📊 BBA 4th Semester - Business Analytics
UNIT – 2: Descriptive Analytics 📈
🎯 Learning Objectives
By the end of this unit, students will be able to:
Understand and calculate summary statistics
Create effective data visualizations
Design and interpret dashboards and reports
Utilize Excel and Tableau for data visualization
📋 Table of Contents
1. Summary Statistics
2. Data Visualization Techniques
3. Dashboards and Reports
4. Visualization Tools (Excel & Tableau)
📊 1. Summary Statistics
🔢 1.1 Measures of Central Tendency
Mean (Arithmetic Average) The mean represents the average value of a
dataset. It is calculated by summing all values and dividing by the number
of observations.
Formula: Mean = Σx / n Where:
Σx = Sum of all values
n = Number of observations
Characteristics:
Most commonly used measure of central tendency
Sensitive to extreme values (outliers)
Suitable for numerical data with normal distribution
Used in further statistical calculations
Median The median is the middle value when data is arranged in
ascending or descending order. For datasets with even number of
observations, it's the average of the two middle values.
Characteristics:
Not affected by extreme values
Better representation for skewed distributions
Divides the dataset into two equal halves
More robust than mean for non-normal distributions
Mode The mode is the value that appears most frequently in a dataset.
Characteristics:
Can be used for both numerical and categorical data
A dataset can have one mode (unimodal), two modes (bimodal), or
multiple modes
May not exist if no value repeats
Useful for identifying the most common occurrence
Measure Best Used When Advantages Disadvantages
Normal Affected by
Mean Uses all data points
distribution outliers
Skewed Doesn't use all
Median Robust to outliers
distribution data
Shows most common
Mode Categorical data May not be unique
value
📐 1.2 Measures of Variability
Variance Variance measures how spread out the data points are from the
mean. It represents the average of squared differences from the mean.
Formula for Population Variance: σ² = Σ(x - μ)² / N Formula for Sample
Variance: s² = Σ(x - x̄ )² / (n-1)
Characteristics:
Always positive value
Expressed in squared units of original data
Larger variance indicates greater spread
Foundation for calculating standard deviation
Standard Deviation Standard deviation is the square root of variance,
providing a measure of spread in the same units as the original data.
Formula: σ = √(σ²) or s = √(s²)
Characteristics:
Most widely used measure of variability
Same units as original data
Approximately 68% of data falls within one standard deviation of mean
(in normal distribution)
Approximately 95% of data falls within two standard deviations
Applications in Business:
Risk assessment in finance
Quality control in manufacturing
Performance evaluation
Market research analysis
📊 2. Data Visualization Techniques
📊 2.1 Bar Charts
Bar charts display categorical data using rectangular bars with heights or
lengths proportional to the values they represent.
Types:
Vertical Bar Chart: Categories on x-axis, values on y-axis
Horizontal Bar Chart: Categories on y-axis, values on x-axis
Grouped Bar Chart: Multiple categories grouped together
Stacked Bar Chart: Categories stacked on top of each other
When to Use:
Comparing different categories
Showing discrete data
Displaying survey results
Presenting sales data by region or product
Best Practices:
Start y-axis at zero to avoid misleading comparisons
Use consistent colors and spacing
Label axes clearly
Arrange categories in logical order
📊 2.2 Histograms
Histograms show the distribution of continuous numerical data by dividing
it into bins or intervals.
Key Features:
X-axis represents data ranges (bins)
Y-axis represents frequency or density
Bars touch each other (continuous data)
Shape reveals data distribution pattern
Distribution Patterns:
Normal Distribution: Bell-shaped curve
Skewed Right: Tail extends to the right
Skewed Left: Tail extends to the left
Uniform Distribution: Relatively flat across all bins
Applications:
Analyzing customer age distribution
Examining product quality measurements
Understanding income distribution
Studying exam score patterns
🥧 2.3 Pie Charts
Pie charts represent parts of a whole, showing proportions or percentages
of different categories.
Characteristics:
Circular chart divided into sectors
Each sector represents a category
Total always equals 100%
Effective for showing composition
When to Use:
Limited number of categories (ideally 5-7)
Showing market share
Displaying budget allocation
Representing demographic breakdowns
Limitations:
Difficult to compare similar-sized segments
Not suitable for many categories
Hard to read exact values
Cannot show changes over time
📈 2.4 Line Charts
Line charts display data points connected by lines, typically showing trends
over time.
Components:
X-axis: Usually represents time
Y-axis: Represents measured values
Lines: Connect data points to show trends
Multiple lines: Compare different series
Applications:
Stock price movements
Sales trends over months/years
Website traffic analysis
Economic indicators tracking
Advantages:
Clear trend visualization
Easy to compare multiple series
Effective for time-series data
Shows patterns and relationships
Chart Type Data Type Best For Limitations
Bar Chart Categorical Comparing categories Limited to discrete data
Histogram Continuous Showing distribution Requires binning decisions
Pie Chart Categorical Parts of whole Max 7 categories
Line Chart Time series Trends over time Requires sequential data
📊 3. Dashboards and Reports
📈 3.1 Dashboards
A dashboard is a visual display of key performance indicators (KPIs) and
metrics relevant to a specific objective or business process.
Key Components:
KPI Indicators: Key metrics displayed prominently
Charts and Graphs: Visual representations of data
Filters and Controls: Interactive elements for data exploration
Real-time Updates: Current data reflection
Types of Dashboards:
Strategic Dashboards: High-level KPIs for executives
Operational Dashboards: Real-time monitoring of processes
Analytical Dashboards: Detailed analysis for decision-making
Tactical Dashboards: Department-specific metrics
Design Principles:
Clarity: Easy to understand at a glance
Relevance: Shows only necessary information
Consistency: Uniform design and layout
Interactivity: Allows user exploration
Responsiveness: Adapts to different screen sizes
📄 3.2 Reports
Reports are structured documents that present data analysis findings in a
comprehensive format.
Types of Reports:
Summary Reports: High-level overview of key findings
Detailed Reports: Comprehensive analysis with supporting data
Exception Reports: Highlight anomalies or issues
Trend Reports: Show patterns over time
Comparative Reports: Compare different periods or segments
Report Structure:
1. Executive Summary: Key findings and recommendations
2. Introduction: Purpose and scope
3. Methodology: Data sources and analysis methods
4. Findings: Detailed results with visualizations
5. Conclusions: Interpretations and insights
6. Recommendations: Actionable suggestions
7. Appendices: Supporting data and technical details
Best Practices:
Use clear, concise language
Include relevant visualizations
Provide context for data
Focus on actionable insights
Maintain consistent formatting
🛠️ 4. Visualization Tools
📊 4.1 Microsoft Excel
Excel is a widely-used spreadsheet application with robust data
visualization capabilities.
Key Features:
Chart Types: Bar, line, pie, scatter, histogram, and more
PivotTables: Interactive data summarization
PivotCharts: Dynamic visualizations from PivotTables
Conditional Formatting: Visual highlighting of data patterns
Data Analysis ToolPak: Advanced statistical functions
Advantages:
Familiar interface for most users
Integration with other Microsoft Office applications
Strong data manipulation capabilities
Cost-effective for small to medium datasets
Extensive formula and function library
Limitations:
Limited with very large datasets
Basic dashboard capabilities
Limited real-time data connectivity
Fewer advanced visualization options
Common Excel Visualizations:
Column and bar charts for categorical comparisons
Line charts for trend analysis
Scatter plots for correlation analysis
Histograms for distribution analysis
Pie charts for composition analysis
📊 4.2 Tableau
Tableau is a powerful data visualization and business intelligence platform.
Key Features:
Drag-and-Drop Interface: Intuitive chart creation
Data Connectivity: Connect to various data sources
Interactive Dashboards: Rich user interaction capabilities
Real-time Analysis: Live data connections
Advanced Analytics: Statistical functions and calculations
Advantages:
Handles large datasets efficiently
Professional-quality visualizations
Strong dashboard and storytelling capabilities
Extensive data source connectivity
Active community and learning resources
Tableau Products:
Tableau Desktop: Full-featured desktop application
Tableau Server: Enterprise deployment and sharing
Tableau Online: Cloud-based platform
Tableau Public: Free version for public data
Tableau Mobile: Mobile access to dashboards
Tableau Workflow:
1. Connect: Link to data sources
2. Prepare: Clean and structure data
3. Analyze: Create visualizations and explore data
4. Share: Publish dashboards and reports
🎯 Summary
Descriptive Analytics forms the foundation of data analysis by helping
organizations understand their current state through:
Summary Statistics: Providing mathematical measures to describe
data characteristics
Data Visualization: Creating visual representations to reveal patterns
and insights
Dashboards: Offering real-time monitoring and KPI tracking
Reports: Delivering comprehensive analysis documentation
Tools: Enabling efficient data analysis and visualization
The effective use of descriptive analytics enables businesses to make
informed decisions, identify trends, monitor performance, and
communicate insights clearly to stakeholders.
📚 Key Takeaways
1. Choose appropriate measures of central tendency based on data
distribution
2. Use variability measures to understand data spread and reliability
3. Select visualization types based on data type and communication
goals
4. Design dashboards with user needs and objectives in mind
5. Structure reports to tell a clear, actionable story
6. Leverage appropriate tools based on data size, complexity, and
requirements
End of Unit 2: Descriptive Analytics
