Data analytics is the broad process of analyzing raw data for trends and insights to answer questions. There are different types of data analysis that are each used for specific purposes; when combined, they can also provide a holistic understanding of and path of action for a problem. Analytics has many applications as it is a useful tool for making better-informed decisions.
Descriptive analytics summarizes large datasets into conclusions, develops key performance indicators (KPIs) to track outcomes, and collects relevant data to provide insight into past performance to provide answers as to what happened in a data set. Diagnostic analytics supplements basic descriptive data to find root causes and identifies unexpected changes in a metric; it allows people to understand how something happened.
Predictive analytics uses historical data to evaluate whether the trends will occur, provides valuable insights into future events, and utilizes statistical and machine learning techniques to predict what will happen. Statistical and machine learning techniques include neural networks, decision trees, and regression. Prescriptive analytics obtains insights from predictive analytics to make data-driven decisions, relies on machine learning and big datasets to find patterns, and helps people make decisions in the face of uncertainty. It offers answers as to what should be done.
Data analytics is adopted by a broad spectrum of fields and industries such as the banking and financial sectors make heavy use of analytics to optimize efficiency, predict market trends, assess risk, and detect and prevent fraud. Raw data is processed to gain insight into various areas that will allow for a better-informed decision. Credit scores are an example of data analytics where data points are used to determine lending risk.
In healthcare, analytics is applied to predict patient outcomes, allocate funding, and improve diagnostic techniques. A branch of data analytics, machine learning, features in the pharmaceutical industry to aid in drug discovery. Pharmaceutical companies also use analytics to explore the drug market and predict sales.
“In an ever digitalized world where more information is available than ever before, data analytics offers a chance to understand and process this chaos and be more efficient.”
Masterindatascience. (February 2021). What is data analytics? Retrieved from https://www.mastersindatascience.org/learning/what-is-data-analytics/
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