Business Analytics

Tools & Techniques

Business Analytics
Business analytics combine different strategies and tools to improve the performance of an enterprise. These form part of the management system and embody the particular approaches which the company adopts. Business analysts must be well-versed with techniques in business analysis which can be used in addressing current problems. There are numerous methods in quantitative analysis. Yet, there are primary strategies which are recognized as valuable for most business owners.

Business Users & their Challenges

The time to perform the overall cycle of collecting, analyzing, and acting on enterprise data must be reduced Clear business goals & metrics must be defined Analysis results must be distributed to a wider audience Data must be integrated from multiple sources Acceptance criteria of the analytics models must be clearly stated

Difference Between Business Intelligence and Business Analytics

While the terms business intelligence and business analytics are often used interchangeably, there are some key differences:

BI vs BA Answers the questions:

Business Intelligence What happened? When? Who? How many?

Business Analytics Why did it happen? Will it happen again? What will happen if we changex? What else does the data tell us that never thought to ask? Statistical/Quantitative Analysis Data Mining Predictive Modeling Multivariate Testing

Includes:

Reporting (KPIs, metrics) Automated Monitoring/Alerting (thresholds) Dashboards Scorecards OLAP (Cubes, Slice & Dice, Drilling) Ad hoc query

TECHNIQUES

Business Analytics
The MOST technique is an internal analysis. It contains four attributes that are defined by the business analyst to ensure the project you are working on is aligned and on track. These attributes are as follows:

MOST Technique
Mission or the direction of the business; Objectives referring to the objectives that will help achieve the mission; Strategies or the different options to move forward; Tactics or how different strategies are implemented.

Business Analytics
The PESTLE technique is an external analysis designed to scrutinize the various external elements affecting a business and its operations. It includes six attributes:

PESTLE
Political (present and future political influences) Economic (impact of local, national and global economy) Sociological (various ways society can affect any organization) Technological (effect of new and emerging technologies) Legal (effect of national and world legislation) Environmental (issues on local, national and world environment)

Business Analytics
CATWOE is a technique used to encourage critical thinking about what the business is trying to achieve. There are six different elements included in this technique:

CATWOE
Customers (benefits derived from high-level business process and corresponding effects) Actors (individuals involved in the situation and solutions for success) Transformation Process (processes or systems are affected by the issue) World View (big picture and broader impacts of the issue) Owner (process or situation being investigated and roles in the solutions) Environmental Constraints (limitations that will impact the solution and its success)

Business Analytics
A SWOT analysis provides a complete overview of both internal and external factors affecting a business. There are four attributes to SWOT:

SWOT Analysis
Strengths (examine the strengths of the organization) Weaknesses (know the downsides that you will be encountering) Opportunities (take advantage of the opportunities that come along the way) Threats (neutralize possible threats that may come about)

Business Analytics
Five Whys:
This technique is used to get to the root of what is really happening in a single instance. For each answer given a further why is asked.

APPLICATION

Application of Business Analytics

Business analytics comprises a great many techniques that deal with statistics. The most commonly used of these are product tracking systems and surveys. When these techniques are applied accurately, they open up numerous avenues of opportunity for organizations to optimize and augment their business model. A few such possibilities are explored in the following slides:

Spectrum of Analytics Applications

Spectrum of Analytics Applications

Application Of Business Analytics

Critical product analysis
Data retrieved from various markets can indicate how well a product is received by the target audience and also what crucial changes must be made to it to maximize revenue. Furthermore, the organization can gain insight as to how a particular territory or market reacts to certain features of the product. This not only makes it possible to make minor alterations to the item for specific locations but also helps in studying trends associated with those regions.

Improved customer service

Organizations have learned through experience to keep track of their recurring customer queries and support issues. This tremendously helps them in enhancing performance by not repeating past mistakes while also enabling them to provide faster customer service and satisfaction.

Application Of Business Analytics

Up-selling opportunities
Tracking trends in customer behavior can be very helpful in identifying the most prominent needs of a company's customer base, hence allowing it to up-sell or crosspromote products that cater best to customers' needs.

Simplified inventory management

This is an often ignored yet very efficient application of business analytics. With the help of trend-tracking, business managers can minimize write-offs to a great extent, in turn, minimizing losses due to outdated inventory items. For example, analytic data gathered beforehand can help predict which products are on the verge of going obsolete in the near future. With this information, those specific products can be gotten rid of before they end up as write-offs.

Application Of Business Analytics

Competitive pricing insights

This is yet another important highlight of business analytics that is ironically used by very few players in the game. Companies are known track trends in purchasing behavior among customers to figure out price ranges that the target market is most comfortable in. Thus, businesses can effectively make their prices competitive without having to cut down too much on profits.

TOOLS

Business Analytics Tools

SAS R Excel STATISTICA Weka MATLAB Salford Systems

Tools: SAS
SAS Analytics provide an integrated environment for predictive and descriptive modeling, data mining, text analytics, forecasting, optimization, simulation, experimental design and more.

From dynamic visualization to predictive modeling, model deployment and process optimization, SAS provides a range of techniques and processes for the collection, classification, analysis and interpretation of data to reveal patterns, anomalies, key variables and relationships, leading ultimately to new insights and better answers faster.

Tools: R
R is a statistical tool/platform/programming language which is free and open-source. It is built by academicians/statisticians who continuously provide libraries (customized functions) for new and emerging statistical techniques. Cutting-edge statistics with 'R R has powerful graphics capabilities. R is available for Windows, Linux and Mac OS. 'R' is a great tool for creating complicated plots and charts which are publication quality. R can be used to provide analytics on the Web R is used in Government regulated clinical research in the US and has approval of the FDA.

Tools: Excel
Excel is the worlds leading tool for data manipulation, analysis, management and reporting. The breadth of functions and tools available in Excel offers users wideranging flexibility. Business Analytics in Excel brings an end to ineffective Excel usage by providing a structured step-by-step approach to the analytical process; from the initial importing of raw data to Excel to the final stage of extracting and reporting results.

Key Challenges Of Business Analytics

Strategic Alignment Agility Commitment

Information Maturity

Challenges
Strategic Alignment: Most organizations today already have some element of business analytics in place, often in the BI/data warehousing area. Unfortunately analytics are often viewed by top executives as esoteric research at best, and irrelevant fringe experiments at worst. The issue surrounds not a lack of appreciation for the usefulness of information but a lack of alignment, availability, and trust.

Challenges
Agility: Typically in the organizations, the analysts are organized by business domains. Findings working with top-tier, information-driven companies demonstrate that domain-based organizations are not the most effective approach for analytics. Analysts often work independently and create models in ad-hoc environments based on a patchwork of extracts and sources. The results, while advanced and valid, are not easily communicated to the business users for whom they would provide the greatest value.

Challenges
Commitment: Analytics software packages often come as prefabricated solution and are not particularly difficult to implement; however they can be costly, and the ROI is not immediate. By their nature, analytical models will improve in accuracy over time as the predicted results are compared with actual events hitting the warehouse. But this is a complex endeavor that requires dedication to the solution during an extended tuning period. Here is where many deployments fail. Business users do not immediately see the promised results and lose interest, and executives lose trust in the solution and refuse to rely on what the models tell them.

Challenges
Information Maturity: Implementations often fail because of the lack or low quality of underlying transactional data. Either data are not available, data sources are too complex, or data are poorly mastered. Even bleeding-edge, sentiment- and context-analysis tools require some level of trust in the data, and for any analytical model the rule is consistent: the more trustworthy the data the more trustworthy the result.