There are two types of models, predictive and descriptive. Descriptive models are good to explain what has happened and what is happening. Predictive models explain what would be happening and why. These models are increasingly being utilized to solve problems across finance, marketing, human resource, operations and other business functions. At Ronan Analytics, we have seen these models being used in financial services, retail, telecom, insurance, healthcare and even manufacturing industries.
Increased competition has expanded the scope, the need and the use of predictive modeling. Businesses need to be more proactive than before to build or sustain a competitive advantage. They need to get answers for tomorrow even before it arrives.
Predictive models are created using past and present data to foresee happenings in future. These models are being built to find answers to some of the most challenging businesses questions. It helps to manage portfolio returns, retain customers, undertake cross-selling activities, organize direct marketing campaigns, assess employee attrition and absenteeism, manage risks and formulate underwriting criteria, predict inactive customer accounts, cope with customer service requests, plan inventory and much more.