Predictive analytics is the use of statistical models, machine learning algorithms, and historical data patterns to generate probability-based forecasts of future events or outcomes. Predictive analytics goes beyond describing what happened (descriptive analytics) or summarising historical performance to project what is likely to happen, enabling organisations to anticipate demand, identify at-risk customers or processes, and make proactive decisions based on expected future states rather than only reacting to past results.
Why This Matters
Predictive analytics shifts the decision-making orientation from reactive to proactive. When organisations can reliably anticipate what is likely to happen — whether in revenue, demand, costs, or operational performance — they can position resources and responses in advance rather than scrambling to react after the fact. This predictive capability is particularly valuable in volatile or fast-changing environments where the gap between a leading indicator and its business impact is short enough to act within.
Where This Fits
This term sits within the BI & AI area of Performance & Control.
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