Business Analytics is the combination of skills, technologies, tools, applications, and processes used by organizations to gain insight into their operations based on data and statistics to drive business planning and growth.
In today’s globally competitive environment, there is an ever-increasing need for advanced information and decision support systems. The profitability and the overall business can be managed better with access to predictive tools to predict, even approximately, the market prices of raw materials used in production, for instance. Business Analytics involves among others, quantitative techniques, statistics, data and analysis tools, and econometric models.
Business Analytics is a mixture of Data Analytics, Business Intelligence, and Computer Programming. It is the science of analysing data to find out patterns that will be helpful in developing strategies. Its usage can be found in almost every industry.
Types of Business Analytics
There are four types of business analytics and these analytics types are usually implemented in stages, starting with the simplest.
1. Descriptive Analytics
This tracks key performance indicators (KPIs) to understand the present state of the business. This is the simplest form of analytics and uses data aggregation and mining techniques. It describes or summarizes a business’s existing data to get a picture of what has happened in the past or is happening currently. It helps identify strengths and weaknesses and provide insight into customer behaviour
2. Predictive Analytics
This analyses trend data to assess the likelihood of future outcomes. It forecasts the possibility of future events using statistical models and machine learning techniques. Predictive analytics builds on descriptive analytics results to create models that can predict the likelihood of selected outcomes. A common use of predictive analytics is sentiment analysis. For example, existing text data collected from social media can be used to provide a comprehensive picture of opinions held by a specific user.
3. Prescriptive Analytics
This uses past performance to generate suggestions on how to handle related situations in the future. It goes a step beyond predictive analytics, providing real-time suggestions for next best actions, thereby allowing potential manipulation of events to drive better outcomes. Prescriptive analytics is not only capable of suggesting all favourable outcomes according to a specified course of action, but also recommending specific actions to deliver the most desired result.
4. Diagnostic Analytics
This moves away from the “what” of past and current events to “how” and “why,” key points. It focuses on past performance to determine which factors best have an impact on trends. It employs techniques such as drill-down, data discovery, data mining, and correlations to uncover the root causes of events. It uses probabilities, likelihoods, the distribution of outcomes to learn why events may occur and employ techniques including attribute importance, sensitivity analysis, and training algorithms for classification and regression.
Benefits of Business Analytics
There are a lot of benefits that businesses gain from business analytics, here are some of them:
1. Analytics Encourages Smart Decision-Making
Accessibility to useful and meaningful data gives companies the power to make accurate decisions that could leverage businesses. Not only that business analytics provide useful data, but it also allows companies to make decisions faster and more efficiently than ever before. Companies can increase the use of analytics when they share the discussion with as many employees as needed.
2. Analytics Helps Companies Avoid Being Left Behind
Business analytics can help companies to remain in the game and not get left behind. Using analytics allows businesses to create rolling forecasts of the business and of the market. These create valuable knowledge and analysis into what’s happening both internally and externally. Staying updated on the latest new forecasts can spark innovative ideas, bringing more reaches to a company’s brand. Improving processes paves the way for releasing innovative new products, services, and information. And that can help a company charge ahead of its competition.
3. Analytics Provides Clearer Insights Through Data Visualization
Recent analytics tools care about how you present your data to your company analytics team. Really detailed charts and graphs can be used to make sure that decision-making is more interesting. Through visual representations of extracted data, relevant and useful insights can be extracted in a much clearer way. With analytics data visualization tools, information that you need about your market is there on your table, Shown to you in a visually enticing and organized manner.
4. Analytics Offer Efficiency
Business efficiency has been improving a lot since the rise of business analytics, with the power to gather a large amount of data at a fast rate and present it in a compelling way, businesses can now make accurate decisions to help achieve set goals, Business Analytics also promote teamwork where staffs are able to express their thoughts and ideas in the decision-making process.
5. Increased Performance
Business Analytics can positively push business performance beyond executive experience or plain intuition.
6. Efficient Tracking
Business Analytics makes tracking and monitoring business processes extremely efficient and seamless, thereby allowing companies to handle even the most complex of business operations with ease.
Features of Business Analytics
There are a lot of features of Business Analytics, below are 6 features that an analytics tool for business analytics must have:
1. Easy to Use Interface
It should allow the user to carry out analytical operations on an easy to use and understand interface without the use of coding or programming.
2. Ready to Consume Insights
In today’s fast-paced business environment when a delay of seconds can dispel your customers, the tool should be able to deliver ready to consume business intelligence.
3. Ready to Use Insights
In today’s fast-moving business environment, a delay of seconds can make your customer leave, the tool should be able to deliver ready to use business insights.
4. Easy to Share
It should have easy and controllable sharing capabilities to deliver insights over the network in a large user environment.
5. Extensible Analytics
It should be extensible to enable customized analytics and new modules development for the changing business needs.
6. Accommodate Support
It should accommodate integration to other analytics or data visualization tools so as to enable seamless movement and compatibility of data to and fro.
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