Day 5: Diagnostic Analytics - Understanding Why

Welcome to Day 5 of our series on Data Analytics in Business. Today, we’ll explore diagnostic analytics, which takes us a step further into the data.

Diagnostic analytics seeks to understand why something happened. It’s like a doctor diagnosing a patient. The doctor uses symptoms (descriptive analytics) to identify the disease (diagnostic analytics).

In business, diagnostic analytics often involves more sophisticated techniques such as drill-down, data discovery, correlations, and data mining. For example, if a company’s sales dropped in the last quarter (descriptive analytics), diagnostic analytics would delve into the data to find the cause. Was it due to a particular product line, a specific region, or a certain period?

By understanding the ‘why’ behind the data, businesses can learn from past performance and make better decisions. Tomorrow, we’ll look at predictive analytics, which takes us from understanding the past and present to predicting the future. Stay tuned!