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Hootfolio is a new company that was created by spinning off part of NEC’s business and providing a service called “causal analysis” that explores and analyzes causal relationships from data.
Causal analysis uses NEC’s AI technology, “causal analysis technology.” It automatically extracts causal structures from various data, which were previously analyzed manually based on hypotheses
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Hootfolio says that “examining whether something has a causal relationship is important for business,” and gives the example of sales of laundry detergent and beer. “While there is a correlation between sales of both, with sales increasing during the hot summer months, there is no causal relationship because increasing sales of one does not affect sales of the other,” the company says.
The main benefits of causal analysis are that it can reduce the time required for trial and error in analysis, and that it makes it possible to explore causal relationships, including indirect effects, between a large number of factors that are difficult to find manually. “The quality of analysis improves because it makes it possible to analyze data without relying on the analyst’s subjectivity,” the company said.
The company says this will improve on the conventional process of data analysts defining causal relationships and verifying those relationships. “Previously, we had to manually create hypotheses about causal relationships, and when there were a lot of variables, the number of combinations became too great to handle. Many scenarios, such as user behavior analysis, have more than dozens of variables. It is not uncommon for them to exceed 100,” the company said.
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