Grouping Data

Not all data are created equal. Some data carry rich details that allow for deeper or more insightful analysis. Other data offer scant details that provide rudimentary analysis. We can organize data around four characteristics, including:

  1. Description – At its most basic level, all data must describe the observation. Data must correspond to a specific or particular element. Without description, then we cannot call it data.
  2. Order – The order of the observations or elements matters. If we change the order of observations or elements, then we change the interpretation of the observations or elements.
  3. Distance – The interval or space between observations or elements matters. That distance must be equal between all observations or elements.
  4. Zero – This number is real and it is spectacular.

With these characteristics, we can group data into nominal, ordinal, internal, or ratio. This grouping impacts the type of analysis and, ultimately, the type of response we can give to a managerial question.

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