Applied Predictive Technologies
||This article appears to be written like an advertisement. (August 2010)|
|Industry||Software as a service|
|Headquarters||Arlington, Virginia, United States|
Applied Predictive Technologies (APT) is a software company that provides business analytics software, designed to help large, consumer-facing businesses "reduce the risk of any new initiative by systematically testing the idea with a subset of stores, customers, or employees." APT argues that using systematic testing enables companies to measure the true incremental impact of any new initiative. Its "core value proposition is helping clients innovate more effectively through trial and error."
APT was founded in 1999 by business consultanting executives Jim Manzi (Oliver Wyman), Anthony Bruce (McKinsey & Company), and Scott Setrakian (Oliver Wyman). Of founding APT, Manzi explained to The Washington Post that "a lot of the work I was doing as a consultant was very repetitive. I realized how much of it could be put into a software model.” With venture capital from Devon Partners, it took Manzi and Bruce less than a year to develop and launch APT’s software tool. In 2006, the firm was acquired by Accel-KKR, a private equity firm. In 2013, Goldman Sachs invested $100 million in APT.
APT is headquartered in Arlington, Virginia and has regional offices in San Francisco, London, and Taipei. APT employs more than 200 people across its four offices.
Like many major consulting companies (Boston Consulting Group or McKinsey), APT trends towards recruiting undergraduate students directly out of college, rather than targeting MBAs. "We found that hiring straight out of undergrad, we capture the capabilities that these top students have right as they're entering the workplace. It is an opportunity for us to develop them within our own walls," says Cathy Baker, SVP of marketing and administration.
APT's campus recruiting efforts focus in on a small number of target schools, so as to be able to identify candidates early on and develop a relationship with them over the course of their college career. Often, this relationship can begin as early as the students’ sophomore or junior year since APT recruits on campus for their summer interns. The internship program is designed so that if the student performs well, full time offers may be extended.
On the other hand, lateral recruiting at APT is an ongoing process that occurs throughout the year. Like campus recruits, lateral (experienced) candidates are expected to have a solid academic background, high GPA, rigorous course load, superior test scores and an impressive work history . Also like campus hires, lateral candidates must perform well on their analytical/quantitative skills during the interviews. The interview process can be extensive and may include three rounds totaling about eight to ten interviews.
APT's software takes a statistically rigorous test and learn approach to business analytics, in which proposed changes are tried out on a small scale and then analyzed before being implemented everywhere. APT's approach is follows a larger business trend, evidence-based management, in which the scientific method is applied to business decision making. APT's software automates the cycle described by the Harvard Business Review:
- Create a hypothesis
- Design a test to gather information about the hypothesis
- Execute the test
- Analyze the test to determine how successful it was and what factors explain performance differences
- Plan the rollout based on the analysis of the test
APT's software has been noted for its emphasis on ease of use in test design and analysis and also for its ability to present both a high-level summary of a test and deep analysis of the specific attributes that affect performance in the test. APT differentiates itself from competitors by offering a unique approach, emphasizing conducting tests to gather data instead of simply simulating it.
In February 2011, APT was awarded a patent that protects its core analytic technology for designing an in-market test and on matching test stores to control stores.
APT sells a number of products, each focused on a particular area of analysis. Test and Learn for Sites is APT's flagship product. APT provides its products as web applications using the software as a service model: companies connect to APT's web servers using login information provided by APT, the computations are run on the servers, and options and results are displayed in the user's web browser. APT's current products include:
- Test and Learn for Sites (focused on analyzing remodelings, sales promotions, pricing strategies, and other changes made at the store level),
- Test and Learn for Customers (focused on analyzing direct marketing and other customer offers),
- Network Planner,
- Market Basket Analyzer,
- Merchandise Optimization,
- Menu Optimization,
- Test and Learn for Ads.
Recently named one of the top 10 tech companies to watch in 2012 by American Banker, APT's clients span a wide range of industries and include Abercrombie & Fitch, Wendy's, Starbucks, Subway, Kraft Foods, Royal Bank of Canada, and more than 40 of the Fortune 500. APT's Test and Learn for Sites software has been used for Wawa's tests on adding personnel, IHG's tests on capital upgrades and promotional offers, and Royal Bank of Canada's in-market tests on distribution operations strategies. APT has also done work with Google in analyzing the impact of online advertising on brick and mortar stores.
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