In anticipation of his upcoming conference presentation, What it Means to the Data Scientist as Financial Services Faces Disruptive Times, at Predictive Analytics World for Financial in Las Vegas, June 3-7, 2018, we asked Richard Boire, Senior Vice President at Environics Analytics, a few questions about his work in predictive analytics.
Q: In your work with predictive analytics, what behavior or outcome do your models predict?
A: It really depends on the business problems we are trying to solve. They can range from building response models, attrition models which are typically marketing-related.
However, an increasing part of my work is risk models and fraud models. At the same time, I have also built operational models that identified key activities or tasks that led to a negative outcome.
Q: How does predictive analytics deliver value at your organization – what is one specific way in which it actively drives decisions or operations?
A: If we think about the above answers, building models and tools that ultimately optimize marketing behaviour as well as risk behaviour, we are in effect allowing the organization to base their decisions on the profitability of the customer.
Q: Can you describe a quantitative result, such as the predictive lift of your model or the ROI of an analytics initiative?
A: In almost all cases, predictive analytics are delivering overall lift results of at least 50%. The ability to achieve such significant improvements in predictive analytics has been the impetus behind the tremendous growth in data science departments within most organizations. I remember building a model for a major bank in the late nineties where they had no data science expertise. As a result of the model’s success, this bank now has a center of excellence, a chief analytics officer, and teams of data scientists. They now recognize that it’s not just about data but more importantly having the best tools and people to turn data into insights and insights into actions.
Q: What surprising discovery or insight have you unearthed in your data?
A: During my many years as a practitioner, one constant insight is that it is the data and how the data scientist “works’ the data and less about the mathematical technique in building
more powerful predictive models. Over the years, we continued to look at different techniques and software and we always found that minimal lift if any lift at all could be achieved over the status quo which essentially relied on creating the right analytical file and the use of simple multivariate techniques such as regression.
Q: Sneak preview: Please tell us a take-away that you will provide during your talk at Predictive Analytics World.
A: One takeaway will be the key things to consider when adopting artificial intelligence within the data scientist’s toolkit.
Q. What are some of the big changes in predictive analytics that you are experiencing as a data scientist?
A: Big Data and artificial intelligence are arguably the biggest disruptors of our economy in the new millennium. As data scientists, though, it is incumbent on us to be thought leaders in what this means to businesses and other organizations as we move towards a data-driven society. There needs to be a much more collaborative approach within the data science community where skills can range from individuals steeped in the arcane technical details of artificial intelligence to those data scientists who are the story tellers of how to action the data. Much work and effort needs to be done in this area and financial resources should be devoted towards fostering this increased collaboration.
Don’t miss Richard’s conference presentation, What it Means to the Data Scientist as Financial Services Faces Disruptive Times, on Tuesday, June 5, 2018 from 4:20 to 4:40 pm at Predictive Analytics World for Financial in Las Vegas. Click here to register to attend. Use Code PATIMES for 15% off current prices (excludes workshops).
By: Eric Siegel, Founder, Predictive Analytics World
Eric Siegel is the founder of Predictive Analytics World (www.pawcon.com) — the leading cross-vendor conference series consisting of 10 annual events in New York, Chicago, San Francisco, Washington DC, London, and Berlin — and the author of the award-winning book, Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die – Revised and Updated Edition, (Wiley, 2016).