Ty of Data Analysis

Types of data analysis

1) Descriptive analysis

This analysis measures what happened.

Examples of descriptive analytics:

-Actual financial statements

-KPIs

-Reporting the number of employees

2) Diagnostic analysis

The goal here is to understand what happened.

We used drill-downs, filtering, and 80/20 analysis to understand the root cause of what happened.

For example, doing a price and volume mix analysis of sales is also a diagnostic analysis.

3) Predictive analytics

This is a future study to predict what is likely to happen. It forecasts next month's cash flow or output based on statistical models, manually validated and then adjusted based on current business events.

4) Normative analysis

Here we analyze which factors should be used to achieve performance in a given scenario. This is the least used analysis as it is the most difficult analysis to implement.

It focuses on finding actionable insights based on a combination of diagnostic and predictive analytics.

An example would be a model suggesting the most cost and time-efficient means to activate on a website to convert more sales to increase weekly sales for a particular product.