When you're confronting a business problem or making a major decision, an analytical report can help you make sense of historical data and craft a new strategy for the road ahead.
Use this guide to help you prepare your own analytical reports, so you can make data-driven decisions that enhance the performance of your business.
What is an analytical report?
An analytical report (sometimes called a "data analysis report" or an "analysis report") is a type of business report that aims to analyze and interpret quantitative company data. Typically, the end goal is to present actionable insights to assist in making key business decisions.
A well-written analytical report can:
- Offer decision-makers predictive analysis about what to expect in the future
- Help you weigh the options when you're considering a major decision
- Provide end-to-end visibility of your company's important data
- Present data using charts, graphs, and other data visualization tools
Since an analytical report is designed to improve internal business intelligence, it will rarely be circulated outside of your workforce. Analytical reports will often be reserved for a small audience, providing data analysis for use in meetings and strategy sessions.
Analytical reports vs. informational reports
Many businesses create reports for a variety of reasons and circumstances. The two main types of reports are analytical reports and informational reports.
Informational reports are designed to report the facts and nothing more. An analytical report, by contrast, is designed to interpret data and will usually suggest solutions for a specific issue.
In other words, while an informational report is designed to be merely descriptive, an analytical report is designed to be prescriptive. It analyzes complex data and offers proposed solutions so that company leaders can make informed decisions about the future.
The format of an analytical report
Analytical reporting can take many forms, but every completed report will have the following components:
- A title page reflecting the main topic of the report
- A table of contents
- A paragraph explaining research methods
- An introduction, articulating your main idea
- The main discussion broken into paragraphs with headings and subheadings
- A conclusion, including recommendations and next steps
- A bibliography or appendix showing sources or additional data
When you write an analytical report, the length can vary considerably. The key is to stay organized and break lengthier sections into smaller, digestible pieces. Use headings and subheadings to separate report sections, and make use of charts and other visuals to help readers get a better understanding of the information gathered in your document.
How to write an analytical report
Ready to write your first analytical report? Here are the steps you'll take to write an analytical report for your company.
1. Identify the problem
Start by focusing on a single, clearly-defined problem. What specific issue is affecting your company? Who is affected by this problem?
For instance, you might think about questions like:
- How can we improve the conversion rate in our digital marketing channels?
- How can we increase total revenue in the next quarter?
- What prevented you from meeting a sales target in the previous quarter?
Your goal is to analyze the data to answer this question and provide some possible solutions for the future.
2. Perform careful research
Your next step will be to gather data. You might start by gathering historical data from the company itself. Ask your management team if there have been any other reports written on a similar issue.
When analyzing current data, you might gain access to data provided by different departments within your organization. But you might also consider outside sources, such as business news websites, reference books, or industry publications.
3. Write the main discussion first
As you gain more data to work with, you can start to organize and assemble the relevant information into a usable report.
At the same time, analytical reports are not meant to be a collection of raw facts. You'll want to pull key data insights and speak meaningfully about what they might mean for your company and business processes.
The body of your report can become lengthy if you're not careful. Break up your discussion by using headings and even subheadings. Aim for at least three headings in your report. Each heading should address a unique aspect of the original problem your report is analyzing.
You can also present data insights using charts or graphs. Many chart types are helpful when making comparisons between different metrics. For example:
- Bar graphs can be helpful when showing comparisons between sales of various products
- Line graphs can be helpful for showing changes in sales over time
- Pie graphs can be helpful for showing how your resources are allocated
These visuals help create reports that tell a compelling story about your company's history — and its future.
4. Create action steps and write your conclusion
Once you've completed your detailed analysis, you'll want to draw up some clear action steps. This work can be challenging, but it's important when your report is used as part of a larger decision-making process.
Think about questions like:
- How does this historical information affect the company today?
- How does the data influence our current business processes?
- When might the business strategy need to change based on this data?
Some management teams assign analytical reports to lower-level staff members, empowering them to participate in corporate decisions. If you're in that position, make sure that your final report contains multiple options rather than a single master plan. Always base your recommendations on clear data, which you'll reference throughout your analytical report.
5. Write a compelling introduction
Once you're finished, create a compelling introduction. Be sure to include a clear statement of the problem you want to address. It's also helpful to surface the "pain points," meaning any related circumstances the company is struggling with—often the same ones that prompted the analysis in the first place.
6. Insert a paragraph regarding research methods
The most time-consuming parts of your report are now behind you, but you still need a few more items to finish out the structure.
Start by including a paragraph concerning your research methods. How did you go about gathering and analyzing the data? You might mention traditional methods such as customer surveys or periodicals, but you should also talk about your strategy for extrapolating that data to determine your company's likely future.
7. Place references and additional data in the bibliography or appendix
Always validate your claims. Your analytical report should contain footnotes or endnotes that support your research. For electronic sources, include the website's publication date, the URL, and the date you originally accessed the information.
You may also have other relevant data that was interesting but not vital to the report. If you do, include additional detail in a separate appendix. In the main body, you can summarize this data briefly, then refer readers to the appendix for a thorough look.
8. Organize your report and create your table of contents
Numbering your pages or slides will make it easier for readers to use your analytical report during a team meeting. You'll also use these page numbers to create a table of contents, which will go toward the beginning of your finished document.
9. Create a title page
Give your analysis report a title page. Be sure to include:
- The title of the report
- The date the report was completed
- Your name and the names of any other contributors
- Your company logo
Assuming you can choose your own title, pick one that directly relates to the problem you're focusing on. This approach will help readers instantly understand what they'll be reading.
10. Review before submitting
Finally, review the finished document. You might even ask someone to read it over for you to ensure that your writing is clear and to the point.
Tips for optimizing your analytical reports
How can you create the best, most dynamic analytical reports? Follow these suggestions.
Know your audience
After swimming in data, it's important to adapt your writing style to an audience who might not have the same level of familiarity. If you work for a digital marketing agency, for example, you don't want to write as if you're a data scientist. Keep it simple, and make sure to explain unfamiliar terms.
Additionally, it's important to know whether your audience is likely to agree with your conclusions. When dealing with a receptive audience, you may want to refer to your conclusions throughout your report.
However, if you expect your audience to respond negatively, save your proposed solutions for the very end. That way, you can build consensus about the underlying realities step by step, leading your audience through the analysis that ultimately led to your conclusions.
Use the right KPIs
During the analytical reporting process, you'll need to rely on key performance indicators (KPIs) to assess your company's historical performance. But you'll likely encounter so much data that you'll need to sift through and find the right metrics.
For instance, if you're trying to analyze your customer conversion rate based on your marketing efforts, you don't need to include customer call data from your support center. Staying focused on the right KPIs will ensure that your report only includes the most relevant data.
Avoid using too many charts
Charts and graphs are helpful, but only when the data presented is meaningful to your discussion. Try to aim for only one chart per heading, though there may be times when additional data will be necessary. Remember, don't just present the facts to your audience — the point of an analytical report is to tell them what the facts mean for the business.
Think stories, not data
When you craft your analytical report, you need to be a data analyst as well as a storyteller. That is to say, you need to think in terms of the broader meaning for your business.
A useful way to think about this is to frame the discussion in terms of three things:
- Problem
- Solution
- Application
The introduction will present the problem, while the main body analyzes the problem, leading the reader toward the solutions . Your conclusion then discusses those solutions and their potential application, helping your readers visualize what the business might look like with those solutions in place.
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Analytical report FAQ
Here are some answers to frequent questions about analytical reports.
Who reads an analytical report?
Your audience will vary. If your report relates to a key aspect of your business, it may be read by department heads or even your company's top decision-makers.
Sometimes, analytical reports may be presented to current or potential customers to highlight your company's advantages and success rates.
When do I need to create an analytical report?
The best time to craft an analytical report is when:
- Your company is facing a specific challenge or setback
- You need to make a difficult or important decision
- Your managers need to understand the company's historical performance
For example, if you're considering exploring new marketing channels, an analytical report can help you make sense of your past performance and chart a course for the future.
How long should my analytical report be?
Every situation is different. Your analysis could summarize the data from a single spreadsheet, or it could address a more complex issue. Use headers to break up longer reports, and don't be afraid to relegate less important details to the appendix.
