No

YesNo

Yes

Longitudinal & Time Series

Cro

ss-S

ecti

onal

&

Pan

el D

ata

PEW Mobile Phone

Galton Children Height

Census

Text Sentiment

Old Faithful

Web Analytics

Titanic Survivors

Bank Loans

Job Classification

Stock Market

Predictive Modeling: Case Studies

• Old Faithful• Earthquakes• Flu

Old Faithful

Time Interval Between Eruptions

91.2

107.475.0

• 91.2 minutes between eruptions• 8.1 one standard deviation• 16.2 two standard deviations• 91.2 +/- 16.2 min 95%

107.4

75.0

Volume

Duration

Time Interval Until Next Eruptions

90

70

All predictions are made using a formula that takes into account the length of the previous eruption. The formula used has proven to be accurate, plus or minus 10 minutes, 90% of the time.

Sensor

CountdownClock

Down-hole video camera~22 m deep…

Old Faithful

• Visible, Measureable• Frequent• Repeatable• Single Geyser• Small Area, Same Place

Very Predictable

Non-Critical

Anything in the Business World that is similar?

• Manufacturing Processes -Statistical Process Control

Trends: Flu

Flu - Seasonal

• Annual, Seasonal• Consistent – sort of• Large Regional Area • Can be Critical• Semi-Predictable• Vaccine – Major Strains• Genetic Changes

plot(stl(beer,s.window="periodic"))

Time Series

Earthquakes

Earthquakes: “The Big One”

• Very Critical• Measureable: Seismograph• Large Earthquake Regions• Frequency

– Smaller Ones more Frequent– Big Ones less Frequent

Not Predictable

Very Critical