Tuesday, November 19, 2013

MIni-Post: The Past Isn't Even Past -- Unless You Use "Proactive Analytics"

I'm referring here to a quote from William Faulkner:  "The past isn't dead.  It isn't even past."  More specifically, I am noting the degree to which past mistakes in dealing with the customer get embedded in the organization, and hence repeated, leading to greater and greater aggravation that eventually results in a divorce over what seems to the organization to be the most trivial of customer pretexts.

I was reminded of this quote when I visited one of the demo booths at IOD 2013 and found a fascinating example of the application of artificial intelligence to analytics -- so-called "proactive analytics."  Essentially, the app combs through past data to see if it's consistent, or whether some of it is possibly wrong, and then comes up with a suggested change to the data or metadata (as in, a change to one's model of the customer) to fit the amended data.

To me, this is one of the good things about artificial intelligence, as opposed to the "knowledge-base" approach that is somehow supposed to produce human-equivalent intelligence (and about which I have always been a bit skeptical).  One of the key original insights of AI was to divide reasoning into logical (where there is an adequate base of facts to establish a good rule about what to do) and intuitive (where facts are incomplete or unclear, so you have to muddle through to a rule) processes. In intuitive situations, AI found, the quickest way to a rule that gets closest to the underlying reality is to focus on the data that didn't fit, rather than focusing on data that seems to confirm an initial hypothesis.  And so, proactive analytics apparently targets this highly useful AI insight, focusing on what doesn't fit and thereby iteratively coming up with a much better model of the customer or the process.

All this is abstract; but then the demo person came up with an example that every company should drool over;  combing through customer records and detect deceased, moved or terminated customers.  And to me as a customer, this holds out the real possibility that I will no longer get sales literature about an estate-property-sale LLC long since terminated, letters addressed to "Wayne Keywochew, Aberdeen Group" (a stint that ended 9 years ago), or endless magazine subscription offers because of something I once ordered.  Multiply me by millions, and you have an incredible upgrade in your customer relations. 

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