This blog is part 2 of a 5-part series providing insight into Edgeworth Analytics’ approach to data analytics for businesses. In our last post we discussed the “Importance of Understanding the Business.” Check back soon for “Data Analytics: Collecting and Preparing Data.”
When companies give consultants data, they have a specific business question in mind. Sometimes, however, insights gathered from the data lead to additional, detailed, and actionable questions.
Answering the Initial Fundamental Question
Let’s imagine a basic illustrative example. If consultants receive a set of sales data and are asked to examine the quarterly sales trends, that is a quick solution. After analyzing the data, it is determined that total revenues either increased or decreased over time, and the company’s profits increased or decreased. This is a straightforward answer to the original question. However, an initial review of the data paired with discussions with the client partners may lead to more actionable questions and insights.
Gleaning Insights by Asking More Questions
Once the initial question has been answered, additional important questions can arise. For example, are there specific types of products that are driving the increases or decreases in sales? Are there other products that are performing well, but are masked by the topline figures? What is the impact on margins? Oftentimes, asking the best business questions is akin to peeling an onion. You can start thinking about the trend in your sales over time, but then end up with a deeper dive into what products are driving sales, and which have the largest impact on the bottom line.
An Iterative Process
Consequently, there is not always a cookie cutter answer. As the business questions change, the way that you work with the data will also change. Determining the most meaningful and actionable business questions is an important part of the process. It will determine how you work with the data and what type of answer you give. We adapt to bring rigorous thinking to our clients’ questions and help them define questions that will lead to the most meaningful and actionable insights and outcomes.