Introduction

Analytics is a field which combines data, information technology, statistical analysis, quantitative methods and computer-based
models into one.

This all are combined to provide decision makers all the possible scenarios to make a well thought and researched decision. The
computer-based model ensures that decision makers are able to see performance of decision under various scenarios.

Meaning

Business analytics (BA) is a set of disciplines and technologies for solving business problems using data analysis, statistical
models and other quantitative methods.
At its core, business analytics involves a combination of the following:

 identifying new patterns and relationships with data mining;

 using quantitative and statistical analysis to design business models;

 conducting A/B and multi-variable testing based on findings;

 forecasting future business needs, performance, and industry trends with predictive modelling; and

 Communicating your findings in easy-to-digest reports to colleagues, management, and customers.

Definition

 Business analytics (BA) refers to the skills, technologies, and practices for continuous iterative exploration
and investigation of past business performance to gain insight and drive business planning.

 Business Analytics is the process of transforming data into insights to improve business decisions. Data
management, data visualization, predictive modelling, data mining, forecasting simulation, and optimization
are some of the tools used to create insights from data.

 How business analytics works

Before any data analysis takes place, BA starts with several foundational processes:

 Determine the business goal of the analysis.

 Select an analysis methodology.

 Get business data to support the analysis, often from various systems and sources.

 Cleanse and integrate data into a single repository, such as a data warehouse or data mart.

 Need/Importance of Business Analytics

 Business analytics is a methodology or tool to make a sound commercial decision. Hence it impacts
functioning of the whole organization. Therefore, business analytics can help improve profitability of the
business, increase market share and revenue and provide better return to a shareholder.

 Facilitates better understanding of available primary and secondary data, which again affect operational
efficiency of several departments.

 Provides a competitive advantage to companies. In this digital age flow of information is almost equal to all
the players. It is how this information is utilized makes the company competitive. Business analytics
combines available data with various well thought models to improve business decisions.

 Converts available data into valuable information. This information can be presented in any required format,
comfortable to the decision maker.

For starters, business analytics is the tool your company needs to make accurate decisions.
While some companies are unsure what to do with large amounts of data, business analytics works to combine this data with
actionable insights to improve the decisions you make as a company

Essentially, the four main ways business analytics is important, no matter the industry, are:

 Improves performance by giving your business a clear picture of what is and isn’t working

 Provides faster and more accurate decisions

 Minimizes risks as it helps a business make the right choices regarding consumer behaviour, trends, and
performance

 Inspires change and innovation by answering questions about the consumer.

Benefits of implementing BA in your organization

Apart from having applications in various arenas, following are the benefits of Business Analytics and its impact on business –

 Accurately transferring information

 Consequent improvement in efficiency

 Help portray Future Challenges

 Make Strategic decisions

 As a perfect blend of data science and analytics

 Reduction in Costs

 Improved Decisions

 Share information with a larger audience

 Ease in Sharing information with stakeholders

 Challenges
Moreover, any technology is subject to its own set of problems and challenges. Following are the challenges in implementing
business analytics in an organization.

 Lack of technical skills in employees

 Fuss over acceptance of BA by staff

 Data Security and Maintenance

 Integrity of Data

 Delivering relevant information in the given time

 Inability to address complex issues

 Costs involved in implementing BA

 Investment of staff time in implementation of BA

 Lack of a proper strategy to implement BA

 Business analytics can be possible only on large volume of data. It is sometime difficult obtain large volume
of data and not question its integrity.

 Business analytics depends on sufficient volumes of high-quality data.

  The difficulty in ensuring data quality is integrating and reconciling data across different systems, and then
deciding what subsets of data to make available.

 Previously, analytics was considered a type of after-the-fact method of forecasting consumer behaviour
by examining the number of units sold in the last quarter or the last year. This type of data warehousing
required a lot more storage space than it did speed.

 Now business analytics is becoming a tool that can influence the outcome of customer interactions. When a
specific customer type is considering a purchase, an analytics- enabled enterprise can modify the sales pitch
to appeal to that consumer. This means the storage space for all that data must react extremely fast to
provide the necessary data in real-time.

Application

Business analytics has a wide range of application from customer relationship management, financial management, and
marketing, supply-chain management, human- resource management, pricing and even in sports through team game strategies.

In healthcare, business analysis can be used to operate and manage clinical information systems. It can transform medical data
from a bewildering array of analytical methods into useful information. Data analysis can also be used to generate contemporary
reporting systems which include the patient's latest key indicators, historical trends and reference values.

 Decision analytics: supports human decisions with visual analytics that the user models to reflect reasoning.

 Descriptive analytics: gains insight from historical data with reporting, scorecards,
clustering etc.

 Predictive analytics: employs predictive modelling using statistical and machine learning techniques
  Prescriptive analytics: recommends decisions using optimization, simulation, etc.

 Behavioural analytics

 Cohort analysis

 Competitor analysis

 Cyber analytics

 Enterprise optimization

 Financial services analytics

 Fraud analytics

 Health care analytics

 Key Performance Indicators (KPI's)

 Marketing analytics

 Pricing analytics

 Retail sales analytics

 Risk & Credit analytics

 Supply chain analytics

 Talent analytics

 Telecommunications

 Transportation analytics

 Customer Journey Analytics

 Market Basket Analysis

Business analytics is also known as data analytics. It is a process of collecting, evaluating, and drawing valuable outcomes from
the enormous amount of data available. Business analytics is widely used in the following applications:

 Finance

 Marketing

 HR

 CRM

 Manufacturing

 Banking and Credit Cards

Business analytics is performed by Data Scientists and Data Analysts.

4 Types of Business Analytics
There are mainly four types of Business Analytics, each of these types are increasingly complex. They allow us to be closer to
achieving real-time and future situation insight application. Each of these types of business analytics have been discussed below.

1. Descriptive Analytics
2. Diagnostic Analytics
3. Predictive Analytics
4. Prescriptive Analytics

Descriptive Analytics
It summarizes an organisation’s existing data to understand what has happened in the past or is happening currently. Descriptive
Analytics is the simplest form of analytics as it employs data aggregation and mining techniques. It makes data more accessible to
members of an organisation such as the investors, shareholders, marketing executives, and sales managers.

It can help identify strengths and weaknesses and provides an insight into customer behaviour too. This helps in forming
strategies that can be developed in the area of targeted marketing.

Diagnostic Analytics
This type of Analytics helps shift focus from past performance to the current events and determine which factors are influencing
trends. To uncover the root cause of events, techniques such as data discovery, data mining and drill-down are employed.
Diagnostic analytics makes use of probabilities, and likelihoods to understand why events may occur. Techniques such as
sensitivity analysis and training algorithms are employed for classification and regression.

Predictive Analytics
This type of Analytics is used to forecast the possibility of a future event with the help of statistical models and ML techniques. It
builds on the result of descriptive analytics to devise models to extrapolate the likelihood of items. To run predictive analysis,
Machine Learning experts are employed. They can achieve a higher level of accuracy than by business intelligence alone.

One of the most common applications is sentiment analysis. Here, existing data collected from social media and is used to
provide a comprehensive picture of an users opinion. This data is analysed to predict their sentiment (positive, neutral or
negative).

Prescriptive Analytics
Going a step beyond predictive analytics, it provides recommendations for the next best action to be taken. It suggests all
favourable outcomes according to a specific course of action and also recommends the specific actions needed to deliver the
most desired result. It mainly relies on two things, a strong feedback system and a constant iterative analysis. It learns the
relation between actions and their outcomes. One common use of this type of analytics is to create recommendation systems.
Business Analytics Tools

Business Analytics tools help analysts to perform the tasks at hand and generate reports which may be easy for a layman to
understand. These tools can be obtained from open source platforms, and enable business analysts to manage their insights in a
comprehensive manner. They tend to be flexible and user-friendly. Various business analytics tools and techniques like.

 Python is very flexible and can also be used in web scripting. It is mainly applied when there is a need for
integrating the data analyzed with a web application or the statistics is to be used in a database
production. The I Python Notebook facilitates and makes it easy to work with Python and data. One can
share notebooks with other people without necessarily telling them to install anything which reduces
code organizing overhead

 SAS The tool has a user-friendly GUI and can churn through terabytes of data with ease. It comes with an
extensive documentation and tutorial base which can help early learners get started seamlessly.

 R is open source software and is completely free to use making it easier for individual professionals or
students starting out to learn. Graphical capabilities or data visualization is the strongest forte of R with R
having access to packages like GGPlot, RGIS, Lattice, and GGVIS among others which provide superior
graphical competency.

 Tableau is the most popular and advanced data visualization tool in the market. Story-telling and
presenting data insights in a comprehensive way has become one of the trademarks of a competent
business analyst Tableau is a great platform to develop customized visualizations in no time, thanks to the
drop and drag features.

Python, R, SAS, Excel, and Tableau have all got their unique places when it comes to usage