Let’s take a look at a hypothetical case: you are hired as an analyst at a company that is in the manufacturing sector. In this position, you will be asked to do financial analysis and evaluate the strategy of the company. Your job is quite critical, because your insights can affect the increase or decrease in profit, which in turn can affect the future of your employer.
Sounds stressful, right?
The stress is infinitely more on the shoulders of recruiters to make sure that the skills of candidates being hired can actually meet the demands of the task at hand.
Now, recruiters need a way to see whether their hire could make potentially good decisions. And they do this through looking for certain attributes that you need to have in order to make a major decision.
These attributes are what collectively make up the ability to analyze.
Looking at trends, most businesses in almost every single industry are moving towards being data driven. This rise is due to the unprecedented amount of information we’ve collected. They’re looking for people who have the capability to actually analyze the data and derive meaning out of it.
What does this mean? This means, if you want a job in the future, it would be a good idea to invest some time in honing your ability to analyze information and data.
“Analytical thinking has become a highly sought-after skill,” says Mike Dickson, Director NSW at Six Degrees Executive. “As every function seeks to operate more efficiently and to drive return on investment, the ability to analyse enables informed decision making.”
‘Ability to analyze’ is not subject to a certain profession or a domain. It can be just as simple as you trying to come up with a solution for a puzzle, and it can be as complex as coding and conducting software testers.
But how do you demonstrate ‘the ability to analyze’
Well, there are certain steps involved in everything you analyze. And even though the steps change with respect to the kind of problem you are trying to solve or type of data you are trying to analyze, there is an overall principle to the approach.
Step #1 - Understanding the Problem
Suppose you work for a medium sized firm which sells Electrical components to local manufacturers and store owners. Your sales have been plummeting for months in a row and your boss has tasked you with analyzing which factors contributed to the dip in sales.
The first step would be to understand the problem at hand. In this case, you will need to see what has been happening in your marketing strategy, how the price of components have been changing, whether there was a dip in production or business and so on. The first step is to get as much information as you can relating to the problem that’s been given and understand why it’s happened.
Step #2 - Analyzing Data and Information
This is where you take all the information you have gathered and make a comprehensive analysis of it, based on your understanding of the problem at hand. This will help you come up with possible explanations for this downturn in sales. The context that needs to be assessed here should be as comprehensive as possible, including factors like marketing strategy and pricing policies. There are various ways in which you can do this; for instance:
a) Detects Patterns in data.
One of the best ways to derive insights is to find patterns in the information that you have come across. At times, finding certain commonalities can be quite difficult; however, it is a great way to make a decision.
Look at the graph below and see whether there are suspicious patterns or trends:
You can clearly see that employee attrition is highest in the months between January and April, and the rate decreases as the year progresses.
b) Asking questions about the problem and its solution.
This can lead you to the root of the problem and help you answer many questions which might otherwise remain unanswered.
c) Creating observations based on historical trends and forecasting.
Now, this is how you can compile and analyze the data that you have gathered to make a decision, rather than just going by what you know.
Step #3 - Communicating the results and Taking Action
Now that you have understood the problem and have come up with a set of insights. If you can't verbalize these insights, then all this effort would be in vain. Making sure that your analysis also includes a set of actionable steps and strategies is imperative. For example, for people who do not understand the intricacies of industrial data, simple explanations behind some insights and how to act on them would be really helpful.
Remember, you would need to take feedback from your boss and other stakeholders that have been impacted by the downturn. You should also make sure that everyone who has an interest in the outcome of this analysis has access to it in order to support it.
How do the recruiters measure the ‘ability to analyze’
Recruiters don't have a magic eye to see through your resume and ascertain whether you are good at analysis or not. They need to measure the ‘ability to analyze’, just like they measure skills like programming or web design.
Here are some ways recruiters assess a candidate's ability to analyze:
They set up a situation in which they can observe how you tackle problems and how you go about analyzing them. This is usually done through interview questions such as the ones below:
They ask what is the biggest problem the candidate has faced till now, and how the candidate solved the question. Here, the interviewer is trying to assess what the candidate considers to be a big problem, how much is that candidate willing to share, and how honest they are, etc.
The Recruiter may need to see you in action, so they may ask you to set up a situation which comes along with some data and analyze it. Recruiters may ask you to look at random info/problems and derive solutions for/insights out of it. An example of this would be - Candidate A has good Excel skills, so he/she will be asked to use Microsoft Excel, then given random data and asked questions like "Explain this in layman's terms."
In most cases though, recruiters are more than happy if they could see how you gather info, address the problems, use critical thinking to assess data and make informed decisions.
What can I do to develop this skill?
'Don’t solve the puzzle, make one.' Now that seems counterintuitive. doesn't it.
To explain what I mean, think back to how we were told to solve puzzles as a kid. We were told to learn the basics about the puzzle first, to build it ourselves piece-by-piece and see what we can gather about solving the puzzle from that.
Don’t solve a puzzle, make one. As we were kids, we always solved sudoku or puzzles that we got in the newspapers/magazines. However, have you ever thought of making a puzzle on your own? Think about it, think about making a sudoku from ground zero. Once you follow this process of making a puzzle, you understand every single detail, rule, and foundations to build these puzzles. This makes your ability to analyze stronger and your ability to get into the details of a problem.
Wear your reasoning goggles, put on your thinking hats and start fiddling with your analyzing gloves by working on practical, real-world problems. The key here is putting yourself into the shoes of a business owner or manager who has been tasked with analyzing situations like these on a regular basis. Try to figure out what lies behind any trend - is it related to the economy, changing demographics, changing tastes and so on.