A VISUAL

PERSPECTIVE OF
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BUSINESS ANALYTICS
STATISTICS
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Statistics is the science involved in the study of the

development of methods for collecting, analyzing,
interpreting and presenting data.

Statistical analysis is the process of collecting and

analyzing data to identify patterns and trends and
inform decision-making.
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What are the types of statistical analysis?
1. Descriptive statistics

Descriptive statistics is what organizations use to summarize their data. This type typically involves
summary charts, graphs and tables depicting the data for easier comprehension, rather than relying on raw,
unorganized data. Among some of the useful data that comes from descriptive statistics are the mode,
median and mean, as well as range, variance and standard deviation. That said, descriptive statistics are not
meant to draw conclusions.

2. Inferential statistics

Inferential statistics offer a way to take the data from a representative sample and use it to draw larger
truths. It allows organizations to extrapolate beyond the data set, going a step further than descriptive
statistics. Statistical inference relies heavily on finding as representative a sample as possible from which to
draw conclusions about a wider population. As there will always be uncertainty about extrapolating from a
limited set of data to a wider population, statistical inference relies upon estimating uncertainty in
predictions.

Key takeaway: Descriptive statistics are used to describe data, while inferential statistics are
used to infer conclusions and hypotheses about the same information.
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What are the benefits of statistical analysis?

1. Cut operating costs.

2. Perform market analysis.

3. Boost workplace efficiency.

4. Improve decision-making.
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What is statistical analysis software?

This software can deliver the specific analysis an organization needs to better
its business.

Such software can quickly and easily generate charts and graphs when
conducting descriptive statistics while at the same time running the more
sophisticated computations that are required when conducting inferential
statistics.

The more popular statistical analysis software services include IBM’s SPSS,
SAS, Revolution Analytics’ R, Minitab, Stata and Tableau, which is now part of
Salesforce.
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Software features
 Typical analytical functions include standard
modeling, confidence intervals and probability
calculations. They provide the core value of
statistical software and are the primary reason
to invest in such systems in the first place.
Despite that, analytical features should not be
your primary concern when shopping for
statistical analysis software.

 This is what populates charts and graphs. It

allows for real-time reporting and all of the
visual features that make the statistical results
accessible. Statistical presentation should
always be a major consideration when choosing
statistical analysis software.
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DATA MINING
Data mining is a process used by companies to turn raw data into
useful information. By using software to look for patterns in large
batches of data, businesses can learn more about their customers to
develop more effective marketing strategies, increase sales and
decrease costs. Data mining depends on effective data collection, 
warehousing, and computer processing.
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KEY TAKEAWAYS

 Data mining is the process of analyzing a large batch of information to discern trends
and patterns.

 Data mining can be used by corporations for everything from learning about what
customers are interested in or want to buy to fraud detection and spam filtering.

 Data mining programs break down patterns and connections in data based on what
information users request or provide.

 Social media companies use data mining techniques to commodify their users in order
to generate profit.

 This use of data mining has come under criticism lately as users are often unaware of
the data mining happening with their personal information, especially when it is used
to influence preferences.
 How
z Data Mining Works?

Data mining involves exploring and analyzing large blocks of information to glean
meaningful patterns and trends. It can be used in a variety of ways, such as database
marketing, credit risk management, fraud detection, spam Email filtering, or even to
discern the sentiment or opinion of users.

The data mining process breaks down into five steps.

First, organizations collect data and load it into their data warehouses. Next, they store and
manage the data, either on in-house servers or the cloud. Business analysts, management
teams, and information technology professionals access the data and determine how they
want to organize it. Then, application software sorts the data based on the user's results,
and finally, the end-user presents the data in an easy-to-share format, such as a graph or
table.
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Data Warehousing

Warehousing is an important aspect of data mining.

Warehousing is when companies centralize their data into one
database or program. With a data warehouse, an organization
may spin off segments of the data for specific users to
analyze and use. However, in other cases, analysts may start
with the data they want and create a data warehouse based
on those specs.
 z Data Mining Techniques

Data mining uses algorithms and various techniques to convert large collections of data into useful
output. The most popular types of data mining techniques include:

 Association rules, also referred to as market basket analysis, searches for relationships between
variables. This relationship creates additional value within the data set as it strives to link pieces of
data. For example, association rules would search a company’s sales history to see which products are
most purchased together; with this information, stores can plan, promote, and forecast accordingly.

 Classification uses predefined classes to assign to objects. These classes describe characteristics of

items or represent what the data points have in common with each. This data mining technique allows
the underlying data to be more neatly categorized and summarized across similar features or product
lines.

 Clustering is similar to classification. However, clustering identified similarities between objects, then
groups those items based on what makes them different from other items. While classification may
result in groups such as "shampoo", "conditioner", "soap", and "toothpaste", clustering may identify
groups such as "hair care" and "dental health".
 Data Mining Techniques
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 Decision trees are used to classify or predict an outcome based on a set list of criteria or decisions. A
decision tree is used to ask for input of a series of cascading questions that sort the dataset based on
responses given. Sometimes depicted as a tree-like visual, a decision tree allows for specific direction
and user input when drilling deeper into the data.

 K-Nearest Neighbor (KNN) is an algorithm that classifies data based on its proximity to other data.
The basis for KNN is rooted in the assumption that data points that are close to each are more similar
to each other than other bits of data. This non-parametric, supervised technique is used to predict
features of a group based on individual data points.

 Neural networks process data through the use of nodes. These nodes is comprised of inputs,
weights, and an output. Data is mapped through supervised learning (similar to how the human brain
is interconnected). This model can be fit to give threshold values to determine a model's accuracy.

 Predictive analysis strives to leverage historical information to build graphical or mathematical

models to forecast future outcomes. Overlapping with regression analysis, this data mining technique
aims at supporting an unknown figure in the future based on current data on hand.
 z The Data Mining Process
Step 1: Understand the Business

Before any data is touched, extracted, cleaned, or analyzed, it is important to understand the underlying entity and the
project at hand. What are the goals the company is trying to achieve by mining data? What is their current business
situation? What are the findings of a SWOT analysis? Before looking at any data, the mining process starts by
understanding what will define success at the end of the process.

Step 2: Understand the Data

Once the business problem has been clearly defined, it's time to start thinking about data. This includes what sources
are available, how it will be secured stored, how information will be gathered, and what the final outcome or analysis
may look like. This step also critically thinks about what limits there are to data, storage, security, and collection and
assesses how these constraints will impact the data mining process.

Step 3: Prepare the Data

It's now time to get our hands on information. Data is gathered, uploaded, extracted, or calculated. It is then cleaned,
standardized, scrubbed for outliers, assessed for mistakes, and checked for reasonableness. During this stage of data
mining, the data may also be checked for size as an overbearing collection of information may unnecessarily slow
computations and analysis.
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The Data Mining Process

Step 4: Build the Model

With our clean data set in hand, it's time to crunch the numbers. Data scientists use the types of data mining above to
search for relationships, trends, associations, or sequential patterns. The data may also be fed into  predictive models
 to assess how previous bits of information may translate into future outcomes.

Step 5: Evaluate the Results

The data-centered aspect of data mining concludes by assessing the findings of the data model(s). The outcomes from
the analysis may be aggregated, interpreted, and presented to decision-makers that have largely be excluded from the
data mining process to this point. In this step, organizations can choose to make decisions based on the findings.

Step 6: Implement Change and Monitor

The data mining process concludes with management taking steps in response to the findings of the analysis. The
company may decide the information was not strong enough or the findings were not relevant to change course.
Alternatively, the company may strategically pivot based on findings. In either case, management reviews the ultimate
impacts of the business and re-creates future data mining loops by identifying new business problems or
opportunities.
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Applications of Data Mining

 Sales

 Marketing

 Manufacturing

 Fraud Detection

 Human Resources

 Customer Service
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Benefits of Data Mining
Data mining ensures a company is collecting and analyzing reliable data. It is often a more rigid,
structured process that formally identifies a problem, gathers data related to the problem, and
strives to formulate a solution. Therefore, data mining helps a business become more profitable,
efficient, or operationally stronger.

Data mining can look very different across applications, but the overall process can be used with
almost any new or legacy application. Essentially any type of data can be gathered and analyzed, and
almost every business problem that relies on qualifiable evidence can be tackled using data mining.

The end goal of data mining is to take raw bits of information and determine if there is cohesion or
correlation among the data. This benefit of data mining allows a company to create value with the
information they have on hand that would otherwise not be overly apparent. Though data models
can be complex, they can also yield fascinating results, unearth hidden trends, and suggest unique
strategies.
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Limitations of Data Mining

1. Complexity - This complexity of data mining is one of the largest disadvantages to the
process. Data analytics often requires technical skillsets and certain software tools. Some
smaller companies may find this to be a barrier of entry too difficult to overcome.

2. Data mining doesn't always guarantee results. - A company may perform statistical analysis,
make conclusions based on strong data, implement changes, and not reap any benefits.
Through inaccurate findings, market changes, model errors, or inappropriate data populations
, data mining can only guide decisions and not ensure outcomes.

3. Cost - There is also a cost component to data mining. Data tools may require ongoing costly
subscriptions, and some bits of data may be expensive to obtain. Security and privacy
concerns can be pacified, though additional IT infrastructure may be costly as well. Data
mining may also be most effective when using huge data sets; however, these data sets must
be stored and require heavy computational power to analyze.
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DATA VISUALIZATION

Data visualization is part of many business-intelligence

tools and key to advanced analytics. It helps people
make sense of all the information, or data, generated
today. With data visualization, information is
represented in graphical form, as a pie chart, graph, or
another type of visual presentation.
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Why visual analytics are important

Good data visualization is essential for analyzing data and making decisions
based on that data. It allows people to quickly and easily see and
understand patterns and relationships and spot emerging trends that might
go unnoticed with just a table or spreadsheet of raw numbers. And in most
cases, no specialized training is required to interpret what’s presented in
the graphics, enabling universal understanding.

A well-designed graphic can not only provide information, but also heighten
the impact of that information with a strong presentation, attracting
attention and holding interest as no table or spreadsheet can.
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How data visualization works

Most data-visualization tools can connect with data sources

such as relational databases. This data, which may be stored on
premises or in the cloud, is retrieved for analysis. Users can
then select the best way to present the data from numerous
options. Some tools automatically provide display
recommendations based on the type of data presented.
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Choosing the perfect visualization tool

A graphic should always take into consideration the data type and
purpose. Some information is better suited to one type of graphic over
another: for example, a bar graph instead of a pie chart. But with most
tools, the user has a wide choice of visual analytics options, from
common charts such as line graphs and bar charts to timelines, maps,
plots, histograms, and custom designs.
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References

https://www.investopedia.com/terms/d/datamining.asp

https://www.businessnewsdaily.com/6000-statistical-analysis.html

https://www.oracle.com/ph/business-analytics/what-is-data-visualiz
ation/#:~:text=Data%20visualization%20is%20part%20of,another%
20type%20of%20visual
%20presentation