INTRODUCTION

Data: facts and statistics collected together for reference or analysis.

Analytics: the systematic computational analysis of data or statistics.
Data analytics is the process of collecting, transforming, and
organizing data in order to draw conclusions, make predictions, and
drive informed decision making.
The field encompasses data analysis, data science, and data
engineering.
Data analytics is a multidisciplinary field that employs a wide range of
analysis techniques, including math, statistics, and computer science,
to draw insights from data sets. Data analytics is a broad term that
includes everything from simply analyzing data to theorizing ways of
collecting data and creating the frameworks needed to store it.

How is data analytics used? Data analytics examples

Data is everywhere, and people use data every day, whether they
realize it or not. Daily tasks such as measuring coffee beans to make
your morning cup, checking the weather report before deciding what
to wear, or tracking your steps throughout the day with a fitness
tracker can all be forms of analyzing and using data.
Data is also crucial in a professional sense. Organizations that use data
to drive business strategies often find that they are more confident,
proactive, and financially savvy. As a result, data analytics is important
across many industries. A sneaker manufacturer might look at sales
data to determine which designs to continue and which to retire, or
a health care administrator may look at inventory data to determine
the medical supplies they should order.
 Steps in Data Analysis
Six Sigma is a set of The process involved in data analysis involves
techniques and tools
used to improve several steps:
business processes. 1. Determine the data requirements or how
The Six Sigma method the data is grouped. Data may be separated
uses a step-by-step
by age, demographic, income, or gender.
approach called
DMAIC Data values may be numerical or divided by
category.
Define
A team of people, led 2. Collect the data. This can be done through a
by a Six Sigma expert, variety of sources such as computers, online
chooses a process to
focus on and defines sources, cameras, environmental sources, or
the problem it wishes
through personnel.
to solve.
3. Organize the data after it's collected so it
Measure
can be analyzed. This may take place on a
The team measures the
initial performance of spreadsheet or other form of software that
the process, creating a
benchmark, and can take statistical data.
pinpoints a list of 4. Clean up the data before it is analyzed. This
inputs that may be
hindering is done by scrubbing it and ensuring there's
performance.
no duplication or error and that it is not
Analyze incomplete. This step helps correct any
Next the team analyzes
the process by errors before the data goes on to a data
isolating each input, or analyst to be analyzed.
potential reason for
any failures, and Types of Data Analytics
testing it as the
possible root of the Data analytics is broken down into four basic
problem. types:
Improve 1. Descriptive analytics: This describes what
The team works from has happened over a given period of time.
there to implement
changes that will
improve system
performance.

Control
The group adds
controls to the process
 Have the number of views gone up? Are sales stronger this
month than last?
2. Diagnostic analytics: This focuses more on why something
happened. It involves more diverse data inputs and a bit of
hypothesizing. Did the weather affect beer sales? Did that latest
marketing campaign impact sales?
3. Predictive analytics: This moves to what is likely going to
happen in the near term. What happened to sales the last time
we had a hot summer? How many weather models predict a hot
summer this year?
4. Prescriptive analytics: This suggests a course of action. For
example, we should add an evening shift to the brewery and
rent an additional tank to increase output if the likelihood of a
hot summer is measured as an average of these five weather
models and the average is above 58%,
Data analytics underpins many quality control systems in the
financial world, including the ever-popular Six Sigma program.

It's nearly impossible to optimize something if you aren’t properly

measuring it, whether it's your weight or the number of defects per
million in a production line.
The sectors that have adopted the use of data analytics include the
travel and hospitality industry where turnarounds can be quick. This
industry can collect customer data and figure out where problems, if
any, lie and how to fix them.
Healthcare combines the use of high volumes of structured and
unstructured data and uses data analytics to make quick decisions.
Similarly, the retail industry uses copious amounts of data to meet
the ever-changing demands of shoppers. The information that
retailers collect and analyze can help them identify trends,
recommend products, and increase profits.

Data Analytics Techniques

Data analysts can use several analytical methods and techniques to
process data and extract information. Some of the most popular
methods include:
 Regression Analysis: This entails analyzing the relationship
between one or more independent variables and a dependent
variable. The independent variables are used to explain the
dependent variable, showing how changes in the independent
variables influence the dependent variable. Eg we might want to
understand the growth of a population of bacteria over time.
The relationship between time and population growth may not
be linear, so a nonlinear regression model can be used to
capture the growth curve accurately
 Factor Analysis: This entails taking a complex dataset with
many variables and reducing the variables to a small number.
The goal of this maneuver is to attempt to discover hidden
trends that would otherwise have been more difficult to see. Eg
Employee and Customer Surveys
 Cohort Analysis: This is the process of breaking a data set into
groups of similar data, often into a customer demographic. This
allows data analysts and other users of data analytics to further
dive into the numbers relating to a specific subset of data.
Examples:
  Tracking app usage: Track how many new users return to
an app each day for a set period of time
 Analyzing email campaigns: Track how many people
purchase a product after receiving an email
 Comparing student cohorts: Compare the average income
of students who graduated in different years
 Analyzing gaming performance: Compare the performance
of expert gamers to new users to identify areas for
improvement
 Tracking patient outcomes: Track the treatment outcomes
and long-term prognosis of patients with a specific disease
 Monte Carlo Simulations: Models the probability of different
outcomes happening. They're often used for risk mitigation and
loss prevention. These simulations incorporate multiple values
and variables and often have greater forecasting capabilities
than other data analytics approaches.
Eg. Computer programs use this method to analyze past data
and predict a range of future outcomes based on a choice of
action. For example, if you want to estimate the first month's
sales of a new product, you can give the Monte Carlo simulation
program your historical sales data.
 Time Series Analysis: Tracks data over time and solidifies the
relationship between the value of a data point and the
occurrence of the data point. This data analysis technique is
usually used to spot cyclical trends or to project financial
forecasts.
Eg. Stock market analysis is an excellent example of time series
analysis in action, especially with automated trading algorithms.
 Likewise, time series analysis is ideal for forecasting weather
changes, helping meteorologists predict everything from
tomorrow's weather report to future years of climate change.

The Role of Data Analytics

Data analytics can enhance operations, efficiency, and performance
in numerous industries by shining a spotlight on patterns.
Implementing these techniques can give companies and businesses a
competitive edge. Let's take a look at the process of data analysis
divided into four basic steps.
1. Gathering Data
As the name suggests, this step involves collecting or gathering data
and information from across a broad spectrum of sources. Various
forms of information are then recreated into the same format so they
can eventually be analyzed. The process can take a good bit of time,
more than any other step.

2. Data Management
Data requires a database to contain, manage, and provide access to
the information tht has been gathered. The next step in data analytics
is therefore the creation of such a database to manage the
information.
While some people or organizations may store data in Microsoft Excel
spreadsheets, Excel is limited for this purpose and is more a tool for
basic analysis and calculations such as in finance. Relational
databases are a much better option than Excel for data storage. They
allow for the storage of much greater volumes of data, and allow for
efficient access. The relational structure allows for tables to easily be
used together. Structured Query Language, known by its initials SQL,
is the computer language used to work on and query from relational
databases. Created in 1979, SQL allows for easy interaction with
relational databases enabling datasets to be queried, built, and
analysized.3

3. Statistical Analysis
The third step is statistical analysis. It involves the interpretation of
the gathered and stored data into models that will hopefully reveal
trends that can be used to interpret future data. This is achieved
through open-source programming languages such as Python. More
specific tools for data analytics, like R, can be used for statistical
analysis or graphical modeling.

4. Data Presentation
The results of the data analytics process are meant to be shared. The
final step is formatting the data so it’s accessible to and
understandable by others, particularly those individuals within a
company who are responsible for growth, analysis, efficiency, and
operations. Having access can be beneficial to shareholders as well.

Importance and Uses of Data Analytics

Data analytics provide a critical component of a business’s probability
of success. Gathering, sorting, analyzing, and presenting information
can significantly enhance and benefit society, particularly in fields
such as healthcare and crime prevention. But the uses of data
analytics can be equally beneficial for small enterprises and startups
that are looking for an edge over the business next door, albeit on a
smaller scale,

Why Is Data Analytics Important?

Implementing data analytics into the business model means
companies can help reduce costs by identifying more efficient ways of
doing business. A company can also use data analytics to make better
business decisions.

What Are the 4 Types of Data Analytics?

Data analytics is broken down into four basic types. Descriptive
analytics describes what has happened over a given period .
Diagnostic analytics focuses more on why something happened.
Predictive analytics moves to what is likely going to happen in the
near term. Finally, prescriptive analytics suggests a course of action.

Who Uses Data Analytics?

Data analytics has been adopted by several sectors where
turnarounds can be quick, such as the travel and hospitality industry.
Healthcare is another sector that combines the use of high volumes of
structured and unstructured data, and data analytics can help in
making quick decisions. The retail industry also uses large amounts
of data to meet the ever-changing demands of shoppers.

The Bottom Line

Data analytics helps individuals and organizations make sure of their
data in a world that's increasingly becoming reliant on information
and gathering statistics. A set of raw numbers can be transformed
using a variety of tools and techniques, resulting in informative,
educational insights that drive decision-making and thoughtful
management.

Solving business problems using data analytics

Making business-defining decisions using data analytics

Data Analytics Framework

Data analytics framework is a structured approach or methodology that
guides the process of analyzing and interpreting data to derive meaningful
insights and make informed decisions. It provides a systematic way to
handle data, perform analysis, and extract valuable information from the
vast amount of data generated by organizations. Typically, a framework
consists of a set of tools, techniques, and best practices that guide the
entire data analysis process. The framework serves as a roadmap, ensuring
that organizations follow a consistent and efficient process in their data
analysis efforts.

Why do you need a data and analytics framework?

A data and analytics framework is crucial because it provides a
structured approach to collecting, analyzing, and interpreting data,
allowing organizations to extract valuable insights, make informed
decisions, optimize operations, and ultimately gain a competitive
advantage by leveraging their data effectively, all while ensuring
consistency, efficiency, and clear communication throughout the
process.

Types of Data Analytics Frameworks

There are various types of data analytics frameworks, each with its
own focus and objectives. Some commonly used frameworks include
descriptive analytics, diagnostic analytics, predictive analytics,
prescriptive analytics and cognitive analytics. Let’s explore each of
these frameworks in more detail:

1. Descriptive Analytics
Descriptive analytics is a branch of data analytics that focuses on
summarizing historical data to gain insights into past events or
phenomena. It involves organizing and presenting data in a
meaningful way through visualization techniques, such as charts,
graphs, and dashboards. Descriptive analytics aims to provide a clear
and concise snapshot of what has happened, allowing organizations to
understand patterns, trends, and key metrics. By analyzing
descriptive analytics, businesses can gain valuable insights into their
past performance, customer behavior, and market trends, which can
inform decision-making and help drive future strategies.

2. Diagnostic Analytics:
Diagnostic analytics is a form of data analytics that delves deeper into
understanding the root causes and reasons behind specific events or
outcomes. It goes beyond descriptive analytics by investigating the
relationships between variables to uncover insights and explanations.
Diagnostic analytics involves conducting exploratory analysis and
applying statistical techniques to identify patterns, correlations, and
anomalies within the data. By analyzing diagnostic analytics,
organizations can gain a comprehensive understanding of why certain
events occurred, enabling them to address underlying issues, optimize
processes, and make informed decisions to prevent similar
occurrences in the future.

3. Predictive Analytics:
Predictive analytics is a field within data analytics that employs
historical data and statistical modeling methods to predict future
outcomes or trends. Its objective is to make well-informed forecasts
and estimations based on the analysis of patterns, correlations, and
connections present in the data. By utilizing a range of statistical and
machine learning algorithms, predictive analytics creates predictive
models that enable organizations to anticipate customer behavior,
market trends, demand patterns, and other important factors. This
capability empowers businesses to proactively make decisions,
optimize the allocation of resources, manage risks effectively, and
gain a competitive edge by leveraging data-derived insights to shape
their future strategies and actions.

4. Prescriptive Analytics:
Prescriptive analytics is an advanced field in data analytics that
employs historical data, mathematical models, optimization
algorithms, and simulation methods to offer guidance on the best
actions or decisions to attain desired outcomes. Unlike descriptive
and predictive analytics, which concentrate on understanding past
occurrences and forecasting future trends, prescriptive analytics
takes an additional step by proposing precise courses of action. By
considering various limitations, goals, and potential situations,
prescriptive analytics enables organizations to make data-informed
choices that maximize the achievement of desired results. It supports
businesses to enhance operational efficiency, allocate resources
effectively, manage risks, and make well-informed decisions that drive
improved performance and a competitive edge.

5. Cognitive Analytics:
Cognitive analytics refers to the application of advanced technologies
and techniques that enable systems and machines to mimic human
cognitive abilities, such as perception, learning, reasoning, and
problem-solving. It combines elements of artificial intelligence,
machine learning, natural language processing, and other cognitive
computing technologies to analyze and interpret complex data sets.
Cognitive analytics goes beyond traditional data analysis by
incorporating context, understanding, and inference capabilities to
derive deeper insights and make more informed decisions. It enables
organizations to unveil patterns, trends, and relationships within large
volumes of structured and unstructured data, leading to improved
decision-making, enhanced customer experiences, and the discovery
of valuable business opportunities.
These five types of analytics frameworks are not mutually exclusive
and can often be combined to create more comprehensive analysis
approaches. Organizations can select and tailor a framework based on
their specific goals, data availability, and analytical capabilities.
In addition to these core frameworks, there are other considerations
within a data analytics framework, such as data collection, data
preprocessing, data exploration, and modeling techniques. These
elements ensure that the data is appropriately prepared, outliers and
missing values are addressed, and the most suitable analytical
methods are applied.
Data and analytics framework: tools and techniques
Key Tools:
 Data Visualization Tools:
Tableau, Power BI, which allow for interactive dashboards and
graphical representation of data to identify patterns and trends.
 Programming Languages:
Python, with libraries like Pandas and Matplotlib, for data
manipulation, analysis, and visualization.
 Statistical Software:
SAS, for advanced statistical analysis and predictive modeling.
 Spreadsheet Applications:
Microsoft Excel, for basic data cleaning, sorting, filtering, and
pivot tables.

Key Techniques:
 Descriptive Analytics:
Summarizing key metrics and trends from data using measures
like averages, counts, and frequencies.
 Diagnostic Analytics:
Exploring the "why" behind observed patterns by drilling down
into data to identify root causes.
 Predictive Analytics:
Using statistical models to forecast future trends and outcomes
based on historical data.
 Prescriptive Analytics:
Providing recommendations or actionable insights based on
predictive analysis to optimize decisions.
 Data Mining:
Discovering hidden patterns and relationships within large
datasets using techniques like clustering, association rule mining,
and decision trees.
 Time Series Analysis:
 Studying trends and seasonality in data that is collected over
time.
 Regression Analysis:
Identifying relationships between variables to predict changes in
one variable based on another.
 Natural Language Processing (NLP):
Analyzing unstructured text data like customer reviews to extract
sentiment and insights.

Data and Analytics Framework Stages:

 Data Collection:
Gathering data from various sources like databases, APIs, and
external systems.
 Data Cleaning:
Identifying and correcting errors, inconsistencies, and missing
values within the data.
 Data Transformation:
Structuring and preparing data for analysis by performing
operations like aggregation, normalization, and feature
engineering.
 Exploratory Data Analysis (EDA):
Visualizing and summarizing data to gain initial insights and
identify potential trends.
 Model Building and Analysis:
Applying statistical techniques or machine learning algorithms to
build predictive models.
 Data Visualization and Reporting:
Presenting insights through interactive dashboards, charts, and
graphs to effectively communicate findings to stakeholders.

Make better and faster decisions with data and analytics