What business analytics is, and who it serves

Analytics is a process that ends in a decision

Business analytics is the process of turning data into a summary that informs a decision. Each word in that sentence is load-bearing. Data is the raw record — twelve rows of orders. A summary is a number or picture computed from it — average order amount by province. It becomes information only when someone can act on it, and it serves a decision-maker, who is usually not the analyst. In this course the analyst is you; the decision-maker is a manager, a CFO, a client.

This is why the course is not the statistics course (that is AFM 113). Here the statistics are a by-product. What is examined is the process — knowing which question you are answering, which tool answers it, and what phase you are in.

Worked example — one decision, four questions

Maple & Birch Office Supply Ltd. of Waterloo sells online and in-store across Ontario, Quebec, British Columbia and Alberta. The owner asks: should we open a second Alberta store? That is a decision, not a question data can answer directly. Four analytic questions feed it, and each is a different type:

• Descriptive — what happened? What were Alberta's sales in Q1 2025? (From the orders sheet: two orders totalling $2,300.)
• Diagnostic — why did it happen? Why is Alberta's average order so high — a few large business customers, or many small ones?
• Predictive — what will happen? What will Alberta's sales be next quarter if the trend holds?
• Prescriptive — what should we do? Given the forecast and the cost of a lease, should we open the store?

The types are ordered by how much they lean on the previous one. You cannot diagnose a rise you have not described; you cannot predict from a pattern you have not diagnosed; and a prescription is a prediction plus a cost. In AFM 112 almost everything you build is descriptive or diagnostic, with one predictive model (a fitted line) in Module 13. Prescriptive analysis belongs to later courses — but the paper still asks you to classify a question, and the classification is the point.

Data, information, decision

A pivot table of 48 numbers that nobody in the room can act on is data, not information — however neatly it is formatted. A single line, "Alberta's average order is $1,150 on two orders, so the number cannot yet support a lease", is information: it points at the decision. The course's last module, the dashboard, is about making that step deliberately.

Classify four more

Try these before reading on. (1) Which channel, online or store, had the higher average order in Q1? — descriptive. (2) If we cut Quebec shipping fees, how many more orders would we expect? — predictive. (3) Why did store orders in BC fall in March? — diagnostic. (4) Which three products should we discount to clear stock by June? — prescriptive. The decision-maker for each is a different person: the sales manager for (1), the pricing lead for (2), the BC store manager for (3), and the owner for (4). Naming that person is not a formality; it decides what counts as a useful answer.