Types of Analytics Overview
Data analysts solve various problems for businesses of different types depending on what the business needs. Some of the most common types of analytical analysis are:
- Descriptive Analytics
- Diagnostic Analytics
- Predictive Analytics
- Prescriptive Analytics
Generally speaking, it is harder to gain insights on future and it is also harder to understand how or why those events would happen. For that reason, the types of analytics are ordered from the easiest to the hardest based on the type of insights the analysis type is trying to find.
Descriptive Analytics
Key Focus: Observation
Question: What happened?
Objective: Providing a summary or overview of historical or current data to understand patterns and trends.
Diagnostic Analytics
Key Focus: Explained Reason
Question: Why did it happen?
Objective: Diving deeper into understanding the cause of historical or current outcomes by identifying patterns & relationships.
Predictive Analytics
Key Focus: Correlation
Question: What will happen?
Objective: Utilizing statistical models & algorithms to predict future outcomes based on historical data enabling potential proactive decision making.
Prescriptive Analytics
Key Focus: Causal/Manipulate
Question: How can we make it happen?
Objective: Recommending actions or interventions to optimize future outcomes to achieved the desire results from predictive models allowing decision makers to take the best course of action.