ACCA Strategic Professional · Advanced Performance Management · Data science and analytics

Marlow Logistics finds that delivery costs per parcel rose 9% last quarter. Analysts drill down by route, driver and vehicle type and discover the increase is almost entirely due to older vehicles on rural routes needing frequent repairs. Which type of analytics is being applied?

This is diagnostic analytics. The analysts drill down by route, driver and vehicle type to establish why delivery costs per parcel rose, finding older rural vehicles responsible. Descriptive analytics would only report the rise, while predictive and prescriptive analytics look forward and recommend actions.

ADescriptive analytics, because it uses historical cost data
BPredictive analytics, because it uses statistical models
CDiagnostic analytics, because it investigates why the cost increase occurredCorrect
DPrescriptive analytics, because it leads to a management decision

Explanation

The analysts are drilling into data to find the cause of a past variance, which is diagnostic analytics. Option A is wrong because merely reporting the 9% rise would be descriptive. No model is forecasting future values, and no recommended action is generated by the analysis itself.

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