Unit 1: Basics of Data Analytics
• Meaning and concept of Data Analytics
• Data Analytics Life Cycle
• Importance of Data Analytics in Modern Business
• Essential Skills for Managers in Data Analytics.
• Tools of Data Analytics.
Meaning and Concept of Data Analytics
Data Analytics refers to the process of examining datasets to draw conclusions about the
information they contain. It uses statistical, mathematical, and computational tools to
identify patterns, trends, and insights in data.
Data Analytics is the process of collecting, organizing and studying data to find useful
information understand what’s happening and make better decisions. In simple words it
helps people and businesses learn from data like what worked in the past, what is happening
now and what might happen in the future.
Concept-
• Raw Data → Information → Insights
• It involves collecting, cleaning, processing, and analyzing data.
• Helps in decision-making, forecasting, and problem-solving.
• Used in almost every industry like finance, marketing, healthcare, retail, etc
Data Analytics Life Cycle
Phase 1: Discovery
• The data science team learns and investigates the problem.
• Develop context and understanding.
• Come to know about data sources needed and available for the project.
• The team formulates the initial hypothesis that can be later tested with data.
Example
A company wants to know why its sales dropped last month.
Phase 2: Data Preparation -
• Steps to explore, preprocess, and condition data before modeling and analysis.
• It requires the presence of an analytic sandbox, the team executes, loads, and
transforms, to get data into the sandbox.
• Data preparation tasks are likely to be performed multiple times and not in
predefined order.
• Several tools commonly used for this phase are - Hadoop, Alpine Miner, Open Refine,
etc.
Example
You collect sales data from Excel, customer data from the website, and remove records with
missing product names.
Phase 3: Model Planning
• The team explores data to learn about relationships between variables and
subsequently, selects key variables and the most suitable models.
• In this phase, the data science team develops data sets for training, testing, and
production purposes.
• Team builds and executes models based on the work done in the model planning
phase.
Example
• You choose to analyze monthly trends and compare them with customer visits using
bar graphs and correlation.
Phase 4: Model Building
• Team develops datasets for testing, training, and production purposes.
• Team also considers whether its existing tools will suffice for running the models or if
they need more robust environment for executing models.
Example
• You create a model that shows how customer footfall and discounts affect sales.
Phase 5: Communication Results
• After executing model team need to compare outcomes of modeling to criteria
established for success and failure.
• Team considers how best to articulate findings and outcomes to various team
members and stakeholders, taking into account warning, assumptions.
• Team should identify key findings, quantify business value, and develop narrative to
summarize and convey findings to stakeholders.
Example
Sales dropped in June due to low online ads and fewer discount offers. We suggest
increasing digital marketing."
Phase 6: Operationalize
• The team communicates benefits of project more broadly and sets up pilot project to
deploy work in controlled way before broadening the work to full enterprise of users.
• This approach enables team to learn about performance and related constraints of
the model in production environment on small scale which make adjustments before
full deployment.
• The team delivers final reports, briefings, codes.
Example
• You create a dashboard in Power BI or Excel that shows monthly sales performance
with reasons.
Phase Purpose
1. Discovery Understand the business question
2. Data Preparation Collect and clean the data
3. Model Planning Choose the method of analysis
4. Model Building Perform the analysis
5. Communicate Present results and take decisions
6. Operationalize Create dashboards or reports
Importance of Data Analytics in Modern Business
Improved decision-making: Data analytics provides you with valuable insights that can help
make better decisions. By analyzing data, you can identify trends, patterns and relationships.
Competitive advantage: You can use data to streamline operations, optimize marketing and
create products that meet customer demands. In turn, this helps you to gain a competitive
advantage.
Cost savings: By using data analytics to optimize operations, you can identify futility and cost
savings areas. This can lead to reduced costs and increased profitability.
Improved customer experiences: Data analytics can help you gain insights into customer
behavior, preferences and needs. By understanding your customers better, you can
personalize their offerings, improve customer satisfaction and build customer loyalty.
Innovation: Data analytics can help you identify new opportunities and areas for growth. By
analyzing data, you can identify emerging trends, market gaps and unmet customer needs.
This can lead to the development of new products and services that better meet customer
needs.
Benefit Explanation
Better Decisions Based on real data, not guesses
Customer Insights Know what customers want
Improved Efficiency Optimize time, cost, and resources
Forecasting Predict future outcomes
Risk Detection Identify fraud and errors early
Personalized Marketing Deliver what customers want
Competitive Edge Stay ahead of the competition
Data Analytics it’s a powerful tool that helps modern businesses grow smarter, act faster,
and stay ahead in today’s digital world.
Essential Skills for Managers in Data Analytics
In today’s data-driven world, managers don’t need to be expert programmers or data
scientists but they must understand data and how to use it to make smart business
decisions.
1. Data Literacy
• The ability to read, understand, and interpret data.
• Managers should know what data means, how it is collected, and how to use it.
Example
A marketing manager reads a customer report and understands which ad campaigns worked
best.
2. Analytical Thinking
• Ability to break down complex problems and analyze situations logically.
• Helps in identifying patterns, trends, and root causes in data.
Example
A sales manager analyzes declining sales and identifies which product is underperforming.
3. Business Acumen
• Understanding how the business works — revenue, cost, profit, customers, market,
etc.
• Connects data analysis with real business goals.
Example
A retail manager uses sales data to decide where to open a new store
4. Decision-Making Skills
• Managers should be able to use data to make quick and correct decisions.
• Good decision-making depends on interpreting results and acting fast.
Example
After analyzing inventory data, a manager decides to reorder fast-moving products early.
5. Communication Skills
• Managers must explain data findings clearly to team members, top management, or
clients.
• Use simple language, graphs, and visual reports to share insights.
Example
A manager presents a chart showing how online sales have increased 30% in the last month.
Tools of Data Analytics
1. Microsoft Excel
• Most basic and widely used tool for data handling.
• Used for data entry, sorting, filtering, calculations, pivot tables, charts, and basic
analysis.
2. R Programming
• A statistical programming language.
• Highly used for statistical analysis, charts, and graphs.
Popular Libraries: ggplot2, dplyr, tidyr
3. Python
• A programming language widely used in data science and analytics.
• Supports data analysis, visualization, and machine learning through libraries like:
o Pandas (data manipulation)
o Matplotlib/Seaborn (visualization)
o Scikit-learn (machine learning)
