Data Analysis - Wikipedia
Data Analysis - Wikipedia
Data analysis is the process of inspecting, cleansing, transforming, and modeling data with the goal
of discovering useful information, informing conclusions, and supporting decision-making.[1] Data
analysis has multiple facets and approaches, encompassing diverse techniques under a variety of
names, and is used in different business, science, and social science domains.[2] In today's business
world, data analysis plays an important role in making decisions more scientific and helping
businesses operate more effectively.[3]
Data mining is a particular data analysis technique that focuses on statistical modeling and knowledge
discovery for predictive rather than purely descriptive purposes, while business intelligence covers
data analysis that relies heavily on aggregation, focusing mainly on business information. In statistical
applications, data analysis can be divided into descriptive statistics, exploratory data analysis (EDA),
and confirmatory data analysis (CDA).[4] EDA focuses on discovering new features in the data, while
CDA focuses on confirming or falsifying existing hypotheses.[5] Predictive analytics focuses on the
application of statistical models for predictive forecasting or classification, while text analytics applies
statistical, linguistic, and structural techniques to extract and classify information from textual
sources, a variety of unstructured data. All of the above are varieties of data analysis.[6]
There are several phases, and they are iterative, in that feedback from later phases may result in
additional work in earlier phases.[8]
Data requirements
The data is necessary as inputs to the analysis, which is specified based upon the requirements of
those directing the analytics (or customers, who will use the finished product of the analysis).[9] The
general type of entity upon which the data will be collected is referred to as an experimental unit (e.g.,
a person or population of people). Specific variables regarding a population (e.g., age and income)
may be specified and obtained. Data may be numerical or categorical (i.e., a text label for numbers).[8]
Data collection
Data may be collected from a variety of sources.[10] A list of data sources are available for study &
research. The requirements may be communicated by analysts to custodians of the data; such as,
Information Technology personnel within an organization.[11] Data collection or data gathering is
the process of gathering and measuring information on targeted variables in an established system,
which then enables one to answer relevant questions and evaluate outcomes. The data may also be
collected from sensors in the environment, including traffic cameras, satellites, recording devices, etc.
It may also be obtained through interviews, downloads from online sources, or reading
documentation.[8]
Data processing
Data integration is a precursor to data analysis:
Data, when initially obtained, must be
processed or organized for analysis. For
instance, this may involve placing data into
rows and columns in a table format (known as
structured data) for further analysis, often
through the use of spreadsheet(excel) or
statistical software.[8]
Data cleaning
Once processed and organized, the data may be
incomplete, contain duplicates, or contain
errors.[12] The need for data cleaning will arise The phases of the intelligence cycle used to convert raw
information into actionable intelligence or knowledge are
from problems in the way that the data is
conceptually similar to the phases in data analysis.
entered and stored.[12][13] Data cleaning is the
process of preventing and correcting these
errors. Common tasks include record matching, identifying inaccuracy of data, overall quality of
existing data, deduplication, and column segmentation.[14][15]
Such data problems can also be identified through a variety of analytical techniques. For example;
with financial information, the totals for particular variables may be compared against separately
published numbers that are believed to be reliable.[16] Unusual amounts, above or below
predetermined thresholds, may also be reviewed. There are several types of data cleaning that are
dependent upon the type of data in the set; this could be phone numbers, email addresses, employers,
or other values.[17] Quantitative data methods for outlier detection can be used to get rid of data that
appears to have a higher likelihood of being input incorrectly. Text data spell checkers can be used to
lessen the amount of mistyped words. However, it is harder to tell if the words are contextually (i.e.,
semantically and idiomatically) correct.
Inferential statistics utilizes techniques that measure the relationships between particular
variables.[22] For example, regression analysis may be used to model whether a change in advertising
(independent variable X), provides an explanation for the variation in sales (dependent variable Y),
i.e. is Y a function of X? This can be described as (Y = aX + b + error), where the model is designed
such that (a) and (b) minimize the error when the model predicts Y for a given range of values of
X.[23]
Data product
A data product is a computer application that takes data inputs and generates outputs, feeding
them back into the environment.[24] It may be based on a model or algorithm. For instance, an
application that analyzes data about customer purchase history, and uses the results to recommend
other purchases the customer might enjoy.[25][8]
Communication
Once data is analyzed, it may be reported in many formats to the users of the analysis to support their
requirements.[27] The users may have feedback, which results in additional analysis.
When determining how to communicate the results, the analyst may consider implementing a variety
of data visualization techniques to help communicate the message more clearly and efficiently to the
audience. Data visualization uses information displays (graphics such as, tables and charts) to help
communicate key messages contained in the data. Tables are a
valuable tool by enabling the ability of a user to query and
focus on specific numbers; while charts (e.g., bar charts or line
charts), may help explain the quantitative messages contained
in the data.[28]
Quantitative messages
Stephen Few described eight types of quantitative messages Data visualization is used to help
that users may attempt to communicate from a set of data, understand the results after data is
including the associated graphs.[29][30] analyzed.[26]
Regression analysis may be used when the analyst is trying to determine the extent to which
independent variable X affects dependent variable Y (e.g., "To what extent do changes in the
unemployment rate (X) affect the inflation rate (Y)?").[41]
Necessary condition analysis (NCA) may be used when the analyst is trying to determine the extent to
which independent variable X allows variable Y (e.g., "To what extent is a certain unemployment rate
(X) necessary for a certain inflation rate (Y)?").[41] Whereas (multiple) regression analysis uses
additive logic where each X-variable can produce the outcome and the X's can compensate for each
other (they are sufficient but not necessary),[42] necessary condition analysis (NCA) uses necessity
logic, where one or more X-variables allow the outcome to exist, but may not produce it (they are
necessary but not sufficient). Each single necessary condition must be present and compensation is
not possible.[43]
Given a set of
What is the sorted
data cases, - Order the cars by weight.
order of a set S of data
rank them
5 Sort cases according to - Rank the cereals by calories.
according to
their value of attribute
some ordinal
A?
metric.
7 Characterize Distribution Given a set of What is the distribution - What is the distribution of
data cases of values of attribute A carbohydrates in cereals?
and a in a set S of data
quantitative cases? - What is the age distribution of
attribute of shoppers?
interest,
characterize
the
distribution of
that attribute's
values over
the set.
Identify any
anomalies
within a given - Are there exceptions to the
set of data Which data cases in a relationship between horsepower and
cases with set S of data cases acceleration?
8 Find Anomalies respect to a have
given unexpected/exceptional
- Are there any outliers in
relationship or values? protein?
expectation,
e.g. statistical
outliers.
Given a set of
data cases,
Which data cases in a
find - Are there groups of restaurants that
set S of data cases are
11 Contextualization contextual have foods based on my current caloric
relevant to the current
relevancy of intake?
users' context?
the data to the
users.
Cognitive biases
There are a variety of cognitive biases that can adversely affect analysis. For example, confirmation
bias is the tendency to search for or interpret information in a way that confirms one's
preconceptions.[50] In addition, individuals may discredit information that does not support their
views.[51]
Analysts may be trained specifically to be aware of these biases and how to overcome them.[52] In his
book Psychology of Intelligence Analysis, retired CIA analyst Richards Heuer wrote that analysts
should clearly delineate their assumptions and chains of inference and specify the degree and source
of the uncertainty involved in the conclusions.[53] He emphasized procedures to help surface and
debate alternative points of view.[54]
Innumeracy
Effective analysts are generally adept with a variety of numerical techniques. However, audiences may
not have such literacy with numbers or numeracy; they are said to be innumerate.[55] Persons
communicating the data may also be attempting to mislead or misinform, deliberately using bad
numerical techniques.[56]
For example, whether a number is rising or falling may not be the key factor. More important may be
the number relative to another number, such as the size of government revenue or spending relative
to the size of the economy (GDP) or the amount of cost relative to revenue in corporate financial
statements.[57] This numerical technique is referred to as normalization[16] or common-sizing. There
are many such techniques employed by analysts, whether adjusting for inflation (i.e., comparing real
vs. nominal data) or considering population increases, demographics, etc.[58]
Analysts may also analyze data under different assumptions or scenarios. For example, when analysts
perform financial statement analysis, they will often recast the financial statements under different
assumptions to help arrive at an estimate of future cash flow, which they then discount to present
value based on some interest rate, to determine the valuation of the company or its stock.[59]
Similarly, the CBO analyzes the effects of various policy options on the government's revenue, outlays
and deficits, creating alternative future scenarios for key measures.[60]
Other applications
Education
In education, most educators have access to a data system for the purpose of analyzing student
data.[62] These data systems present data to educators in an over-the-counter data format (embedding
labels, supplemental documentation, and a help system and making key package/display and content
decisions) to improve the accuracy of educators' data analyses.[63]
Practitioner notes
This section contains rather technical explanations that may assist practitioners but are beyond the
typical scope of a Wikipedia article.[64]
Quality of data
The quality of the data should be checked as early as possible. Data quality can be assessed in several
ways, using different types of analysis: frequency counts, descriptive statistics (mean, standard
deviation, median), normality (skewness, kurtosis, frequency histograms), normal imputation is
needed.[66]
Analysis of extreme observations: outlying observations in the data are analyzed to see if they
seem to disturb the distribution.[67]
Comparison and correction of differences in coding schemes: variables are compared with coding
schemes of variables external to the data set, and possibly corrected if coding schemes are not
comparable.[68]
Test for common-method variance. The choice of analyses to assess the data quality during the
initial data analysis phase depends on the analyses that will be conducted in the main analysis
phase.[69]
Quality of measurements
The quality of the measurement instruments should only be checked during the initial data analysis
phase when this is not the focus or research question of the study.[70] One should check whether
structure of measurement instruments corresponds to structure reported in the literature.
Initial transformations
After assessing the quality of the data and of the measurements, one might decide to impute missing
data, or to perform initial transformations of one or more variables, although this can also be done
during the main analysis phase.[73]
Possible transformations of variables are:[74]
Square root transformation (if the distribution differs moderately from normal)
Log-transformation (if the distribution differs substantially from normal)
Inverse transformation (if the distribution differs severely from normal)
Make categorical (ordinal / dichotomous) (if the distribution differs severely from normal, and no
transformations help)
Did the implementation of the study fulfill the intentions of the research design?
One should check the success of the randomization procedure, for instance by checking whether
background and substantive variables are equally distributed within and across groups. If the study
did not need or use a randomization procedure, one should check the success of the non-random
sampling, for instance by checking whether all subgroups of the population of interest are represented
in the sample.[75]
Other possible data distortions that should be checked are:
dropout (this should be identified during the initial data analysis phase)
Item non-response (whether this is random or not should be assessed during the initial data
analysis phase)
Treatment quality (using manipulation checks).[76]
In the case of non-normals: should one transform variables; make variables categorical
(ordinal/dichotomous); adapt the analysis method?
In the case of missing data: should one neglect or impute the missing data; which imputation
technique should be used?
In the case of outliers: should one use robust analysis techniques?
In case items do not fit the scale: should one adapt the measurement instrument by omitting
items, or rather ensure comparability with other (uses of the) measurement instrument(s)?
In the case of (too) small subgroups: should one drop the hypothesis about inter-group
differences, or use small sample techniques, like exact tests or bootstrapping?
In case the randomization procedure seems to be defective: can and should one calculate
propensity scores and include them as covariates in the main analyses?[79]
Analysis
Several analyses can be used during the initial data analysis phase:[80]
Nonlinear analysis
Nonlinear analysis is often necessary when the data is recorded from a nonlinear system. Nonlinear
systems can exhibit complex dynamic effects including bifurcations, chaos, harmonics and
subharmonics that cannot be analyzed using simple linear methods. Nonlinear data analysis is closely
related to nonlinear system identification.[82]
Exploratory data analysis should be interpreted carefully. When testing multiple models at once there
is a high chance on finding at least one of them to be significant, but this can be due to a type 1 error.
It is important to always adjust the significance level when testing multiple models with, for example,
a Bonferroni correction.[87] Also, one should not follow up an exploratory analysis with a
confirmatory analysis in the same dataset.[88] An exploratory analysis is used to find ideas for a
theory, but not to test that theory as well.[88] When a model is found exploratory in a dataset, then
following up that analysis with a confirmatory analysis in the same dataset could simply mean that the
results of the confirmatory analysis are due to the same type 1 error that resulted in the exploratory
model in the first place.[88] The confirmatory analysis therefore will not be more informative than the
original exploratory analysis.[89]
Stability of results
It is important to obtain some indication about how generalizable the results are.[90] While this is
often difficult to check, one can look at the stability of the results. Are the results reliable and
reproducible? There are two main ways of doing that.
Cross-validation. By splitting the data into multiple parts, we can check if an analysis (like a fitted
model) based on one part of the data generalizes to another part of the data as well.[91] Cross-
validation is generally inappropriate, though, if there are correlations within the data, e.g. with
panel data.[92] Hence other methods of validation sometimes need to be used. For more on this
topic, see statistical model validation.[93]
Sensitivity analysis. A procedure to study the behavior of a system or model when global
parameters are (systematically) varied. One way to do that is via bootstrapping.[94]
Free software for data analysis
Free software for data analysis include:
DevInfo – A database system endorsed by the United Nations Development Group for monitoring
and analyzing human development.[95]
ELKI – Data mining framework in Java with data mining oriented visualization functions.
KNIME – The Konstanz Information Miner, a user friendly and comprehensive data analytics
framework.
Orange – A visual programming tool featuring interactive data visualization and methods for
statistical data analysis, data mining, and machine learning.
Pandas – Python library for data analysis.
PAW – FORTRAN/C data analysis framework developed at CERN.
R – A programming language and software environment for statistical computing and graphics.[96]
ROOT – C++ data analysis framework developed at CERN.
SciPy – Python library for scientific computing.
Julia – A programming language well-suited for numerical analysis and computational science.
Reproducible analysis
The typical data analysis workflow involves collecting data, running analyses, creating visualizations,
and writing reports. However, this workflow presents challenges, including a separation between
analysis scripts and data, as well as a gap between analysis and documentation. Often, the correct
order of running scripts is only described informally or resides in the data scientist's memory. The
potential for losing this information creates issues for reproducibility.
To address these challenges, it is essential to document analysis script content and workflow.
Additionally, overall documentation is crucial, as well as providing reports that are understandable by
both machines and humans, and ensuring accurate representation of the analysis workflow even as
scripts evolve.[97]
See also
Actuarial science Analytics
Augmented Analytics Machine learning
Business intelligence Multiway data analysis
Data presentation architecture Qualitative research
Exploratory data analysis Structured data analysis (statistics)
List of datasets for machine-learning research Text mining
List of data science software Unstructured data
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Further reading
Adèr, H.J. & Mellenbergh, G.J. (with contributions by D.J. Hand) (2008). Advising on Research
Methods: A Consultant's Companion. Huizen, the Netherlands: Johannes van Kessel Publishing.
ISBN 978-90-79418-01-5
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Education, Inc. / Allyn and Bacon, ISBN 978-0-205-45938-4