The Power of Data Analysis
Data analysis is now a core component of business intelligence and the benefits are undeniable. It reduces time between insight and action. It enables decision-makers to find their own answers. Advanced analytics are empowering people at all business levels to act with confidence. Below is a brief overview of four phases to execute and wield the power of data for your organization.
Phase I: Discover What is Happening
Descriptive analytics focuses on what happened or didn’t happen in the past. Data analysis identifies trends and patterns in your business and industry. Mining the data can help you draw a road map of the buzz among your customers so you know how to join the conversation.
Phase II: Determine Why It’s Happening
Diagnostic analytics is an exploration phase. This is when you get to the causes, correlations, and key factors that may have resulted in a particular outcome. Data analysis helps you see what is directly or indirectly affecting your business. This phase forms a good foundation for creating a data analytics strategy.
Phase III: Predict What’s Likely to Happen Next
Predictive analytics cannot tell you the future, but identifying probabilities helps you gain the upper hand. Mathematical equations, algorithms, and statistical analysis create models that can help you identify likelihoods. If you anticipate what will likely happen, you can adjust at both the micro and macro levels. These adjustments can help mitigate risk and take advantage of future opportunities.
Phase IV: Prescribe the Best Action to Take
Prescriptive analytics melds the previous phases into one custom path for your company. It lays out what actions to take and the pros and cons of each. This step utilizes “what if” scenarios, rules, and decision logic to identify your best option for taking advantage of opportunities. That option factors in both the benefits and drawbacks of your plan. During this phase you are able to optimize your processes and make the right decisions. This puts you in a much better position to meet goals, increase customer loyalty and avoid threats.
Keep In Mind…
Executing the four phases simultaneously is will work against you. Each phase depends on successful completion of the one that precedes it. Analytic solutions can give you a competitive edge, but you need to understand your data correctly before you can change the game.