Predictions for 2018 by Gary Cokins

4 min read

What was, in your opinion, the most important thing that happened in Analytics in 2017?

My opinion is that the most important thing that happened with BI and Analytics in 2017 involved its reaching a “tipping point”. This is where Analytics is now being commonly accepted as required by any organization to remain viable.

Much has been written about Analytics providing a competitive advantage. This was more of a “nice to have” message. This is now advancing to where Analytics is a “must have”.

What is, in your opinion, the most important thing that will happen in Analytics in 2018?

I believe the most important development related to BI and Analytics in 2018 will be further advances with real-time visualization including animation. When we were children our mothers told us “Looks are not everything.” She lied! They do. Today managers and analysts are very busy with many priorities. Their time to analyze information is limited. It is cumbersome for them to interpret stacks and columns and rows of table data. They want pie charts, histograms, and more.

Adding animation to visualization enables viewers to more rapidly focus on what matters and in an eye appealing way. Real-time visualization involves changing an input independent variable, such as forecast sales volume, with a “slider” on one’s computer or mobile device, and then immediately viewing the results. With this example of sales volume forecasts the real-time calculated result would be the changes in profits.

If I were to choose another “most important thing” it would be the prevalence of automated decision rules. These might be algorithms designed by data scientists. For example, why allow a sales person to determine the level of a price discount or type of coupon, offer, or deal to boost sales volume. The computer can calculate optimal level or type to maximize not only sales volume but bottom-line profits as well.

There was a lot of talk about robotization in 2017 – how do you think this will affect businesses in 2018?

Businesses are now vulnerable to the impact from robotization. The impacts from artificial intelligence (AI), machine learning, robotic process automation (RPA), “digital transformation”, and cognitive software is not hype. Their rate of adoption is accelerating at a rate that is underestimated by many. The severity of their impact will be substantial, especially involving the replacement of jobs by these technologies. Very few organizations are prepared for this change.

There is a role for robotization in virtually every aspect of a business: forecasting financial performance; pricing products and services; strengthening operations; tracking consumer preferences and spending patterns; identifying new markets; improving profit margins; and assessing and monitoring risks.

Organizations must either “disrupt” or “be disrupted”. Companies often fail to recognize disruptive threats until it is too late. And even if they do, they may fail to act boldly and quickly enough. Embracing “digital transformation” is their recourse for protection, viability, and preservation. They need the competence to choose the technologies fitting them and to be demanding and aggressive in adopting them. Robotization never takes a vacation or gets tired. It can operate 24/7.

Big Data is said to be a dying term, and Business Intelligence appears to go the same direction. Do you agree with this, and if so, what do you think is the best term that can replace these?

Business Intelligence (BI) has been replaced by its advanced stage – Business Analytics. This because BI is increasingly being marginalized as only being in the realm of reporting where one is reactive to its information. In contrast, Business Analytics facilitates being proactive by anticipating problems or opportunities.

Big Data is a convenient term that describes access to greater amounts of data, both internal within an organization and external residing in the Internet. Big Data also implies more granular detailed data and accessible in real time. In my opinion Big Data is about providing access to data, but access to data is only a door opener. The compelling issue is answering the question “what does one next do with that data?” What insights are gained? What better decisions can be made?

What is a better term? That is a good question. My candidates are “digitalization” and “Big Data Analytics”.

What new concepts and buzzwords do you think will appear in Analytics in 2018?

The existing continuum for analytics is from descriptive, diagnostic, and predictive to prescriptive analytics. I am uncomfortable with this pinnacle term “prescriptive”. It implies to me a physician prescribing a pill or drug to address an ailment. My preference would be to replace “prescriptive” with “optimization”. The final stage of the analytics continuum goes a step above the predictive stage question of “what are the possible outcomes?” to answer “what is the best choice of action?”

About Gary Cokins

Gary Cokins is the founder of Analytics-Based Performance Management LLC, an advisory firm. He is an internationally recognized expert, speaker and author in advanced cost management and performance improvement systems previously a principal consultant with SAS. You can contact him at [email protected] . For more of Cokins' unique look at the world, visit his website at www.garycokins.com .