The demand for business analytics (BI) is at an all-time high. Businesses are being bombarded with data from every direction, so they need to be able to sort through it quickly to take full advantage. That’s where business analytics come into play. So let’s start by taking a closer look at what BI encompasses.
Analytics is the process of driving changes in business by using data as a means to determine the direction in which a company should move forward. In short, it transforms raw data into relevant information that executives then use to make important decisions.
Technically speaking, analytics combines management with technology to provide a higher level of understanding. It allows for more intelligent decisions to be made, replacing the past method of “following your gut.” Most analytical systems will create powerful visuals that can be used to predict future trends.
The full potential of data analytics will unlock the power of predictability. Being able to accurately predict outcomes will create higher profits and lowers the overall risk of an organization.
Here are some of the most popular methods of business analytics.
SWOT analytics tracks four specific categories – Strength, Weakness, Opportunities, and Threats. It allows the business to address concerns in each of those areas. Strength and weakness are internal to the business, while threats and opportunities are external factors. All four play a vital role in making profitable decisions. This is probably the simplest method of BI, making it the most popular choice for small businesses. It can also be used at any stage of growth.
Business Process Monitoring
Business process monitoring (BPM) is designed to help businesses improve their overall processes to maximize efficiency. It uses the following tactics:
· Analysis of Business Models
· Planning of Strategies
· In-Depth Technical Analysis of Complex Business Processes
· Defines and Designs New Business Processes
The biggest advantage of using the BPM technique is to dive deeper into the different roles involved in the business process. It’s used heavily in the IT industry and is considered one of the best forms of BI. BPM can transform complex BI systems into a more streamlined process.
This analytical method tracks the businesses mission, objectives, strategy, and tactics. It’s considered the most powerful form of BI and allows companies to track their overall objectives. In short, MOST analytics provides businesses with a clear path during growth and provides information that can be used to make adjustments as needed.
This process can be used to measure every level of business. It gives companies a way to focus on their overall mission.
Case modeling uses illustrations to detail how certain functions in business should work in comparison to how they are working. It’s mainly used during software development to create functional steps that can be used in existing systems.
One example of case modeling is a UML Use Case Diagram, where analytics are used to gauge how well a specific process is functioning within the company.
There are a lot of external factors that can influence the way a business needs to plan moving forward. PESTLE analyses these factors in-depth so they can be factored into decision-making as a business moves forward. PESTLE looks at:
· Political Influences
· Social Factors and Influences
· Legal Requirements and Regulations
· Environmental Influences
PESTLE analysis provides businesses with a blueprint for reducing potential threats associated with all of the above factors. It also opens up doors where companies can take advantage of those same influences.
This is a generic method that businesses use to analyze their overall goals. This system will gather data in different areas and find places where there might be problems. Then decision-makers can find solutions to these problems. What makes this method so valuable is that it looks at the processes from a stakeholder’s perspective and shows how the solution will impact them.
Benefits of Business Analytics
· Business analytics provides a streamlined way for businesses to track specific metrics that are unique to their market. With data coming in from all directions, it needs to be filtered and delivered in an easy-to-understand format.
· Business intelligence tools give companies an edge over their competition and level the playing field a bit for small businesses. Everyone has access to the same data related to trends and markets.
· Predictive modeling and analysis both offer timely and accurate predictions about market conditions that allow businesses to streamline their strategies. This improves the decision-making process, leading to better outcomes.
· Key performance indicators (KPIs) are the most important metrics that a business will need to track. Business analysis provides businesses with a way to track and visualize these key metrics.
· Another powerful benefit of BA is that it shows businesses why certain strategies have failed them in the past, thus allowing them to prevent making similar mistakes in the future.
Applications of Business Analytics
· Marketing: Business analytics has become essential to marketing since it can provide insight into a market’s behavior and market trends. It also helps businesses identify their target market and provides insight into new markets.
· Financial: BA tools provide businesses with a way to crunch all of their financial data and create a visual representation. This allows executives to see growth statistics.
· HR: Business intelligence tools are used to perform background checks and identify other risks/benefits of potential candidates.
· Manufacturing: Business analytics also plays a huge role in manufacturing by allowing businesses to manage inventory and track performance. Plus it is used as a tool to help decision-makers develop risk mitigation plans.
Business Analytics Provides a Huge Opportunity for Growth
Business analytics is the future of business, and the technology surrounding this process is only going to improve. Artificial intelligence and business intelligence have the potential to fully automate BI, presenting a huge opportunity for growth to companies that emphasize data. If your business is not data-centric, then consider bringing an outside provider like the Research Optimus Company to help bring your systems up-to-date.