  

©  Eckerson  Group  LLC  

Bus

ines

s Va

lue

High

2010-20

Reporting

1980’s

Analysis

Prediction (Prescription)

Monitoring

Query, Excel, OLAP, Visual Discovery

Dashboards, scorecards

Statistics, data mining, optimization Static & interactive

reports

“What happened?”

“Why did it happen?”

“What’s happening?”

“What will happen?”

Low

= Reporting

= Analysis

1990’s 2000’s

All

user

s B

usin

ess

anal

ysts

Exe

cs, M

grs,

W

orke

rs

Sta

tistic

ians

/D

ata

Sci

entis

ts

Tools

Use

rs

Waves  of  BI  

©  Eckerson  Group  LLC  15

Two  Strains  of  Analy4cs  Exploration & Analysis Prediction & Optimization

Navigate historical data Model historical data

Deductive

Business analysts

Ad hoc and viz tools

Inductive

Data scientists

Data mining tools

©  Eckerson  Group  LLC  16

Predic4ve  Modeling  Steps  13%

18%

25%

23%

12%

9%

8%

1. Project definition

2. Data exploration

3. Data preparation

4. Model creation

5. Scoring and deployment

6. Model management

Other

Based  on  166  responses,  Wayne  Eckerson,  “Predic6ve  Analy6cs:  Extending  the  Value  of  Your  DW  Investment,”  TDWI  Research,  2007.  

©  Eckerson  Group  LLC  

Workflow  1.  Select  a  func6on  2.  Load  data  3.  Hit  Run    

Self-­‐service  predic4ve  analy4cs?  

Business  analysts  

Value    1.  Put  power  in  more  hands  2.  Prototyping  3.  Deliver  “good  enough”  results    

INTRODUCING  

David  Ross  

© 2014 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent.

From Descriptive to Prescriptive: Evolving Your BI Strategy

David Ross Senior Director, Product Management FICO

© 2014 Fair Isaac Corporation. Confidential. 20 © 2014 Fair Isaac Corporation. Confidential.

Moving from

Insights to

Tangible Solutions

© 2014 Fair Isaac Corporation. Confidential. 21

Maturing from Descriptive to Prescriptive Analytics

Business Intelligence

Descriptive Analytics

Predictive Analytics

Prescriptive Analytics

Summarize Past and Current Behavior

Automatically take the ideal action on each individual

Target each decision to a customer’s future behavior

Make different offers to groups

of customers

Understand the trends in the business

Predict Future Behavior and Adapt

Dec

isio

n Va

lue

Analytic Capability

© 2014 Fair Isaac Corporation. Confidential. 22

Decision Management Provides the Solution

Benefits of Decision Management

Make changes in a fraction of the time and cost

Deploy analytic models in hours not months

Develop and deploy solutions in a tenth of the time

Adapt and learn to continually act correctly

Optimize for the best outcome across actions

Increase decision accuracy by orders of magnitude

© 2014 Fair Isaac Corporation. Confidential. 23

Through innovative techniques… …drive more profitable decisions

Transforming 1:1 marketing •  Delivers over 100MM highly targeted offers every week.

•  Unprecedented scale in retail analytics. Individual recommendations selected from thousands of product categories each with their own ‘auto-generated propensity model’.

•  Creates a marketplace for manufacturer investments in 1:1 marketing.

•  New Innovations include: Time to Event Analytics and Up-lift Models

“Coupons normally had a response rate of 1 percent or 2 percent. With eValues, as many as 20 percent to 30 percent of eligible customers collect the discount they are offered.”

Linda Vytlacil, Vice President Member Insights and Innovation, Sam’s Club

24 © 2014 Fair Isaac Corporation. Confidential. 24 © 2014 Fair Isaac Corporation. Confidential.

The Strengths of Decision Management

Historical Data

Industry Data

Transactional Data

Policies and Guidelines

Analytics/Modeling

Business Rules

Optimization

Personalized Treatments

Predictive Offers

Optimal Pricing

Consistency

Accuracy

Auditability

Compliance

Continuous Improvement

Decision Management

25 © 2014 Fair Isaac Corporation. Confidential.

Your Challenge: Do More… Do It Faster… Do It for Less… Do It with Fewer People

Provide Single Customer View

Add New Services

Add New Products

Deliver Cross-Channel

Assure Compliance

Maintain and Update

Future-Proof Investment

© 2014 Fair Isaac Corporation. Confidential. 26

Insight Thrives on Data

► Access to any data, anytime ► Assess what data is valuable

► More reliable predictions ► Better decisions

► Understand the correlations from macro to micro data

► Advanced analytic techniques develop advanced predictions

► Mining consumers as a source of data

© 2014 Fair Isaac Corporation. Confidential. 27

Analytics Give Decisions Insight “There is nothing so terrible as activity without insight” - Goethe

► Connect data and experience ► Analytics can predict what will happen

and when ► Decisions can determine the right action

at the right time

► Optimization will derive the best outcome for the business

► Knowledge can be continually gained: Expertise → Insight → Optimal activity

© 2014 Fair Isaac Corporation. Confidential. 28

Monitor, Act and Learn

► Understand how your business is performing

► Connect decision performance to overall business performance

► Know when you and how you need to change

► Align business performance improvement to cost of change

© 2014 Fair Isaac Corporation. Confidential. 29

Shortening Time to Value Gains Earlier Returns

► Business users controlling which decisions to improve and when

► Simple and easy decision assessment, update and deployment

► Business process and business decisions closely coupled

► Faster integration, easier deployment and scalable infrastructure

► Cloud and on-premise implementation

© 2014 Fair Isaac Corporation. Confidential. 30

FICO® Decision Management Platform is at the heart of analytically driven applications

Big Data

IMPROVE

AUTHOR EXECUTE MANAGE

Analytics Optimization

Decisions

© 2014 Fair Isaac Corporation. Confidential. 31

Conclusions / Summary

► The need to adapt and change only continues to increase ► Decision management is central to improving business performance

► Availability and access to data is exploding ► The right data and insight ensure the best decisions are made

► Understanding performance ensures the improvements made

► Decisions can be made consistently across organizations ► Complicated methods do not require complicated tools

An effective and holistic decision management strategy creates a significant competitive advantage

© 2014 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent.

Thank You

Please contact FICO at: 1-888-342-6336 inside@fico.com

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