Question

Picking an Analytic Approach to solve a problem is based on the type of question. Explain the given statement with suitable examples.

Hint:

Tip: Right question → Right method → Right action.

Answer 1

Selecting the right analytic approach depends on what kind of question you want to answer with your data.
Different problems require different techniques:
1. Descriptive Analytics answers “What has happened?”.
Example: A company uses descriptive analytics to create monthly sales reports showing total revenue and units sold.
2. Diagnostic Analytics answers “Why did it happen?”.
Example: If sales drop, diagnostic analytics finds the cause, such as seasonal trends or poor marketing.
3. Predictive Analytics answers “What is likely to happen?”.
Example: Using historical data to predict future customer demand for inventory planning.
4. Prescriptive Analytics answers “What should we do about it?”.
Example: An airline uses prescriptive analytics to optimize flight pricing and seat allocation.
By matching the analytic approach to the question, organizations can extract meaningful insights and make better decisions.
Choosing the wrong approach may waste time and lead to inaccurate conclusions.