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If you watch some of the other movies in this chapter on data analysis, you saw that Excel has some pretty good tools to help you look at different possibilities and make decisions. What I want to do now is give you just a brief overview of a free add-in that comes with Excel called the Analysis ToolPak. If data analysis is something you need to do a lot of, you'll want to explore the ToolPak because it kicks these features up to a whole new level. We won't go into a lot of detail in this movie, but I want you to see what's there. But before we use it we have to enable it, because it's a plug-in. So, go up to the File tab to get into Backstage view and down here towards the bottom click Options.
And on the left we have all the different categories of options. Let's click Add-Ins down towards the bottom. Now, if you see the Analysis ToolPak here listed under Active, you don't have to enable it because it's already active. But you should see it over here under Inactive Applications. Now, if you don't see it at all it means that it's simply not installed and you have to get your original Microsoft Office discs and reinstall it. But if it's here, it'll probably show up as the first ones. By the way you notice there are two of them. There is the regular and there is the VBA. The VBA is for programming.
So, we're not going to look at that in this course. Make sure the regular Analysis ToolPak is selected. Go down here and click Go. And that brings up the little Add-Ins dialog box, and here we see the regular Analysis ToolPak, we see the VBA. So, just put a check there in the regular Analysis ToolPak and click OK. Now, what that does is this. Go to the Data tab and now on the right you see there is this Data Analysis item. So, I want to show you three of the tools in the Analysis ToolPak. Down here on the bottom we have three tabs and let's start in the Correlation tab, and what's happening here is we have two columns of random numbers.
And we're going to use the Correlation tool to correlate and see how random are these random numbers really. So, go up to Data Analysis and scroll if you need to, find Correlation, and click OK. So, it's asking for an Input Range, and the Input Range is over here. Let's select from B3 across and down to the bottom. So, we have both of the headers and we have all the numbers. Now, Excel correctly guesses that it's grouped By columns. We want to make sure that it recognizes that the first row are our Labels. And we want to put the results right over here.
So, click the radio button here for Output Range. Make sure to click in the box, make sure your cursor is there. And now let's click maybe on cell E3 for the Output Range, and click OK and deselect. So, now what it tells us it is correlating the first column with itself and correlating second column with itself. Of course it gives us 100% correlation. But when it correlates the two columns with each other, that's a pretty low number. Now, in real life you probably couldn't careless about ranking random numbers, but what you might be doing is your Two Trees Olive Oil Company is selling say two different products to customers, and you might want to see well, does the sales of one product have anything at all to do with the sales of another product? Maybe you're selling garlic olive oil, and you're also selling olive oil infused shampoo, and do the sales of shampoo have anything at all to do with the sales of your garlic olive oil? So, that's where I think you might find this useful.
So, let's take a look at moving averages. Now, here we can see by month from January to August we're selling our 6-ounce size of olive oil shampoo, and we have our totals here. This will be the input. What we want to do is take a moving average, and we want to find from one month to the other, what is the average sale? So, let's go back to Data Analysis and scroll if you need to and find Moving Average. Click OK and I'll just move this here out of the way. So, click here in the Input Range, and for the Input Range select just these numbers.
I'm not selecting the Total column header, because there's this blank row and I don't want to average in a zero. And you certainly don't want to select that calculated field. So, make sure Labels in First Row is deselected for this example. Now, what the Interval is-- and I'll leave this blank. This will let you have a greater or fewer numbers of months to compare with each other. But let's click over here in Output Range. And Output Range, we'll click right there on F6, so we'll have the range here right next to the input, and while we're at it put a checkbox in here for Chart Output. Click OK.
So, now what we see is the first two kind of look like an error, and the reason we're doing that is because you have to start somewhere and you can't average a number with something before it that doesn't exist. So, here are the Moving Averages for the rest, and the real nice analysis part in this chart is we can see the blue line is the actual sales and by using that Moving Average we can predict on the red line what our sales will be in the future. So, now let's go to the Rank tab. In the Rank tab our olive oil company is selling to supermarkets.
Rght, where the wholesaler and the supermarkets are selling your product. Now, right now you can see the supermarkets are listed in alphabetical order, and we have whatever their purchases are. Now you might say "well, hey no big deal. I could just with one or two clicks sort by Purchases." But what the Data Analysis tool will let you do is give them ranks by percentile. So, let's go back once again to Data Analysis, scroll down and choose Rank and Percentile, and click OK. So, the Input Range will be, including the label Purchases down to the bottom, and instead of scrolling I'm just going to press Ctrl+Shift and then the Down Arrow key on the keyboard, so I have them all selected and just scroll up.
So, we're grouped by columns. That's correct. Label is in the first row. That's right. Now, we want to put the Output Range right over here. So, click this radio button for Output Range, make sure to click in the box, and then let's click right over here on cell C3, and it will just populate down that column, and click OK, and scroll up. Now, this is great but we're not quite finished. Column C is the Point and the Point is simply what is the original position of the supermarket name.
So for example, this point number 1 is Allbearson's supermarket, and point number 18 is whatever is number 18 down on the list. Now the Purchases in Column D is redundant. It's the same thing as what's happening in Column B, but now we have the Rank and we have the Percentile. What we want to do is re-sort this selected area so that we get some useful information out of it. So, make sure it's still selected. If you deselected it, you want to reselect. Let's go back to the Home tab over here to Sort & Filter and choose Custom Sort.
What we want to sort by is Point. We want to sort Values and Smallest to Largest, so that will make these four columns match the original two columns. Click OK and now we can see okay, this is supermarket number one, this is supermarket number two, and so on. Well, I said before the Column C and D were redundent, so we don't need them anymore. Put your mouse pointer up here on the header for Column C so you have that down-pointing arrow, just click-and- drag to Column D ,right-click and Delete. Now we have some useful information. But let's go and format these headers. Click on one of these green headers here, and in the Home tab get the Format Painter and just drag over here.
Okay, now let's do something useful. Let's sort by Rank. Click anywhere in the Rank column, Sort & Filter, maybe Smallest to Largest. So, keep in mind Smallest Rank is the highest amount. So we see Snob Hill Market is our best customer. Here in the purchases they are in the 100 percentile, or maybe we want to sort Largest to Smallest. And let's go and sort alphabetically again. Click somewhere in Column A, go to Sort & Filter, Sort A to Z and here we have an original alphabetical order, so we could see our first supermarket in the list is our number 4 best customer.
So, you might need only one or two of the tools in the Analysis ToolPak, but knowing how those work can save you a tremendous amount of time over doing it manually.
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