ACCA Strategic Professional · Strategic Business Leader · Big data and data analytics
Kestrel Retail, a national grocery chain, has produced a dashboard showing that sales of barbecue products fell 18% in the last quarter compared with the same quarter last year. The board now asks the analytics team to find out why the fall happened, by comparing weather, pricing and competitor promotions across stores. Which type of analytics is the board now requesting?
The board is asking for diagnostic analytics. Descriptive analytics only reports what happened, such as the 18% sales fall. Diagnostic analytics investigates why it happened by comparing factors like weather, pricing and competitor promotions, whereas predictive and prescriptive analytics look forward to forecasts and recommended actions.
- ADescriptive analytics
- BDiagnostic analyticsCorrect
- CPredictive analytics
- DPrescriptive analytics
Explanation
The dashboard of past sales is descriptive (what happened). The new request is to explain why it happened by examining causes across stores, which is diagnostic analytics. Predictive would forecast future sales, and prescriptive would recommend actions.
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