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The Decision Factor offers insightful comments and observations on analytics—from views on new technology approaches and market dynamics to the latest industry trends driving demand for faster, smarter information analysis. This blog contains personal views, thoughts, and opinions from SAP employees, mentors, and friends working in the area of analytics. It’s not endorsed by SAP nor does it constitute an official communication of SAP.


Transform Your Future with Predictive Analytics

predictive analytics on digital tablet

We’ve all experienced some form of predictive analytics in our day-to-day lives – each time we check the seven-day weather forecast or price airline tickets for a future trip. And while we’ve become accustomed to this technology in our daily lives, how many businesses take advantage of this power to anticipate the future?

According to a best-practices report by The Data Warehousing Institute (TDWI), “Predictive Analytics for Business Advantage,” not many: Only about 20% of organizations surveyed report having some predictive analytics activity already under way.

That’s not to say companies are completely in the dark. According to a …

Predictive Analytics: The Case, Cause, and Effect — What’s Most Important?

Predictive analytics

Most would agree that every business, in every industry, requires more forward-looking, predictive analysis, giving management a good indication of expected results based on historical patterns that have developed over time. Predictive analytics, a logical extension to traditional business intelligence (BI), achieves what traditional BI was never intended to answer.

The Business Case

Typically, predictive analytics derives from a perceived performance problem in sales, inventory, supply optimization, marketing, etc. However, a reactive approach rarely garners the results that a proactive approach does. So, can’t we simply foresee that we need predictive analytics from past reactive failures?

Sounds ridiculous when posed …

Serving a New Generation of Consumers with Predictive Analytics

woman pushes shopping cart in grocery store

Consumers today are savvy, fickle, and demanding. They want to be associated with brands that are relevant and compelling. With the evolution of social media, today’s global marketplace trends to proliferate at the speed of light for both positive and negative consumer sentiment.

So, how do consumer products companies stay profitable in these challenging times? The answer is by aligning every aspect of their operations to the end customer—the consumer. Enter predictive analytics, which is gaining demand in this industry to keep up with the competition.

Improve Consumer Loyalty and Acquisition with Predictive Analytics

Consumer products companies are now developing …

It’s Not Your Grandfather’s Governance

predictive word

I’ve been interacting with a few customers over the last few months, and our core discussions have focused on data governance with respect to the new age of data discovery and predictive modeling. One of the repeated discussions we had was about the gap between the governed and ungoverned, and many of them see that it’s widening. Several of the executives worried about the mainly known perils of ungoverned data discovery, predictive modeling, and ultimately, the applied decisions.

These discussions inspired me to write this blog post. The intent is not to boil the ocean regarding the parts of …

Fueling Your Business with Predictive Analytics

innovation predictive analytics

Imagine knowing the exact amount of supply you will need in 12 months or understanding your current supply levels in real time. How about knowing exactly what your customers need before they even know they need it?

These scenarios are real possible business situations that can happen by using predictive analytics. Predictive analytics help companies understand these (and other) potential situations by processing vast volumes of data and turning it into insights to foster better and more informed decision making.

It takes data and processing to create and use these predictive analytics to fuel a business and enable decision-making …

Fraud Attacks Come From Unexpected Places – Can Predictive Analytics Help?

fraud and predictive

Recently, I had a chance to watch one of those old, French cult movies of the 60s from the recently deceased director Georges Lautner (an institution in France) entitled “Ne nous fâchons pas” (Let’s not get angry).

In one scene, the main male character seeks to engage in business with a rich (and wary) heiress. To gain her confidence, he tells her: “People always tend to see gangsters as stocky, dark-haired guys. It’s the silliest prejudice!” To which she answers, “And I have another one for you—they tend to think that a tall, blond woman is inevitably daft… Missed!”

Simple Predictive Finance—Everything Is Profit and Loss

dollar amounts in columns on paper currency

As I mentioned in my last blog, Simple Predictive Finance: Why the Dream Is a Reality, the finance function is transforming with advances in technology and predictive tools. There are several key points that I believe can help people better understand the context of predictive finance. I covered the first two (simplicity and the path to governed data discovery) last week. Today, we’ll cover a couple more.

The Mission Is Margin Improvements

Everything in any given organization is profit and loss. From the top floor …

Simple Predictive Finance—The Power of Storytelling and the War for Talent

young people learning together

In this blog series, I’ve covered some of the key points that I believe can help people better understand the context of predictive finance (see Simple Predictive Finance: Why the Dream Is a Reality and Simple Predictive Finance— Everything Is Profit and Loss). Today, I want to discuss the role of visualizations and the importance of analytics training in finance education.

Utilize Visualizations to Tell the Numbers’ Story

The human brain works …

Simple Predictive Finance: Why the Dream Is a Reality

future target with arrows in bulls eye

For a couple decades, there was a quote about prediction that everyone seemed to jump on, “Prediction is very difficult, especially about the future.” This not very provocative sentence from the first half of the 20th century (by Physics Nobel Prize winner Niels Bohr) was popular for good reason. How could you possibly be able to predict anything except death and taxes? (Another famous quote, but I won’t go there…)

Where I live, people may not even listen to the weather forecast, since it doesn’t have a great impact if you’re expecting 95 or 97 degrees in Central Texas …

Why Turkeys Can’t Wait for Thanksgiving: The Difference Between Business Intelligence and Predictive


As we know, Thanksgiving is certainly not the best moment to be a turkey. So why do they, in fact, look forward to ? The answer is simple – they look at the past day and see how wonderful the past few days and weeks have been. And they assume the future will be the same.

Indeed, days after days their owners are taking better and better care of them, ensuring that they’re very well fed and that they grow in the best possible conditions. And each day that the owners take a little better care of them, they really …