Today, most organizations depend on data to drive business decisions, however, these data are meaningless until valuable insights are derived from them to make informed decisions.
The types of analytics that help derive insights from data include:
- Descriptive Analytics: This helps answer the question “What is happening?” by analyzing data and can be visualized using charts or graphs. It allows us to learn from past behaviors, and gives us some information on how to plan for the future.
- Diagnostic Analytics: This helps answer the question “Why is this happening?” by showing what variables are responsible for certain outcomes.
- Predictive Analytics: Based on previous trends and patterns, this is used to answer the question- “what is likely to happen in the future?”
- Prescriptive Analytics: After getting findings from the first 3 techniques, this helps to determine the best course of action to choose, bypass or eliminate future issues.
- Cognitive Analytics: This is the most advanced form of analytics that combines a number of intelligent technologies like artificial intelligence and more to process the information. It also draws inferences from existing data and patterns, to derive conclusions.
As the basic goal of analytics is to discover and understand data to take actions, these 5 types of analytics can help data-driven businesses choose which is best suited to their business needs.
Which one of these techniques are you most interested in and why?