If you are on CSE stack portal, there’s a good chance that you are already well acquainted with the general terms like ‘Data Analytics’, ‘Big Data’ and ‘Business Intelligence’ lead to different things in different circumstances. But have you thought what would be the right BI platform to hack through a wide number of solutions for business success?
In this article, I will knuckle down disambiguating the term ‘Data Analytics’ by splitting it down into 4 different types and aligning them with decision-making objectives.
Descriptive Analytics: What happened?
The commonest of the common type of Analytics, Descriptive Analytics offers the analyst a comprehensive view of key metrics and measures within an organization. It analyses the data available in real-time as well as historical data to derive meaningful insights regarding the future of a company. The main aim of this basic type of analytics is to discover the reasons behind pretentious success or failure in the past, as a result it is also known as ‘Reporting Bedrock’.
A business learns from its past behaviors, and draws inceptions based on those observations about its future outcomes, how they are going to affect. Descriptive Analytics is clouted the best when a business is on its way to understand the overall performance of the organization at an aggregate level and perceive the various aspects.
The best example of this would be a profit and loss statement. In the same way, analysts can possess data on a huge population of customers – delving deeper into mastering the demographic information of these customers can be classified as ‘descriptive analytics’.
Diagnostic Analytics: What made it happen?
The next stop to understand the intricacies of Data Analytics after Descriptive Analytics is Diagnostic Analytics. After assessing descriptive data, brilliant diagnostic analytical tools enable an analyst to go deeper into the problem, with the help of drilldowns and queries to eradicate the root-cause of the trouble. In simple words, in this analytics, historical data are ascertained against other data to reveal the answer of the question ‘why it happened’.
With Diagnostic Analytics, the companies are now able to make breakthroughs, to pick out the dependencies and to discern patterns. Organizations prefer this type of analytics as it gives them a deeper perception regarding a specific problem. On the other hand, the organizations should keep all the detailed information by their side, otherwise data collection may turn out to be time-consuming.
Effectively designed, well-integrated Business Information (BI) dashboards that assimilate the readings of time-series data, and participating filters and drilldown capabilities are deemed perfect for such analysis.
Predictive Analytics: What is going to happen?
It is all in the right predictions. Predictive Analytics involve analysis of past data patterns and trends to accurately forecast the future business outcome. It helps in determining realistic goals for the company and its effective execution and moderating expectations, by manipulating the findings of Descriptive and Diagnostic Analytics.
Thanks to Predictive Analytics, as it is now easy to identify tendencies, clusters and exceptions, while predicting future trends – all of this makes this analytics an extremely valuable tool of help. By employing numerous machine learning algorithms and statistical approaches, Insight Analytics eventually predicts the likelihood of an event happening in the future, but remember, these assumptions are based on predictions and probabilities, hence not 100% accurate.
Big conglomerates like Amazon and Walmart leverage this high-in-value type of analytics to decipher future sales trend, customer behaviors, purchase patterns and lot more.
Prescriptive Analytics: What is to be done?
This is where Big Data and Artificial Intelligence gets into action. The main objective of Prescriptive Analytics is to prescribe what action is to be taken to address the future problem. It is the next stop after Predictive Analytics to help business understand the underlying reasons of complications and devise the best of course of action.
It shares insights on possible results and outcomes that eventually maximize chief business metrics. It works by combining mathematical models, data and numerous business rules. The data can be external as well as internal, while business rules are boundaries, preferences, best practices and other restraints. Machine learning, natural language processing, operations research and statistics area few examples of mathematical models.
Though complex in nature, Prescriptive Analytics when used by companies can have a huge impact on the overall operations and future business growth. The best example of this type of analytics is a traffic application that enables you to select the easiest route to home, after paying attention to the distance of the route, the speed of travelling and prevailing traffic constraints in the city you are travelling.
The current trends highlight that an increasing number of companies are appreciating Big Data solutions and looking forward to Data Analytics implementation.However, it is just that they should select the right type of analytics solutions to enhance ROI, increase service quality and lessen operational costs. Do you have any other information or thought on this topic? Feel free to share with us by commenting below.