Know AI to use it
Turin, April 12, 2023
by Fabrizio Fantini and Francesco Orlando
If it is evident that today the media occupation and the absorption of Artificial Intelligence investments are massive, it is also true that few companies really know what they are talking about in concrete terms, what impacts and benefits can be obtained and above all how use and manage it. Let us try to clarify some concepts.
Essentially, we talk about a lot of data and their use through analytical methods, to improve business performance in a relevant way. In particular, companies try to guide their decisions based on the expected results, so far relying on the analysis of past events. Often, however, predicting the future based on the past does not work. Therefore, in order to overcome the common and simpler descriptive analyses, based on historical trends, through tools such as Excel, Power BI and the like, we focus on more advanced analyses, called prescriptive, abandoning the search for a forecast, to embrace the self- continuous and systematic learning. At the base there are statistical models to define the probabilities that certain situations will occur in a given future, based in real time on everything that is observed, both inside and outside the company.
The self-learning prescriptive model, based on simulations determined by algorithms, continuously profiles customers, products and prices to optimize decisions even in periods of frequent discontinuity. The tools needed? Large amounts of data, advanced information technology infrastructures, specialist skills, extensive knowledge of the context and the ability to translate it into terms that a binary machine can understand. From a practical point of view, a manager could see the historical evolution with descriptive analyses, decide on a correct geographical allocation of sales personnel, cross-referencing various data with the predictive method, and optimize prices to maximize sales and making a decision that varies over time with the prescriptive model. Ultimately, knowing it well, artificial intelligence can be a great ally for business competitiveness.
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Source: La Ragione
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