Real-Time Decisions, Not Real-Time Modeling

One of the most common problems in adopting EDM is the misuse of the phrase "real time."  Many organizations believe that embedding decision services into real-time systems, such as Web sites or call center applications, means real-time optimization or real-time analytics.

In fact, real-time analytics or real-time optimization are rarely required for real-time decisions.  Typically, offline analysis of data and construction of models, offline implementation of optimization models, and simulation of transactions are sufficient and more effective.  Real-time calculation of complex algorithms for predictive analytics or use of solvers for optimization is high cost and high risk.  These algorithms use a lot of processing power and access a lot of data.  Without some expert supervision, these tools can fail to converge on a solution quickly or even produce contradictory data.

These drawbacks make IT departments reluctant to use these techniques in operational systems, and rightly so.  Generally, using them offline to develop rules or equations that can perform efficiently at runtime is much preferred.decisions.