Defining the different levels of analytics
Analytics usefulness lies in the ability to increase your level of competitiveness.
Level 1: Standard Reports
The most basic of all analytics is the report on what just happened. On its own it has limited usefulness. Standard reports answer the questions on ‘what just happened’ and ‘when did it happen’.
Level 2: Custom Reports
Reports that drill down into specific data. These reports still only answer ‘what just happened’ and ‘when did it happen’ except they contain more focused details.
Level 3: Query Drill down
These reports deal with a bit more detail and allows for a little bit more detail. They explore the questions ‘where is the problem’
Level 4: Alerts
This allows specific situations, data, or events to be flagged and brought to your attention in order to notify you of future similar situations. It is about ‘when should I react and what should I do?’
Level 5: Statistical Analysis
This level looks at what is happening, why is it happening and what opportunities are being missed. It is looking at data collected and asking questions base on this data.
Level 6: Forecasting
This is one of the hottest topics at the moment, and is about determining how much inventory is required so that you don’t run out of stock. It is looking at trends and deciding if those trends will continue or not.
Level 7: Predictive Modeling
Predicting the possible outcome based on specific data. Ie running a marketing campaign – who will respond, how many will respond, who will leave or stay or buy or engage. What will customers be more interested in?
Level 8: Optimization
This takes your resources, needs, data and technology into consideration and works to help you discover the best possible path to accomplishing your goals.