A Path to Insights and Improved Making: Predicitve Analytics


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A Path to Insights and Improved Making: Predicitve Analytics

  1. 1. A Path to Insights andImproved Decision Making:Predictive Analytics Industry Perspective
  2. 2. Predictive Analytics Overview Today, government is challenged like never before. In an era of budget cuts, increasing demands for services, and increasingly complex government trans- actions, government officials are pressed to think of new ways of thinking and innovative solutions to complex problems. Throughout this report, Nathan Greenhut, IBM Center of Competence So- cial Segment, identifies predictive analytics as a way forward to cut through government’s most pressing challenges. This report also highlights the use of predictive analytics by the Memphis Police Department to improve the public safety for the citizens of Memphis, Tennessee. Although government is becoming increasingly complex, and citizens and agencies are producing high volumes of data, predictive analytics can provide a path to insights and improved decision making for public sector entities. Nathan Greenhut Government Center of Competence - Social Segment IBM
  3. 3. A Path to Insights and Improved Decision Making:Predictive AnalyticsEveryday government officials their operational costs, while As Nathan identifies, there are direare working to transform how increasing ability to handle rising consequences for the public sectorgovernment operates. In a time caseloads to deliver better and if information is lost or stolen. Withwhen budgets are rapidly shrinking, more effective services for citizens. dozens of efforts by government towhile there is also an increased As the economy slowly recovers, stop waste, fraud and abuse, securingdemand on government services, there are increased pressures on government data is essentialgovernment is challenged to government to provide much for any technological initiative.find new models of thinking and needed services to constituents.reframe the traditional view of With the variety of data thathow government provides services. Although the budget is the core is created, and with the use of challenge, another challenge predictive analytics, the coreRecently Pat Fiorenza, GovLoop facing government is that as new challenge for agencies is how toResearch Analyst, had the chance to technology is implemented, risks best drive decisions from data.speak with Nathan Greenhut, IBM are becoming more pervasive. Nathan states, “GovernmentGovernment Center of Competence agencies are challenged to turn- Social Segment, about the With increasing use of cloud data into actionable informationpower of predictive analytics and services to store data and facilitate on a timely basis. The volume ofthe ways agencies can use data collaboration across agencies, data is rapidly growing, causingto transform service delivery. there is increased security risks more time needed to decipher to compromise government data. data into usable information.”Unquestionably, the state of public Nathan states, “Evasion schemes andsector budgets has sculpted and scams appear more sophisticated Nathan continued, “There is pentimpacted the public sector’s ability and more global. Schemers are up demand from operations forto provide services. Nathan and Pat using technology to make evasion unified and timely informationdiscussed that budget deficits have faster and easier. Fraud, waste, and predictions. Also, there isslowed investment and increased abuse and error drain resources demand for improved processespressures to stop fraud and errors. and undermine public support. In to provide services with greaterGovernment organizations are addition, inconsistent decisions and impact, consistency, transparency,looking for solutions for lowering strategies are creating serious risks.” reliability and effectiveness.”
  4. 4. Although now is a challenging time for government, organizations meet their most pressing organizationalthere has been much room for innovation in challenges. Further, the multiple kinds of data that isgovernment. As technology has rapidly evolved, there created by customers through services, agencies are noware now new, innovative technological solutions to help challenged to turn various kinds of data into insights. 44X information is exploding 60 percent of mission leaders change outpacing the ability to DIGITAL DATA have more data keep up GROWTH THROUGH 2020 than they can use effecitvely 80 sOURCES OF INSIGHT ARE 12 percent increase in Performace gap is PERCENT OF INFORMATION- MULTIPLYING performance widening UNSTRUCTURED by organizations CONTENT that apply analytics Data Cited from: Fraud and Error Management in Social Security and Revenue AgenciesThe chart above describes the technological infrastructure and acurrent state of data and how much plan for how to use data, agenciesdata is created by users, Nathan will be lost in the tsunami of data TOP TEN BENEFITS OFalso provides a fanastic overview,stating, “The volume and variety that is being created. PREDICTIVE ANALYTICS :of information (structured and This is where predictive analyticsunstructured) is exploding. comes into play for government 1. Smarter detectionTurning data into information agencies, and holds great promise for the public sector to meet 2. Prioritize workloadsand then into action is becomingmore important than ever before.” citizen demand. For government 3. Monitor progress and KPI’s agencies, the power of analytics 4. Detect patterns to initiate actionNathan continues,“There is a larger rest in the agency’s ability toburden placed on organizations, transform data into knowledge. 5. Aggregate and correlate informationas the volume and variety of 6. Optimize processes and performanceinformation grows.   This makes Nathan stated, “Predictive analyticsa larger inertia to go from data can be used for determining 7. Identity insights and relationshipsrich and information poor to events or outcomes before they insightsinformation rich.   Also, planning happen, simulation of a process to 8. Catch suspicious trends before lossfor the size and shape of data is determine bottlenecks and risks occursgrowing in importance to ensure as well as in “what-if ” scenarios 9. Achieve improved collaboration andthe pipelines are built for the flow to determine the “best” course of controlof data, information and action.” action.   For fraud, abuse, waste 10. Embed logic into case management and error predictive analyticsWithout a plan of action, a strong can be used to ensure the proper systems
  5. 5. hurdles are placed for schemers and scamers to have disillusioned citizens, and was challenged toto climb over.” Armed with these kinds of insights, think of new ways to curb trends of rising crime.government agencies can make smarter businessdecisions and redefine business operations. With Larry setting the stage and explaining the situation facing the city, representatives from theOne of the best case studies about predictive analytics Organized Crime Unit, District Attorney Generalcomes from the Memphis, Tennessee Police Department. Bill Gibbons, and Dr. Richard Janikowski, a professorLarry Godwin, Director of Police Services, Memphis of Criminology at the University of Memphis,Police Department, recently was profiled in an IBM started to think through innovative solutions toSmarter Planet Leadership Series Report, highlighting curtail rising crime in a time of fiscal austerity.the “Blue CRUSH”   (Criminal Reduction Utilizing Professor Janikowski had worked on a variety ofStatistical History) program. GovLoop also recently analytical initiatives to understand crime data.  hosted a webinar, speaking with Dr. Janikowski, anotherkey player in the development of the Blue CRUSH At the University of Memphis, Professor Janikowskiprogram. also served as the Director of the Center for Community Criminology and Research. An IBMUnder Larry’s direction, the Memphis Police Department report states, “Now, with the MPD requesting hishas started to try and tackle crime through innovative input, Janikowski saw the opportunity to put intostrategies, predominantly focusing on predictive practice the simple yet powerful principle that “If youcrime prevention practices. Larry called together focus police resources intelligently by putting themcolleagues and began to explain the dire situation in the right place, on the right day, at the right timefacing the police department. As with many local good things are going to happen,” says Janikowski.governments, Memphis faced shrinking budgets, “Ifputtingfocus policetheresourcesplace, on the you intelligently by them in right right day, at the right time good things are going to happen,” says Dr. Richard Janikowski, Associate Professor of Criminal Justice, Memphis University. ”
  6. 6. “ Godwin’s aim was to show how the intelligentalignment of police resources would effectivelyenable the department to close the manpower gapnow—a must in the eyes of Memphis’s citizens.”After some initial success, Larry decided to their own deployment decisions based on intelligenceagain go against the grain, and share crime data provided by the solution. Most importantly, resultswith Professor Janikowski’s team. Using this would be rigorously measured and commanders heldpreliminary data, Professor Janikowski was able to accountable for their performance. It didn’t take muchbuild a pilot program to look into ways to reduce selling, because a few hours later, Godwin and thecrime in the city. The results in the initial pilot mayor were standing in front of the press touting thewere through the roof. The IBM report states: newly approved program—which came to be known as Blue CRUSH—as a way to intelligently reduce crime.”“A few months later, that effort materialized into athree-day operation that proved to be one of the most Since Blue CRUSH has been implemented, thereeffective ever. By identifying hot spots at a granular has been a decline in crime in Memphis. The Citylevel, MPD made some 70 arrests in just the first reports a decrease of 30% reduction of serioustwo hours—a number usually made on an average crime, and a 15% reduction in violent crime. Blueweekend—and went on to make a total of 1,200, CRUSH allows the police department to be morewith crimes ranging from drugs to weapons charges productive and efficient how they use their crime data.to prostitutionand other “quality-of-life” offenses.” The IBM report does a great job identifying how theAfter the initial results, Larry realized the potential system works, as the report mentions, the goal is toof the program, but knew that the success wouldrequire operational support from each department. “police smarter, not harder.”To keep the program moving forward, Larry developeda business case for the mayor, highlighting the dire 30%state of the budget, and the need to find solutionsto complex problems in new and innovative ways. Reduction in Serious“Godwin’s aim was to show how the intelligent Crime 15%alignment of police resources would effectively enablethe department to close the manpower gap now—amust in the eyes of Memphis’s citizens. Under the Reduction in violentplan Godwin proposed, each precinct commander Crimein the MPD would be given the resources (in theform of overtime funding) and flexibility to make
  7. 7. With BlueCRUSH being a successful will have a great impact, usually many of the folks listed above ascase study – where can other well as some others (trainers, documenters, etc.) are needed as well.”agencies start with a predictiveanalytics strategy? Once the workforce is set and the data is understood, Nathan advises the following for agencies to get started with predictive analytics.At the heart of predictive analytics Nathan believes that most government agencies already have inis data. Nathan states, “Overall, place at least some approaches to manage predictive analytics, tothere is a major drive for big data mitigate risky events or increase rewarding events, some examplesin government. The main challenge that Nathan identified were audit and sampling processes, rules basedon this end of the data spectrum interventions, ad hoc reports and analyses and full investigations.is that most government agencieshave trouble managing their data Nathan also provides some targeted and important questions thatyet alone, performing predictive should be asked while working on a predictive analytics plan, someanalytics on the data that they have.” questions that Nathan posed included: What is the key business problem to solve? What existing capabilities does the organizationNathan keenly observed, “There is have? What is the state of my data the data I want to predict from?not only a need for big data to openup analysis possibilities tomorrow, As part of the mission of GovLoop is facilitating knowledge sharingbut also a need for the right data and information around core topics facing government professionals,and information for action today.” Nathan was sure to provide some best practices for those already engaged or about to engage in a predictive analytics campaigns recommended:During the interview, Nathanacknowledged that a predictive Make sure there is a document with major system/process changes foranalytics program cannot happen the agency. When pulling together predictive analytics you will want towithout the right skill set and know when these events occur.employees. Nathan states, “Myrecommendation is to havesomeone who has done a number Determine the “just right data” upfront. If you place all the data youof predictive analytics assignments have into predictive analytics right away, you may get jammed up. Itand knows a variety of data is best to start small and think strategically about how to integratesources as well as agency subjectmatter experts (SME’s) team up to predictive analytics into the right processes or even the right processdetermine what the most valuable step.data is for the agency. This willhelp to keep the scope in check on Using technology tools to prioritize the benefits, claims, and paymentsa particular project and get resultsand payback much quicker.” allows smart people to do their jobs better.Nathan provides more insights asto the type of workforce needed for Start projects small but think about the longer term strategicallypredictive analytics, “For predictiveanalytics to run smoothly a range False positives need to be handled with greater care. For example, doof skillsets are needed. There is a not identify an error as fraud and fraud as an error. Both of these haveneed for technical, process SMEs,subject area SMEs, analysts, project a very high costmanagers and decision makers fora predictive analytics project to be Prioritize your output, since you do not want too much information torun well. Smaller projects may use read through, but want the right information.as little as an analyst to get started.If the work going into turningdata into actionable information
  8. 8. Predictive analytics holds great of other analytics in the future, such be predictive analytics incorporatedpromise for government agencies, as entity, social network and content into processes and tasks thatNathan states: analytics to give a more rich picture we are not actively aware of.” of the predictions and a higher“Generally speaking, analytics will degree of precision and accuracy.” Predictive analytics certainly holdsbe used in more processes to predict great promise for governmentoutcomes with a greater degree of Nathan also believes that new groups agencies. As government agenciesaccuracy and less false positives. of professionals, such as human are challenged to think of newAdditionally, predictive analytics resources workers, politicians, and innovative ways to deliverwill become more real time and and judges, will use predictive on services, predictive analyticsinvolve more datasets (internal analytics for a larger set of use cases offers a way forward to transformand external to the government and to make informed decisions. agency wide service delivery.agency) and go more mobile.” Finally, Nathan states, “Government If you are interested in learningHe continued, “The main drivers of workers in the future will have more more about predictive analytics,this is the decreasing cost of units access to predictive analytics “at be sure to check out some of theof storage, computing speed and their finger tips” and the analyst role following resources that GovLoopdisplays. In addition, predictive will be more pervasive and user- and IBM offer surroundinganalytics will incorporate more forms friendly. At a certain point there will predictive analytics.IBM Resources: Miami Dade - Improving Government Systems with Cognos on z - IBM Client Reference Video How Big Data is Changing the World :Jeff Jonas IBM New York State Tax: Smarter Planet Leadership Series Video IBM LS NY state Tax IBM Government Industry Framework for Social Services Demo Alameda County Social Services - IBM Smarter Planet Leadership Series VideoGovLoop Resources: IBM Report Highlights the Power of Predictive Analytics Understanding Customers Through Predictive Analytics IBM’s Charles Prow Discusses Strategies to Enhance National Competitiveness Analytics to Outcomes
  9. 9. About IBMThe world isn’t just getting smaller and flatter, it is also becoming more instrumented, inter- con-nected and intelligent. As we move toward a globally integrated economy, all types of governments arealso getting smarter.IBM provides a broad range of citizen centered solutions to help governments at all levels becomemore responsive to constituents, improve operational efficiencies, transform processes, man- age costsand collaborate with internal and external partners in a safe and secure environment.Governments can leverage the unparalleled resources of IBM through IBM Research, the Center forthe Business of Government, the Institute for Electronic Government and a far-reaching ecosystem ofstrategic relationships. To learn more, visit ibm.com/government.About GovLoopGovLoop’s mission is to “Connect government to improve government.” We aim to inspire publicsector professionals by serving as the knowledge network for government. GovLoop connects morethan 60,000 members, fostering cross-government collaboration, solving common problems and ad-vancing government careers. GovLoop is headquartered in Washington D.C with a team of dedicatedprofessionals who share a commitment to connect and improve government.For more information about predictive analytics and this report, please reach out to Pat Fiorenza,GovLoop Research Analyst, at pat@govloop.com. This report was designed by Cat Robinson, Gov-Loop Design Fellow.GovLoop734 15th St NW, Suite 500Washington, DC 20005Phone: (202) 407-7421Fax: (202) 407-7501