Descriptive, Diagnostic, Predictive, and Prescriptive Analytics Explained
Written by: CCG Analytics
With the overwhelming availability of information made possible by Big Data, more and more companies are turning to analytics and advanced analytics solutions to extract the right, most insightful information from huge volumes of data to help improve decision making and give themselves a competitive edge.
But such bountiful information has also given way to types of analytics, all of which play an important part in the decision-making process. So here, we’ll breakdown each – descriptive, diagnostic, predictive and prescriptive analytics – so you can adopt a program to collect and leverage the right information to make the right decisions at the right time to make more informed decisions.
Data For Today: Benchmarking & Measuring
These analytics serve to benchmark and measure current information at an aggregate level, so you know exactly what is going on in your company.
Using data aggregation and data mining techniques to reveal what has happened in different areas of your business, descriptive analytics provide a full picture of your organization and can focus your energy on improving performance.
Descriptive analytics answer the question, “What has happened?”
Using drill-down, data discovery, data mining and correlations, diagnostic analytics monitor performance and provide actionable information to craft remediation strategies for under-performing areas of the business.
Diagnostic analytics answer the question, “What is happening?”
Data For Tomorrow: Forecasting & Planning
These advanced analytics serve to forecast and plan for the future, fill in the information that you currently don’t have, and provide advice on what action to take next.
Using statistical models and forecasting to predict how your business could perform in the future based on past performance, predictive analytics help inform key decisions that propel you forward.
Predictive analytics answer the question, “What could happen?”
Using optimization and simulation algorithms to prescribe a solution for how your business can improve moving forward, prescriptive analytics inform decisions on where to deploy your resources.
Prescriptive analytics answer the question, “What should happen?”
Analytics In Action
The faster you can see data, the faster you can make an impact and stay competitive in your market. Rooms To Go, the 25th largest importer into the U.S. by volume, receives nearly 70,000 shipments of product a year into six distribution centers. With such a massive operation supporting countless product lines, products and variations, knowing how much of each product to have, where it should go and when it has to arrive is a very complex undertaking – one where mistakes prove costly.
As such, Rooms To Go needed to develop and deploy an analytics solution that allowed buyers to easily see and manipulate data so they could better manage the supply chain. With a sophisticated supply chain model that combined historic data with predictive analytics to show users at a glance when and where inventory was going to exceed capacity or fall short, the company was able to take proactive measures to divert a capacity crisis, ultimately saving them from potential losses.
Put Data To Work For You
At CCG, our analytics experts can help your organization implement reliable, secure dashboards and scorecards that deliver real-time key performance indicators and visual analytics on a single, consumable canvas. Our advanced analytics solutions leverage existing business intelligence tools to help you make it easier to plan for the future and optimize for today.
Contact us to schedule your business analytics discovery workshop to experience the CCG difference today.