Descriptive

Analytics?
Lecture 10
Ms. Ushna Tasleem
Analytics:

 Analytics is a field of computer science that uses math,

statistics, and machine learning to find meaningful patterns in
data. Analytics – or data analytics – involves sifting through
massive data sets to discover, interpret, and share new
insights and knowledge.
What is business analytics?

 Business analytics is analytics applied to business data. It focuses on the

business implications of data – and the decisions and actions that should
be taken as a result.
Four Types of Analytics
Four Types of Analytics
 Descriptive Analytics sets the foundation for the other 3 types of
analytics—diagnostic, predictive, and prescriptive analytics. While
descriptive analytics focuses on summarizing past data to understand
what has happened,
 Diagnostic Analytics delves deeper to determine why something
happened by uncovering root causes and relationships.
 Predictive Analytics takes it a step further by using historical data
patterns and statistical models to forecast future outcomes.
 Lastly, Prescriptive Analytics utilizes insights from the previous types
to provide recommendations on the best course of action, optimizing
your decision-making processes.
 KPI stands for key
performance indicator,
What is Descriptive Analytics? a quantifiable measure
of performance over
time for a specific
objective.

 Descriptive analytics focuses on summarizing and interpreting

historical data to gain insights into events, patterns, and trends in
a business.
 It involves the exploration and examination of data through
various statistical techniques, visualizations, and KPI reports to
provide a clear understanding of what has happened.
 This provides you a foundation for decision-making, performance
evaluation, and operational improvements.
 It is the most common and fundamental form of analytics that companies use.
 Every part of the business can use descriptive analytics to keep tabs on
operational performance and monitor trends.
 Examples of descriptive analytics include KPIs such as year-on-year
percentage sales growth, revenue per customer and the average time
customers take to pay bills. The products of descriptive analytics appear in
financial statements, other reports, dashboards and presentations.
How Descriptive Analytics Works?
How Descriptive Analytics Works?
 Collect Data: First, you collect relevant data from various
operational sources, such as databases, spreadsheets, or data
warehouses. This data can include structured data such as
numerical values, categorical variables, as well as unstructured
data like text or images.
 Clean & Prep Data: You then clean and process this data to
ensure accuracy and consistency. This step involves handling
missing values, removing duplicates, and transforming the data
into a suitable format for analysis. This step can happen before
or after the data is loaded into a data repository.
 Explore Data: Apply exploratory data analysis techniques to
gain a better understanding of the dataset. This includes
examining summary statistics, distributions, and visualizations to
identify patterns, outliers, and relationships within the data.
How Descriptive Analytics Works?
 Summarize Data: Calculate descriptive statistics to summarize
the dataset, providing key metrics such as mean, median, mode,
standard deviation, and percentiles. These statistics offer a
concise overview of the dataset's central tendencies and
dispersion.
 Visualize Data: Create visual representations, such as charts,
graphs, and dashboards, to present the data in a visually
appealing and easily understandable format. Visualizations help
identify trends, patterns, and anomalies more intuitively.
 Interpret Data: Interpret the summarized data and
visualizations to extract meaningful insights and observations
about the past events and trends. This analysis enables
stakeholders to understand the data's implications and make
informed decisions based on the findings.
 Advantages:
• Provides a historical perspective: Descriptive analytics allows
businesses to gain insights into past events, patterns, and trends,
providing a valuable historical context for decision-making.
• Easy to understand and interpret: Summarized and visualized data
makes it accessible to a wide range of users, enabling easy understanding
and interpretation of the information.
• Facilitates data-driven decision-making: By analyzing and
summarizing data, it helps organizations make informed decisions based
on evidence rather than relying solely on intuition or guesswork.
• Identifies patterns and trends: It uncovers patterns and trends within
data, allowing businesses to identify opportunities, risks, and areas for
improvement.
• Supports performance evaluation: By providing metrics and key
performance indicators (KPIs), it aids in evaluating business performance,
measuring progress, and setting benchmarks.
 Disadvantages:
• Limited in terms of insights: It primarily focuses on summarizing
past data and may not provide in-depth insights into the underlying
causes or future predictions.
• Lack of context: It may present data without providing sufficient
context or explanations, requiring additional analysis and
interpretation to derive meaningful insights.
• Reactive rather than proactive: It deals with historical data, which
means it offers insights into past events but may not proactively
address future challenges or anticipate changes.
• Reliance on quality data: Accurate and high-quality data is crucial
and if the underlying data is incomplete, inaccurate, or biased, the
insights derived may be flawed or misleading.
• Potential oversimplification: Summarizing complex data into
simplified metrics and visualizations can oversimplify the intricacies of
the underlying information, potentially missing important nuances.
 Descriptive Analytics Examples
 Insurance: Analyzing historical claim data to identify patterns and trends in order
to assess risk and set insurance premiums accurately.
 Retail: Analyzing sales data from previous promotional campaigns to determine
which offers and strategies were most effective in driving customer purchases.
 Manufacturing: Analyzing production and quality data to identify factors that lead
to production failures, improve process efficiency, and enhance product quality.
 Public Sector: Analyzing public service utilization data to identify areas of high
demand, optimize resource allocation, and improve service delivery efficiency.
 Healthcare: Studying patient admission and readmission data to identify factors
and patterns that contribute to better patient care and optimize resource
allocation.
• Social media engagement: Descriptive analytics generates metrics that help
determine the return on social media initiatives, such as growth in followers,
engagement rates and revenue attributable to specific social media platforms.
• Surveys: Descriptive analytics produces summaries of internal and external survey
results, such as a net promoter score.
 What are descriptive analysis techniques?
 Descriptive analysis techniques encompass a range of methods used to
summarize and analyze data in order to gain insights into past events,
patterns, and trends. These techniques include statistical measures, data
visualization, and exploratory data analysis.
 Statistical measures, such as mean, median, mode, standard deviation, and
percentiles, provide numerical summaries of the data's central tendencies,
dispersion, and distribution.
 Data visualization techniques utilize charts, graphs, and dashboards to
visually represent the data, making it easier to understand and identify
patterns or anomalies.
 Exploratory data analysis involves analyzing summary statistics, distributions,
and visualizations to uncover relationships, correlations, and outliers within
the dataset.
 By employing these descriptive analysis techniques, businesses can
effectively summarize, present, and interpret their data, enabling better
decision-making and actionable insights based on historical information.
What tools are used in descriptive
analytics?
 Various tools are used to effectively analyze and summarize data. BI tools such as
Qlik Sense and Power BI provide the full range of capabilities, including statistical
analysis, data visualization, and data integration.
 Otherwise, statistical software packages like R, Python (with libraries such as
Pandas and NumPy), and SPSS are commonly employed to perform data
calculations, generate summary statistics, and conduct statistical tests.
 Data visualization tools like Tableau, Qlik, and matplotlib help in creating visually
appealing charts, graphs, and dashboards to present data in a clear and
understandable format.
 Database management systems such as SQL enable efficient data storage, retrieval,
and manipulation.
 Additionally, spreadsheet software like Microsoft Excel and Google Sheets are often
utilized for basic data analysis and visualization.
Summary

 Descriptive analytics is an essential technique that helps businesses

make sense of vast amounts of historical data.
 It helps you monitor performance and trends by tracking KPIs and
other metrics.
 By combining descriptive analytics with diagnostic, predictive and
prescriptive analysis, companies can gain deeper insights into the
causes and likely future outcomes of events, as well as the potential
actions they can take to improve business performance.
 Companies use descriptive analytics to track everyday operations.
 Company reports tracking inventory, workflow, sales and revenue are all examples
of descriptive analytics. Other examples include KPIs and metrics used to measure
the performance of specific aspects of the business or the company overall.
Assignment- 3

 Descriptive Analysis of Students’ CGPA: A Case Study of Universiti Malaysia Pahang

 https://iopscience.iop.org/article/10.1088/1757-899X/469/1/012100/pdf
References

 https://www.qlik.com/us/reporting-analytics/descriptive-analytics
 https://www.linkedin.com/pulse/data-warehousing-analytics-mansoor-arif
 Business Process Improvement; The Breakthrough Strategy for Total Quality,
Productivity, and Competitiveness, H. J. Harrington
 Ch#2, Business Intelligence: A Managerial Approach by Turban, Sharda, Delen,
King, 2nd Edition, Prentice Hall (2011). ISBN: 13-978-0-136-10066-9
 Integrated Business Processes with ERP Systems , Simha R. Magal ,Jeffrey Word J O
H N W I L E Y & S O N S, I N C.
 https://iopscience.iop.org/article/10.1088/1757-899X/469/1/012100/pdf