As the fields of business intelligence and business analytics continue to develop and grow, organizations must be aware of the distinctions between the terms and understand their value. Adoption and usage of business intelligence and analytics tools show no sign of slowing. Understanding these concepts is vital to making the best business decisions, to maintaining a competitive edge across all industries, and to enabling companies to capture operational and strategic value.
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The goal of business analytics is to develop successful analysis models. It simulates scenarios to predict future conditions. It is a very technical approach to predict upcoming trends. This process helps find patterns after analyzing previous and current data. The analysis is used to devise future courses of action. Professionals working in this field use data mining, descriptive modeling, and simulations.
Business intelligence uses different types of software applications to analyze raw data. Professionals working in this field study business information. They closely consult with decision-making managers. They identify existing business problems and analyze past and present data to determine performance quality. They use KPIs and other metrics, and prepare easy-to-read reports. The reports give unique insights into the workings of the business and empower organizations to make optimum business decisions.
Business analytics experts help predict what is going to happen in the future. They use data to analyze what will happen under certain specific conditions. They can predict the next trends and outcomes.
Business intelligence experts, on the other hand, help track and monitor data and business metrics. They can correctly identify what happened and what is happening now. They can discover why something happened, how many times something happened, and when all such events took place.
Very few managers have high expertise in data fields because the use and analysis of big data has emerged only in the last few years. Even new managers and leaders do not have requisite skills to devise data-driven digital strategies. Most organizations need a new kind of talent base that is well versed in the data-driven business landscape. One McKinsey report estimates that by 2018, the US will face a shortage of 140,000–190,000 data science professionals. Even now, companies must pay very high salaries to employ data analysts. Only large companies can afford such professionals.
While 78% companies agree that big data will impact their business, only 58% think their company is ready to take advantage of all the potential that big data offers. The reason for this is not difficult to ascertain. Companies must use various techniques to capture data, and the data collected must be realized in a specific format. Data analysts must use exacting methods and processes to analyze this data. Capturing and analyzing big data is a complex process and can be handled only by trained data analysts.
Engaging effective business analytics is necessary to make the right business decisions. Managers with proven analytics skills are better able to plan for future projects. The biggest advantage involves forecasting. Analysis of previous and current data helps predict future trends. This information is crucial to the success of a business. A company may have different types of products. It may keep promoting the fast-selling product while another product that is quickly gaining traction may remain under the radar. Only big data analysis can reveal the importance of the latter product. Business analytics is a forward-thinking way to improve operational efficiency. Decisions can be made faster, and it becomes easier to make sense of large volumes of data.
Business intelligence proves useful in identifying new opportunities. A company can identify a new market that holds important business opportunities. Product pricing can be tweaked to market demands. Business productivity can be improved. Sales and marketing expenses can be optimized. Business intelligence helps predict customer behavior, which proves useful in improving customer service.
Even when the benefits are well known, very few companies are able to use big data analysis in a significant way. Almost 50% of businesses face difficulty in the field of business analytics. They are unable to ensure the quality of data. Without the right talent to manage and analyze data, they are at a disadvantage in the market. Many businesses rely on simple applications to analyze data. These tools are not very effective in analyzing big data. This type of data must be analyzed scientifically. It is a complex job that can be handled only by professionals who possess training and skills in data analytics.
All types of businesses are working continuously to take advantage of big data. They are using simple as well as complex solutions to work with such data. There is a consensus realization that a high level of data analytics is necessary to ensure business success in today’s market. Now, companies are incorporating data analytics into all their departments. They are using sophisticated tools and solutions to predict future trends. Almost 82% of business executives now take advantage of data-driven reports and dashboards.
Big data is obtained from a wide range of sources. Sales records and financial transactions generate a great volume of useful data. They help devise pricing models for different types of products. The customer database is a key source of data. Large amounts of contact details and other data can be mined from emails, productivity and communication applications. In fact, every business process generates data. All such data must be collected and stored properly.
Businesses need the services of both business analytics and business intelligence experts. There are differences in their positions, but both groups play important roles in the success of a business. As more and more businesses rely on digital strategies, they have to analyze their big data properly and effectively. They need the support of trained and skilled data analysts to help achieve the best business success possible.