Predictive Analytics

Predictive Analytics – Book Review

By: Eric Seigel

Introduction: The Value of Predictive Analytics

In a world drowning in data, Eric Siegel’s book, “Predictive Analytics,” delves into the power of predictive models to extract valuable knowledge from the vast sea of information. Siegel emphasizes the importance of understanding the objectives, techniques, and limitations of predictive analytics to prosper in a predictive society.

PA 101: The Power of Prediction

Prediction holds immense power, especially for businesses seeking a competitive edge by anticipating the future destiny and value of individual assets. Predictive analytics involves learning from collective experiences, guiding organizations to act on predictions and creating what Siegel terms “The Prediction Effect.”

The Ethics of PA: Balancing Power and Privacy

As predictive analytics gains momentum, concerns about privacy and civil liberties arise. Siegel addresses the ethical implications and stresses the need for robust data governance to responsibly handle the power of predictive insights. Organizations must navigate the complexities of data management to fully exploit the benefits of predictive analytics.

The Data Effect: Unveiling Predictive Potential

The excitement of data lies not just in its volume but in its rapid growth. Siegel introduces “The Data Effect,” highlighting that data, by its nature, is always predictive. However, he warns of the risk of mistaking correlation for causation, emphasizing that predictive analysis often focuses on predicting rather than explaining.

The Ensemble Effect: Power in Numbers

Using Netflix as an example, Siegel introduces the concept of the Ensemble Effect, where predictive analytics gains strength by combining multiple predictors. This collective intelligence compensates for individual model imperfections, illustrating the importance of performing predictive analysis collectively to enhance accuracy.

It’s Not What You Ask, It’s How You React: Shifting Focus

Predictive analytics is not solely about predicting behavior but understanding how to influence it. Siegel explores a shift from predicting behavior to predicting influence on behavior, introducing the concept of an Uplift Model. This model scores the likelihood of influencing an individual’s behavior based on different treatments, enhancing the value of predictive analytics.

Future Predictions: Guiding Operational Decisions

Siegel concludes by emphasizing the central role of predictive analytics in guiding decisions across various sectors, from companies to governments, law enforcement, charities, hospitals, and universities. Acknowledging the limitations, he sees predictive analysis as a crucial tool for improving operational efficiency.


In summary, “Predictive Analytics” provides a comprehensive exploration of the transformative power of predictive models, emphasizing responsible use, ethical considerations, and the evolving landscape of data-driven decision-making.

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