In simple terms, we can define business analytics as the process of collecting data, processing it, analyzing it, and eventually deriving insights from it so that business decisions can be much more informed. It is extremely important in the present time as it serves as the report card of the performance of different businesses. No matter what the area of operation of a particular business is, it is extremely important that it makes effective use of business analytics to survive the boom and bust cycles of the market. It is in this context that businesses are looking to hire analytics professionals to monitor and manage their business. As the demand for analytics professionals keeps on increasing, the need for business analysis certification in India becomes much more pronounced.
In this article, we take a close look at this process and analyze it from an insider’s perspective.
Basic steps in business analytics: The process flow
We can understand this process with the help of ten simple steps.
- The first step involves the gathering of background information related to a particular process of a business that we want to evaluate.
- The second step is about the identification of different stakeholders in this process which can be followed by a consultative mechanism with these stakeholders.
- The third step is about the identification of business objectives that need to be considered in the process of analytics.
- The fourth step is the exploration of different options or pathways that can be adopted for carrying out the process of analytics.
- The fifth step involves the analysis of the different methodologies and techniques that are to be adopted during the process of analytics.
- In the sixth step, we prepare a business delivery plan so that the objectives that we highlighted earlier can be met using the methodologies that we have considered.
- The project requirements need to be underlined in the seventh stage with the aim of keeping track of the monitoring and management processes.
- In the eighth step, we carry out the implementation program and ensure that we come up with suitable findings for the process of analytics.
- In the 9th step, the findings need to be portrayed in a simple way so that all the stakeholders can be convinced about the efficacy of the analytics process.
- Finally, in the tenth step, a feedback mechanism is provided so that the opinion of the stakeholders can be taken into consideration and suitable amendments can be made.
An insider’s perspective on business analytics
This process starts from the understanding of the problem statement that is in question. One of the most orthodox approaches that are adopted by the business analyst is to break down the problem statement into smaller goals. This has two important advantages. The first advantage is that it allows all the stakeholders to discuss the goals of the project and underline the appropriate procedure to achieve these goals. The second important advantage is that the basic questions are answered if the problem statement is broken down into smaller parts. This leads to a time-bound completion of the project by adhering to smaller targets.
After the targets have been underlined, the next stage in the process is to structure the data and carry out the cleansing process. The cleansing process involves the removal of all outliers and the analysis of the missing values. After this, the basic process of computation and processing can be started.
In the next step, we adopt statistical methodologies to derive appropriate solutions to the problem statement. Some of the important methods include regression analysis so that predictions can be very accurate and precise. After this, the next job at hand is to derive actionable insights from data.
Insights and analysis
In the next stage, the insights and analysis that have been carried out in the previous stage are used for the process of decision-making. This is the most tricky part of the entire process. This is because it is important that only those data sets are used in the process of decision-making that can uncover relationships between various variables. Unnecessary information can work in a negative way for the decision-making process. It is highly likely that the model may lose its accuracy and precision if unnecessary information is used and unnecessary variables are incorporated.
We follow up the above steps with the process of optimization. This involves finding the best solution for the highlighted problem. The predictive model is applied to the test scenario and different limitations of the model are underlined. Appropriate measures are then taken to address the limitations of the model in an appropriate manner.
The next stage involves making use of analytics for the process of decision-making to meet the organization’s goals. This is also a time-bound exercise and marks the completion of the process. In addition to this, we can also incorporate an additional stage into the whole process. This stage is the stage of monitoring and feedback. The entire analytics process and the future course of action are recorded. Any modifications that can further improve the process are proposed.
Dimensions of business analytics
There are numerous dimensions of this process and the two most important ones among them include behavior analysis and cohort analysis. Other dimensions of the process include competitor analysis as well as cyber analytics. The dimensions continuously grow in scope as the domain of businesses enters into new sectors.
Consequently, the process that is carried out is shaped by the sector in which it is applied. For instance, when business analytics is applied in the healthcare sector, we call it healthcare analytics. Similarly, when it is applied in the financial sector, we call it financial analytics. The application of the process in the domain of retail and supply chain management is called retail analytics and even logistics analytics.
In the domain of e-commerce, business analytics is done in various degrees. For instance, the process that is carried out in the domain of e-commerce may be of the nature of predictive analytics or customer analytics. Both of these analytics processes are extremely important. In addition to this, pricing analytics and marketing analytics is also done in the domain of e-commerce in general and in the domain of omnichannel in particular. This process is extremely important for startups as well as businesses that are at their nascent stage of development.
The process of analytics allows startups to carry out enterprise optimization in an effective way. In simple terms, enterprise optimization refers to the appropriate use of the available resources to ensure sustained growth of a business in the long run. This not only applies to newly established startups but also to unicorns and other tech giants.
Business analytics is not a uni-dimensional process but a multi-dimensional phenomenon that holds the potential for catalyzing the growth of a business in the long run. It is extremely important that businesses give a lot of focus to this process for understanding the dynamics of the market and modifying their marketing strategies according to market behavior. By harnessing the potential of this process as well as its applications, businesses can witness the pinnacle of their growth prospects.