The Essentials of Descriptive Analytics: A Beginner's Guide

Data analytics can be broken into four key types:

• 1. Descriptive, which answers the question, “What happened?”
• 2. Diagnostic, which answers the question, “Why did this happen?”
• 3. Predictive, which answers the question, “What might happen in the future?”
• 4. Prescriptive, which answers the question, “What should we do next?”

4 Modes of Analytics

If your business runs on data, you need analytics to turn it into a competitive advantage. Learn the difference between these four types of analytics.

Descriptive

Gives an account of what has already occurred over the past days, months and years.

Diagnostic

Looks at why something happened: What went wrong and what went right?

Predictive

Looks at what might happen in the future based on past results, driving future outcomes.

Prescriptive

Provides guidance on what next.

Descriptive Analytics - Establishes the “what”:

This type of analytics refers to the collection, organisation, and presentation of historical data based on what has happened in the past. This can help businesses in enhancing their digital capabilities and the pace at which they respond to newer challenges. Descriptive analytics uses measures of frequency, central tendency, dispersion, variation, position and using a combination of our tabulation, reporting trends, visualization tools to establish exactly what happened.

Our process

Begins with establishing the KPIs/metrics, collecting relevant data and store in a database, data warehouse, or data lake. This is followed by data preparation, processing, and analysis to find patterns. The inferences, patterns, or trends are presented using our available data visualization and business intelligence solutions.

What can it tell you about

Track your business' performance over time, and in comparison, to the market. Processes valuable data and information to provide insights into:

• Historical trends: Comparing various parameters over a period, gain insight into historical trend. Calculate quarterly, monthly, and annual revenue growth as a percentage and compare it with previous time periods, your business can analyse sales growth.
• Current business performance: Monitor crucial metrics relating to departments, groups, individuals, and business overall.
• Virtues and shortcomings: Tap into real-time interactive dashboards to compare the performance of different groups based on a set of metrics (revenue and expenses, industry averages, market position, etc.) to identify virtues and shortcomings.

Descriptive Analytics - A crucial asset for business leaders across industries

Descriptive analytics serves as the starting point for any business. Any business that wants to decode and make sense of mountains of data by understanding past events must invest in the power of descriptive analytics. Prevent future slip-ups, ensure better results, and enables better decision-making at every level and department of an organisation. Let us look at a few examples:

• Your finance team can use descriptive analytics to track growth or decline in your monthly and yearly revenues.
• The marketing team can discover which social media platforms or campaigns delivered the best ROI during a particular period.
• Descriptive analytics makes tracking the varied demand for different SKUs across various locations possible for the operations department.
• The sales team can learn which customer segment generated the highest sales figures in the past.
• Based on such function-specific applications of descriptive analytics, department heads or business leaders can make more informed choices about the future.

How IN22 Labs can help you leverage the power of descriptive analytics?

With a relentless focus on augmenting business outcomes, IN22 Labs combines the untapped potential of your data with our proven domain expertise and industry-leading technologies. We take a proactive and custom metric-driven approach, enabling you to manage risks and ensure sustainability in the short and long run. Learn how our range of analytics services and solutions — from model development to support, maintenance and enhancements, and statistics/data science — can help drive your businesses. Schedule a demo with us today!