Business Analytics

What is business analytics?

Business analytics (BA) is a set of disciplines and technologies for solving business problems using data analysis, statistical models and other quantitative methods. It involves an iterative, methodical exploration of an organization's data, with an emphasis on statistical analysis, to drive decision-making.

Business analytics (BA) is a set of disciplines and technologies for solving business problems using data analysis, statistical models and other quantitative methods. It involves an iterative, methodical exploration of an organization's data, with an emphasis on statistical analysis, to drive decision-making.

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.

Initial analysis is typically performed on a smaller sample data set of data. Analytics tools range from spreadsheets with statistical functions to complex data mining and predictive modeling applications. Patterns and relationships in the raw data are revealed. Then new questions are asked, and the analytic process iterates until the business goal is met.

Deployment of predictive models involves a statistical process known as scoring and uses records typically located in a database. Scores help enterprises make more informed, real-time decisions within applications and business processes.

Types of business analytics

Different types of business analytics include the following:

  • descriptive analytics, which tracks key performance indicators (KPIs) to understand the present state of a business.
  • predictive analytics, which analyzes trend data to assess the likelihood of future outcomes.
  • prescriptive analytics, which uses past performance to generate recommendations for handling similar situations in the future.

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