Descriptive analytics is the most commonly used type of analytics by businesses and organizations. It provides reporting and analysis on past events and is used to understand overall performance at an aggregate level. It is the easiest place for a company to start, as data tends to be readily available to build reports and applications. This article will discuss the benefits of descriptive analytics, provide real-world examples, and explore the resources used.
Benefits of Descriptive Analytics
Understand past performance: Descriptive analytics helps organizations understand past performance by providing a clear and concise picture of what has happened. This can help organizations make better decisions by understanding their strengths and weaknesses.
Identify trends: Descriptive analytics allows organizations to identify trends over time, such as changes in demand or sales patterns. By identifying trends, organizations can make informed decisions about the future.
Monitor key performance indicators (KPIs): Descriptive analytics provides reporting and analysis on KPIs, allowing organizations to monitor their performance against targets and make adjustments as necessary.
Track operational performance: Descriptive analytics can be used to track operational performance, such as machine uptime and production rates. This allows organizations to identify areas for improvement and optimize their operations.
Improve decision-making: Descriptive analytics helps organizations make better decisions by providing a clear and concise picture of past performance. This allows organizations to identify areas for improvement and make informed decisions about the future.
Real-World Examples of Descriptive Analytics
Demand trends: A retail company can use descriptive analytics to analyze sales data and identify demand trends for specific products. This can help the company make informed decisions about inventory management and marketing campaigns.
KPI reporting: A manufacturing company can use descriptive analytics to monitor KPIs such as machine uptime, production, and defect rates. This allows the company to identify areas for improvement and optimize its operations.
Operational performance: An oil and gas company can use descriptive analytics to track operational performance, such as pipeline flow rates and pressure levels. This allows the company to identify potential issues before they become critical.
Sales reporting: A software company can use descriptive analytics to analyze sales data and identify customer acquisition and retention trends. This allows the company to make informed decisions about their sales strategy.
Financial reporting: A financial services company can use descriptive analytics to analyze financial data and generate reports on profitability, revenue, and expenses. This allows the company to identify areas for improvement and make informed decisions about its financial strategy.
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Ref:
“What is Descriptive Analytics and How Can You Use It?” by Andrew W. Looney, DZone.
“What is Descriptive Analytics?” by Margaret Rouse, TechTarget.
“Descriptive Analytics” by Dave Bourgeois and David T. Bourgeois, the University of Notre Dame.
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