Written byRuchir DahalonJuly 19, 2022
According to Wikipedia, data analysis is a process of inspecting, cleansing, transforming, and modelling data with the goal of discovering useful information, informing conclusions, and supporting decision-making.
Data is crucial to making informed business decisions, but only if you have the right analysis methods to transform raw data into actionable information.
Every day new data finds its way to the web on the scale of zettabytes. Most of it ends up in repositories where it gathers the metaphorical dust, never seeing the light of day.
Data is as good as the insights derived from it.
Once you make up your mind and decide to use data to bolster your decision-making process, you might be tempted to believe that half the battle is won. Far from it.
Since there is no universal way to perform data analysis owing to the ambiguity associated with the sourcing, analysis, and interpretation of data, businesses must look at this process strategically, in detail.
Five steps to superior data analysis
The data analysis procedure starts with a problem statement and ends with actionable insights. Each step is as valuable as the next. Failure to internalize one step may lead to the deterioration of the entire process. So, we recommend that you pay heed to every step with equal esteem.
Let’s go over the steps one at a time.
1. Define the objective
Before delving into data analysis, formulate key questions that you are seeking the answers to.
- Why has productivity taken a nosedive in my organization?
- Is there a correlation between sales and brand reputation? If so, to what extent?
- Are the customers looking for a particular kind of product?
Once you have adequately defined the problem statement, you can then begin to draft a working hypothesis that you can test along the way. Defining the objective will help you determine the sources you can extract data from, metrics you can measure, and the techniques you can use to run your analysis.
2. Procure the data
Once the pressing question is defined, you can then move on to procuring the data. Considering the nature of the data sources will ultimately define the validity of your analysis, it is advisable to spend a good amount of time finding reliable sources.
Generally, data collection begins with internal sources and moves on to external sources. Data collected from internal sources is gathered from within the company whereas data collected from your clients and competitors (or any other source outside your organization) falls under external sources.
- Customer Relationship Management software
- Internal database
- Sales Analysis report
- Enterprise Resource Planning software
- And many more…
- Google public data
- Social media data
- Government websites
- Industry websites
- Review websites
- And many more…
In the age of Big Data, it is becoming increasingly common to extract data from secondary sources to reinforce the data analysis process. While the decision to go beyond primary sources rests solely on your shoulders, doing so can take your analysis to a whole another level.
If you need to collect vast volumes of data from diverse sources on the internet, you can always avail our Concierge services, which will help you get all the data you need in a hassle-free manner.
3. Make sure that data is clean
If your data is contaminated, you might as well stop the process right here, because everything you do hitherto will be nothing more than a zero-sum game, or worse!
We’ve repeated time and again the negative consequences bad data can have on your business. For, as is accepted worldwide, bad data is no better than no data.
Bad data is no better than no data.Mel Netzhammer, Washington State University
It is not uncommon to find missing fields in a dataset. Not to mention faulty entries and outdated data. At Grepsr, we use best industry practices like data normalization to ensure the integrity of your data. Moreover, our QA team with its proven track record implements strict guidelines to get rid of all the bad apples.
4. Start analyzing the data
Once you’ve made sure that your data is clean, you can start analyzing it! If you are working with a relatively small amount of quantitative data then you can use common tools like Microsoft Excel, Tableau, and Google Data Studio for statistical analysis of your data.
But for more complex applications with various types of data you can use the following techniques:
- Regression analysis
- Monte Carlo simulation
- Predictive analysis
- Prescriptive analysis
- Fuzzy logic
- Factor analysis
- Sentiment Analysis
- Cohort Analysis
Data analysts apply various kinds of analysis methods on your dataset to connect the dots in your strategy. Learn all about it here.
5. Share the insights
The data has been collected, cleaned, and analyzed. Now it’s time to share it with the rest of the team. This is when all the hard work you put into your data analysis finally begins to bear fruit.
You can use data visualization tools to make it visually appealing and easy to deduce. Or in other words, by using the power of data storytelling you can rally the entire team to achieve a particular goal with the insights gained from this exercise.
Keep in mind that you should not look to confirm your hypothesis but accept whatever the result dictates.
Ask yourself the following questions:
- Does the data answer the question you asked in the beginning? How?
- Does the data enable you to make safe decisions? How?
- Are there more perspectives yet to be considered?
If your findings stand strong against all these questions, you are most likely headed in the right direction.
This way, you can effectively utilize your data, whether it’s for a straightforward analysis or machine learning applications.
If there’s one thing you take away from this article it’d be to make sure that the data you collect is of the highest order. Then as per your need, you can choose the best data analysis process to glean actionable insights.
Data extraction, data analysis, or data visualization. The one thing common in all these terms is data, and you must work with the highest quality, from the get-go. For that, you can always count on Grepsr!