Why Business Analytics is Such a Big Deal
But to effectively use this growing flood of information, each organization needs to have some methods and tools in place for leveraging business analytics.
What is Business Analytics?
Business analytics is any use of data to gain insights. It's an attempt to explore available information with the objective of using statistical analysis to improve operations. Business analytics software is intended to facilitate the collection, review, and evaluation of data in useful ways.
Analytics might be referred to as business intelligence, but there are some differences. BI focuses on establishing and using quantified metrics to evaluate performance. Conclusions coming from business intelligence can be used to direct company efforts and influence decisions. However, business analytics uses a range of metrics and factors to provide results focused on predicting future behaviors rather than analyzing past events.
Business analytics is typically a more comprehensive process calling for complex algorithms. It provides for a wider set of business applications. About 46 percent of companies have utilized cloud-based analytics. While many business are now recognizing the potential of data analytics, understanding and using the analytic tools is a separate issue.
The benefits of analytics:
Analytic software applications will provide different capabilities for different business needs. Some of the available tools are designed for inventory management, guiding software releases, social media campaigns, or extrapolating industry data to find consumer buying trends. Some tools may be engineered to identify cyber threats, or collect insights into every phase of the sales cycle. One tool may be ideal for solving manufacturing issues while another is developed to focus on competitor marketing techniques. It's important that each business identify the right tool that will fit its own data mining needs.
Most analytic tools will include data mining features, but selecting a tool that performs ideally for your specific business requirements is an important step. Data mining techniques can enable you to drill down into low level details, or roll-up facts into aggregate summaries at various levels. Data mining can create interactive reports to give business users different levels of transparency. The right reporting tools can save hours of effort over traditional methods of evaluating data. All of your staff basing their reporting off one consistent dataset can help to reduce misunderstandings. Successful data mining means that data can be filtered for different purposes. such as by location, date, price, product, and much more.
Unless you're using data analytics for your own purposes, in a company with multiple employees most business needs fall to teams or multiple department heads who have a need to coordinate and communicate to avoid wasted time and stay focused. Analytics software should allow efficient collaboration among users to be of value. The best analytics tool will provide a platform that's accessible to varied devices, and useable by employee at all levels of technical expertise.
Analytics software can be flexible and powerful, but it doesn't necessarily present results in a way that will be obvious or meaningful to its users, especially in more complex problems such as forecasting from a number of input factors. Users shouldn't have to take the time to interpret results or wait on re-crunching the figures. Graphics and data visualization such as charts or gauges are important elements that let everyone see results at a glance without the need for interpretation.
Every analytics tool is built on the premise that it can process large amounts of data to generate conclusions. For a tool to be of genuine value to a business, it should be able to take the next step and provide predictions or suggestions that you can actually put to use. Otherwise you're left with prospect of investigating the data yourself, and the analytics software is nothing more than a reporting tool. A business analytics tool worth the investment should be able to draw upon raw data to make clear, probable predictions of business events. It should also be able to identify means for handling these events as you go forward.
There are several advantages in accessing analytic tools over the cloud. This remote software can be accessed any time over the internet by any person or device with compatibility and permissions. This creates a more productive tool for home workers and mobile users. A central, cloud-based source also provides greater collaboration and data security. At the same time, it saves companies money over having to support the necessary hardware or software themselves. Cloud-based analytics are typically presented via paid subscription to form software as a service (SaaS). It's expected that 80 percent of enterprises plan on using Saas for some, if not all, content and services.
To the casual or untrained user, business analytics tools may seem largely the same. In concept, the are, but the differences between one tool and another have significant influences for your company. Using demo software, trial periods, and general research from both a business and user perspective can provide more confidence in the analytic software you choose.
Changing your business' mindset toward adopting analytics as a practice will only provide operational advantages. Even if there is a learning curve, the process of asking questions and validating the answers will get you on the right track to getting the full value from your data stores.
Data collection and analysis is what drives modern business success. Evaluating the tools you need to make informed business decisions is crucial to providing a competitive advantage and sustaining your business long-term.