I don’t know why I’m on this medical theme lately – maybe it’s because my parents are aging. They talk about bits falling off, take lots of naps and describe how body parts don’t work like they used to. They’ve gone to pre-packaged pills – dividing up their medications by day and time of day by the local pharmacist. It’s helped a lot. I’ve got a lot more confidence that my Dad won’t (again!) take a sleeping pill, first thing in the morning - before he gets in the car to drive. Ugh.
Confidently knowing what action needs to be taken because it’s pre-packaged is very appealing to many aspects of business too. Wouldn’t it be nice to know that front-line workers make all their decisions in a particular situation based on expert advice that includes organizational policies and requirements? Even when it’s not people, but other systems or even devices making decisions. Like in the Internet of Things, isn’t it necessary for those things to base action on situational understanding - triggering a specific (and appropriate) action for a particular scenario? Yes, particularly when we turn our decisions over to machines to make them for us.
Taking prescriptive actions includes the benefit of:
- Consistency – under the same scenario conditions the same action is take
- Repeatability – when the same situation arises, you can reuse the same logic
- Efficiency – no additional energy is spent investigating the action to be taken, it’s prescribed.
And together, these things reduce the risk of the wrong decision being made and an inappropriate action being taken.
So where do you get the expertise in the prescribed action? My parents get it from a subject matter expert - the pharmacist, who, based on his training, directions from the doctor and knowledge of current medications defines which pills go into which sealed envelop. In fact, their pharmacist was able to decrease their medications – simply because of his perspective on the buffet of pills they’d been prescribed over the years.
Organizations get the expertise from a few places. From their analytical experts who examine operational data to assess the pros and cons of different factors influencing behaviors and outcomes – summarized in advanced analytic models. From business analysts, who consider situational conditions, organizational policies, regulatory controls and analytical model scores in relation to decision objectives. They develop the business rules that define the conditions under which an analytical model is relevant. From their IT departments who have spent time collecting, cleansing and normalizing operational data to ensure currency, accuracy and availability. And from corporate executives who determine organizational policies and mandates to align stakeholder and compliance requirements.
In a recent IIA Research Brief the difference between predictive and prescriptive analytics is detailed. The paper also goes into more depth of how you gain (likely untapped) prescriptive insight from unstructured text data – it’s amazing the direction that is often included in narrative. Going beyond the data discussion, it describes how prescriptive actions are codified using the discipline of enterprise decision management. And lastly, it explores the impact of big data in the form of streaming data – necessitating more operational and tactical decision discipline.
The Wrinklies (my nickname for my folks) have taken some of the guess-work out of their routine and we all agree, they are better off for it. Giving you more confidence, what operational activities in your organization would you like to see prescribed?