Predicting the Future

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Predicting the Future

  1. 1. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predicting the Future Presented by: Dean Whittaker, CEcD Economic Development Institute Kansas City 2010
  2. 2. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Learning Objectives  Broaden your understanding of the use of Business Intelligence in economic development.  Be capable of applying new information resources and tools to predict future events.  Share knowledge among participants.
  3. 3. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Economic Development – Making the Pie Bigger
  4. 4. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Economic Development Context  Changing nature of work – work moves, workers stay put  Globalized, automated, outsourced, and off- shored  Increasing concentration of wealth in the hands of a few
  5. 5. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc The History of Prediction  Prophets  Astrologers  Soothsayers  Fortune Tellers  Palm Readers  Economic Developers
  6. 6. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Business Intelligence  Using information to make better decisions  Reduce risk and predict outcome  Focus your effort – “biggest bang for the buck”  Brains vs. Muscle  Abundance of information, scarcity of attention
  7. 7. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc The Information Cycle
  8. 8. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc The Role of Information  Reduce risk  Increase certainty  Predict outcome
  9. 9. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Seeing the Future  Look to the past  Repetitive pattern  Cycles  1,000,000 year  1,000 year  300 year  100 year
  10. 10. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Measure Change Over Time to Predict the Future  Barometric Pressure  Length of Daylight  Solar Flares  Waves  Light  Sound
  11. 11. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Time Event Linear Thinking in a Cyclical World
  12. 12. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Time Frequency The Long Tails of the Black Swan
  13. 13. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Exercise I: Build a Community Economic Barometer  Identify five “real time” factors that could be measured to create a real time view of the local economy  Identify five “leading” indicators that would forecast future economic performance.
  14. 14. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Economic Barometer  Measuring the Economy  Usage of Resources  Electricity  Gas  People  Raw materials  Transportation  Movement of goods and people
  15. 15. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Types of Cycles  Tipping Point  Precipitating events  Outliers  The long tail  Cycles  Repeating pattern
  16. 16. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predictive Analytics  What is it?  Why should you care?
  17. 17. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predictive Analytics  Predictive analytics is an area of statistical analysis that deals with extracting information from data and using it to predict future trends and behavior patterns. The core of predictive analytics relies on capturing relationships between explanatory variables and the predicted variables from past occurrences, and exploiting it to predict future outcomes. Source: http://en.wikipedia.org/wiki/Predictive_analytics
  18. 18. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predictive Analytics  Statistics  Correlation vs. causal  Pattern recognition  Knowledge mapping
  19. 19. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Ranking Predictive Model  Use of Weighted Matrix  Control Group  Variables  Weighting
  20. 20. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Examples of Predictive Models  Corporate Behavior  Sporting Events  Return on Investment  Loan Repayment
  21. 21. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Business Intelligence  Predicting Corporate Behavior  Behavior linked to history  Accuracy - function of data available  Giving Information Meaning  Data…information…knowledge…action  Assumptions  Rational Behavior?  Cyclical
  22. 22. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Economic Cycle  Boom/Bust  36,000 year economic cycle  Generational  Baby Boomers  Generation X, Y, and Z  Corporate life cycle  Product life cycle
  23. 23. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Product Life Cycle
  24. 24. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predicting Corporate Behavior  Probability to close or have major layoff  Probability to relocate, expand, or consolidate facilities
  25. 25. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Exercise II: Business at Risk An Early Warning System  Identify five “leading” factors in their business environment and five within the company that would indicate a company is at risk of closing or laying off a significant number of employees.  Weight each of the factors by its relative importance in being predictive.
  26. 26. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Exercise III: Targeting Businesses for Attraction  Identify five “leading” factors in their business environment and five within the company that would indicate a company that is likely to relocate or expand  Weight each of the factors by its relative importance in being predictive.
  27. 27. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Why Target Companies?  Focus energy and effort  Limited resources of time and money  Maximize results  Brains vs. muscle
  28. 28. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Why do Companies Relocate or Expand?  Internal changes  Ownership  Leadership  Others  External Changes  Business Environment  Regulatory Environment  Others
  29. 29. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Predicting Corporate Behavior  Key Drivers  Change  Leadership  Ownership  Product/Service  Client Preference  Metrics  Sales  Employment
  30. 30. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc How to Target Companies  Creating a target company profile  Target industry  Size  Location  Corporate Changes/Events  Others
  31. 31. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Where to Find Company Information?  Primary Company Information  Secondary Information
  32. 32. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Google  http://www.google.com  http://www.new.google.com  http://finance.google.com/finance  http://labs.google.com/  http://google.com/trends
  33. 33. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc People  Linkedin.com  Facebook.com  Others
  34. 34. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Places  www.ZipSkinny.com – a zip code-based demographic comparison tool  www.earth.google.com – a bird’s eye view of earth and beyond  ZoomProspector.com – a geographic information site selection tool
  35. 35. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Fee-Based Internet Resources  www.Hoovers.com - excellent source of company information  www.OneSource.com – broad multiple sources of news and company information  www.Nexis.com - news sources for events
  36. 36. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Web 2.0 – The New Media  Social Networks  www.LinkedIn.com  www.Facebook.com  www.MySpace.com  Streaming Video  www.YouTube.com  Podcasting
  37. 37. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Websites of Interest  www.factcheck.org  www.wikipedia.com  www.whittakerassociates.com  www.ceoexpress.com
  38. 38. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Summary  Context  Role of Information  Information Cycle  Predictive Analytics  Predicting Behavior  Weighted Matrix  For More Information
  39. 39. Copyright 2003 Whittaker Associates, IncCopyright 2007 Whittaker Associates, Inc Thank you for your participation Dean Whittaker Dean@whittakerassociates.com 616-786-2500 www.whittakerassociates.com

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