What is it?
Before we go deeper into this question a quick explanation on Machine Learning to get everyone on board.
Machine learning is a method of data analysis that automates analytical model building. It is a form of artificial intelligence based on the idea that by identifying patterns systems can learn from data and make decisions without human interaction.
It is important to note that machine learning is iterative. Every time a model is run on new data the model can be adapted and improved. This way machine learning can produce reliable and repeatable results over time.
Machine learning has been around for a long time already and there are many proven models and algorithms that can be used. Some examples that we have known for some time already include spam filters, optical character recognition (OCR) and others. A more modern example that many already experienced are Netflix suggestions. It is a form of pattern recognition and with every series you select new data is introduced and the suggestion for you is more refined.
Why is it important for business?
Advanced analytics, like machine learning, used to be dedicated in the past to specific cases and fields in business where there was enough data and incentives to make it worthwhile.
Today things are different. The amount of data available today is exploding. Processing power and storage are more powerful cheaper than ever. All these things combined mean that it is possible to quickly generate models that can analyze huge amounts of complex data. These models are giving faster and accurate results. This enables business to have a better chance of spotting opportunities or avoiding risks.
There are some well-known examples of course. In finance, automatic fraud detection on transactions or suggestions made by Amazon based on your profile and what similar profiles bought.
But here are other applications as well:
- In online sales only 1 in 25 customers on average expresses dissatisfaction before going to the competition. What if you could recognize that behavioral pattern and act before they leave?
- In production, what if you could automate quality control with image recognition and perform checks on all products in stead of a sample set?
- In Operations, what if by detecting patterns in energy consumption you could lower costs and reduce your carbon footprint at the same time?
There are many more possibilities available to effectively use machine learning to optimize your business.
To get back to the question. Is machine learning a hype? In our opinion it is absolutely not a hype. It is a just the next logical step in analytics and problem solving since Alan Turing laid the foundations of modern computing as we know it today. Machine learning helps the analytics systems become efficient, more accurate and more powerful. It will facilitate and automate advanced analytics and predictive analysis. It allows business to focus on the core: improving operations and business.
Give us a call and start using machine learning today!