Business data analytics combines business intelligence, data science, statistics, and business analysis techniques to reveal patterns or trends and predict business performance.
You've probably heard the saying that "data is the new oil." While it's not new, it's truer now than ever. In a world where everyone has a smart device in their hand or home, the most successful companies are the ones using that data to fuel innovation and power better decision-making.
So, how do you harness that power to predict the future of business?
Much like oil, the trick with data is to refine it and turn it into something you can use. Just like how Netflix takes the watching and browsing habits of their 221 million subscribers and turns that into their top streaming original shows and movies. Or how retailers like Starbucks use apps and web tracking to monitor buyer behaviour and send personalised offers. Then there are the companies like Twitter and Facebook using algorithms to trawl through the millions of daily posts to find and block potentially harmful content.
The biggest challenge for data analysts lies in the sheer volume of data points that we now have access to, thanks to cloud computing and artificial intelligence technologies.
In 2020, while we were all working, streaming, and shopping from home, the amount of data we created and consumed reached an all-time high of 64.2 zettabytes. That's 6.4 trillion gigabytes and more movies, memes, ads, and cat videos than most of us could digest in an entire lifetime.
With that number projected to increase to more than 180 zettabytes over the next five years, the demand for business data analysts will continue to grow.
Business data analysts – the Sherlock Holmes of Data
To combat the big data explosion, a business data analyst is the hero we need. They combine the expertise of statistical modelling and data science with business intelligence and analysis techniques.Along with technical skills like using database tools and programming languages to collect and process data sets, business data analysts provide the business context.
They have a holistic view of the business and the soft skills needed to collaborate with key stakeholders and influence decision-makers.They first define the business problem or opportunity that they want to use data to solve. Then they can guide the research and data gathering process.
Defining the problem-state upfront helps when turning data into actionable insights.
What techniques do business data analysts use?
In its Guide to Business Data Analytics, The International Institute of Business Analysis (IIBA®) outline the four different types of analytic methods.
1. Descriptive analytics involves going through and summarising current and historical data to paint a picture of the present state of your business. This could include old sales data or current market trends.
2. Diagnostic analytics explores the reasons why a specific event occurred. You might be looking at why revenue dipped in a particular quarter or what could be motivating customers to leave your website.
3. Predictive analytics uses statistical modelling, forecasting, and machine learning to analyse past trends and provide future insights. For example, you might use it to predict likely profit and loss.
4. Prescriptive analytics uses the findings from the other forms of analysis to recommend the best solutions. It involves testing to put data into action while anticipating what is likely to happen. That could mean predicting the outcome of increasing marketing spend by a certain amount or launching in a new market at the right time.
In the digital data age, analysts that can use their creativity and curiosity to translate data into business growth will be indispensable. Every organisation, from new start-ups to established businesses, need to be leveraging data to streamline their processes, improve their customer experience and stay ahead of industry trends.
If you want to be the hero of your own data analysis story, you can start your journey by checking out our Introduction to Business Data Analytics course.
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