The term “big data” refers to data that is so large, fast or complex that it’s difficult or impossible to process using traditional methods. The act of accessing and storing large amounts of information for analytics has been around a long time. But the concept of big data gained momentum in the early 2000s when industry analyst Doug Laney articulated the now-mainstream definition of big data as the three V’s:
Volume: Organizations collect data from a variety of sources, including business transactions, smart (IoT) devices, industrial equipment, videos, social media and more. In the past, storing it would have been a problem – but cheaper storage on platforms like data lakes and Hadoop have eased the burden.
Velocity: With the growth in the Internet of Things, data streams in to businesses at an unprecedented speed and must be handled in a timely manner. RFID tags, sensors and smart meters are driving the need to deal with these torrents of data in near-real time.
Variety: Data comes in all types of formats – from structured, numeric data in traditional databases to unstructured text documents, emails, videos, audios, stock ticker data and financial transactions. – SAS
Types of Data Analysis: Techniques and Methods
There are several types of data analysis techniques that exist based on business and technology. The major types of data analysis are:
– Text Analysis
– Statistical Analysis
– Diagnostic Analysis
– Predictive Analysis
– Prescriptive Analysis
Text Analysis is also referred to as Data Mining. It is a method to discover a pattern in large data sets using databases or data mining tools. It used to transform raw data into business information. Business Intelligence tools are present in the market which is used to take strategic business decisions. Overall it offers a way to extract and examine data and deriving patterns and finally interpretation of the data.
Statistical Analysis shows “What happen?” by using past data in the form of dashboards. Statistical Analysis includes collection, Analysis, interpretation, presentation, and modeling of data. It analyses a set of data or a sample of data. There are two categories of this type of Analysis – Descriptive Analysis and Inferential Analysis.
Diagnostic Analysis shows “Why did it happen?” by finding the cause from the insight found in Statistical Analysis. This Analysis is useful to identify behavior patterns of data. If a new problem arrives in your business process, then you can look into this Analysis to find similar patterns of that problem. And it may have chances to use similar prescriptions for the new problems.
Predictive Analysis shows “what is likely to happen” by using previous data. The simplest example is like if last year I bought two dresses based on my savings and if this year my salary is increasing double then I can buy four dresses. But of course it’s not easy like this because you have to think about other circumstances like chances of prices of clothes is increased this year or maybe instead of dresses you want to buy a new bike, or you need to buy a house!
So here, this Analysis makes predictions about future outcomes based on current or past data. Forecasting is just an estimate. Its accuracy is based on how much detailed information you have and how much you dig in it.
Prescriptive Analysis combines the insight from all previous Analysis to determine which action to take in a current problem or decision. Most data-driven companies are utilizing Prescriptive Analysis because predictive and descriptive Analysis are not enough to improve data performance. Based on current situations and problems, they analyze the data and make decisions.