This action might not be possible to undo. Are you sure you want to continue?
of all, a shortage of demand for experienced resources in the US and India. Are you better at analyzing numbers than shooting e-mails? Then careers in a niche industry like Database Mining & Analytics may just help get you there. Database mining and analytics are one of the new sunrise careers of not just the Indian economy but also the global digital economy. While careers in Database mining and analytics have typically been offered by the business process outsourcing sector under the sub-brand of Knowledge Process Outsourcing, increasingly robust demand for analytics professionals have prompted both Information Technology firms and domestic firms based in India. Database mining and analytics are defined as using the power of hidden information locked in databases to reveal consumer and product insights, trends and patterns for future tactical and operational strategies. A key differentiator between Analytics and Market Research is that analytics relies on data which is existing within a database while market research generally involves collection, collation and tabulation of the data. Market research involves mostly dealing with survey level data, as in questionnaires that measure consumer response to marketing stimulus. It includes link analysis for websites, manipulating data to be easy to read by softwares like SPSS, creating cross tabs and statistical analysis including factor analysis and cluster analysis. However, it is wholly centered on questionnaires and deals exclusively with customer level data that answers questions related to marketing. There is no market research in risk, credit, or collections. Thus, market research is limited in the kinds of analytical questions it tries to answer and, thus, the breadth of analysis as well. Business Intelligence is defined as the seamless dissemination of information throughout the organization and is a broader term, which involves and includes analytics as well as reporting systems. It includes softwares like customer relationship management, supply chain management, planning as well as reporting systems. Business intelligence broadly includes analytics within a company but it can also include areas that deal more with flow of information or knowledge management as well. While database analytics assumes data is present, business intelligence focuses more on strategy. The field of data analytics is vast and it comprises the following types. -
Types of Analytics 1) Reporting or Descriptive Analytics
Each organization relies on series of Management Information Systems (commonly called MIS) to gather the current state of business as well as any emerging trend. This typically involves sales, finance, customer and competitor data, which is presented within spread-sheets and presentations. Reports tend to be either regular (like monthly and quarterly) or ad-hoc (for special investigative analysis). This is known as Descriptive Analytics simply because it describes the data which is present. While reporting or descriptive analytics is often the starting point in analytics careers, a proper grounding in this domain is necessary both to build an eye for detail in dealing with large amounts of data and for polishing the presentation skills for presenting insights from the data. 2) Modeling or Predictive Analytics Predictive Analytics refers to the art and science of using statistical tests, hypotheses and methods to build-up predictive recommendations. These recommendations can range from which type of customer to call by phone for a credit card or insurance, to which type of mobile scheme to offer to a cell phone customer by a short message (SMS), or to what kind of customers are likely to default on the loans they have taken. Predictive analytics includes techniques like segmentation and regression modeling. It is generally considered both high value, and a background in statistics helps in preparing for predictive analytics careers. 3) Data-Driven Strategy This is also called Test-Control or Champion-Challenger Testing. This is done by segmenting the data population into test (on which a new strategy called the Challenger Strategy is to be tested) and control (which uses existing strategy called Champion Strategy). Building association rules which describe which parts of the product or customer data are clustered or co-related together are also part of analytics. Basic Domains Within Analytics Data-Driven Analytics, by definition, thrives in industries, which have large amounts of data and high volume transactions, which need systematic and scientific analytics to cut costs and grow sales. The following domains offer employment opportunities to both new-comers and experienced analytics professionals. These can be both in domestic firms, captive outsourcing firms, or third party business process outsourcing companies.
1) Retail Sales Analytics Retail Sales Analytics deals with the handling of vast amounts of Point of Sales data, inventory data, payment data, and promotional data, to help increase sales in retail
stores, especially in organized retail. The use of RFIDs, Electronic Payment and Bar Scanning helps capture the data better and store it in vast databases. An example of this is the famous Thursday baby diaper-beer sales phenomenon. A big retailer found that on Thursday evenings, sales of beer and baby diapers were highly co-related. He then found that is was due to young couples preparing for the week-end by buying supplies of diapers and beer. Thus, by placing diapers and beer closer together sales could be boosted up. This is an example of market basket analytics in which a large amount of data is scrutinized to see which products sell well together. Wal-Mart, the American retail giant, established a competitive edge over its rivals by proactively using data driven analytics to cut costs and, thus, offer goods cheaper than others. Another example of a big retailer is Target, which has it's own captive back-end analytics in India. In India, since Reliance Retail, Future Group, Walmart-Bharti have started setting up shop, this is a sector that is bound to grow even within the domestic sector, as these high volume retailers need data driven decisions to squeeze the maximum from their retail stores. 2) Financial Services Analytics Financial services use analytics extensively. This is because they are in a very competitive field, have millions of customers and a lot of transactions. It is extremely important for them to store data for billing purposes and to recover the money they lend out as well as the deposits they collect. An incremental gain of a few basis points (one hundredth of 1 percentage is a basis point) in profitability can lead to millions of dollars in aggregate profits. Within financial services analytics, the broad sub-categories are: a. Risk & Credit Analytics - Risk and credit functions measure the ability of a customer to pay back loans or debt owed by them. Delinquent customers are those that have fallen behind in paying back debt as per agreed schedule. Debt can be fixed installment like EMIs for a personal loan, and debt can be revolving as in variable amounts that can be paid for credit card outstanding including the minimum balance. Debt can also be secured debt as secured against houses, consumer durables, two-wheelers, automobiles as collateral, or it can be unsecured as in personal loans or credit card debt that have no collateral or backing.
A risk analyst develops scorecards that help measure the risk worthiness of both new and existing customers. As financial service instruments are priced against risk, the
riskier the customer, the more they are charged in terms of interest rate. But this has
to be balanced with total repaying ability of the customer, including sources of income and current leverage. In addition, the income of customers, especially in India, is changing rapidly and there is also un-declared income as black money. Doing the analysis for millions of customers is what makes risk and credit analytics one of the hottest sectors to be in, as credit analysts are in demand with all banks, outsourcing corporate and finance companies. ICICI has a big analytics unit (called Business Intelligence Unit) and Citigroup has both domestic analytics (in Chennai) and international analytics centers (in Bangalore). An example is a bank using repayment behavior to automatically increase credit limit selectively based on types of purchases made and repayment behavior. This offer is then conveniently sent to the customer in the form of an SMS. By increasing credit limits, the bank tries to encourage spending and average receivables. b. Marketing Analytics - Marketing Analytics helps in customer acquisition and retention. It does so by helping choose more responsive customers and selling through a wide variety of channels like call centers, direct mail, SMS through mobiles, and e-mail. It is marketing analytics which helps to bring in new customers by giving inputs to the marketing team and feedback to sales and distribution channels. An example of using analytics is that some banks use ATMs screen to offer home loans, personal loans based on details of savings bank account with that bank. This is enabled because that particular bank has well-established data centers in which each customer touch point is automatically mapped and then modeled to give customers targeted offers. Another example is an international bank using its closed loan customers database and selling nearly 1 lakh credit cards by calling all customers who paid back the loan without default and getting a 10% response rate through datamining and analytical scorecards. c. Collections Analytics - Collections Analytics focuses on recovery from delinquent customers using optimized efforts like telephones, direct mails, e-mails or visits. Its aim is to maximize recovery at minimum costs. d. Fraud Analytics - Fraud Analytics seeks to build in triggers or automated alarms, if there is any unusual trend or behavior in spending by the customer especially in credit cards. . Pricing Analytics - Pricing Analytics tries to give the most optimized price, adequately compensating for risk as well as the competition. Pricing Analytics is a vast field, and is also a part of financial services analytics, especially in
products like insurance. 3) Telecommunications Telecom Analytics has the fields of marketing analytics defined above, but an important part is also attrition modeling or churn analytics. It also analyzes the wide variety of pricing schemes and options and the customer response to them. In addition, it has delinquency analytics as well. 4) Pharmaceutical or Clinical Analytics Clinical trials depend on test and control of thousands of patients on new drugs. Clinical Trial Analytics focuses on large number of variables that may or may not affect the drug response. 5) Supply Chain Analytics Supply Chain Analytics comprises inventory optimization, tracking turn-around time, multiple reports, and how to minimize the distribution costs. 6) Transportation Analytics Transportation Analytics, while covered more extensively in the field of operations research, seeks at minimizing route length or fuel costs, or pricing of fares. 7) Online or Website Analytics Website Analytics focuses on analyzing traffic to the website from sources, and how to retain them on the website for longer time or purchase more goods. It also involves a bit of search engine optimization to make sure the website is relevant in searches by search engines. Success Stories ICICI Bank has been a pioneer in using analytics for cross-selling in financial services in India through ATMs, Internet, Home Loans and Deposits. It has done so by leveraging its investments in data centers through Tera Data, a world leader in data storage and building an ecosystem, which uses flow of information to capture customer level data, and then work with its in-house business intelligence unit (analytics) team to build models to target customers.
Page - 6
Google.com is a pioneer in analyzing the ranking or importance of a website (text mining) and is also a leader in online advertising because of better targeting of ads. It does so by creating a mathematical formula for the importance of a website by
measuring the importance of links linking to the website, location of the links through its proprietary page ranking system. It also searches websites to place relevant ads, thus, helping its advertising business.
Careers in Analytics y Basic Qualifications Required - A Master's Degree in Statistics, Engineering, Mathematics, Economics or in Management is a requirement for careers in analytics. Exposure to programming and quantitative subjects is essential for this domain. Prior knowledge of softwares like SAS, SPSS and VBA is a definite plus. SPSS is taught in many MBA colleges as part of the curriculum. y Job Attributes - Analytics requires strong attention to detail, quantitative acumen, hard work, and ability to think creatively in terms of how to design test and control for strategy building. An ability to pick up programming language fast is a must as the large amounts of data is manipulated using softwares. Rewards & Challenges of an Analytics Career Sweet Pros - The rewards of being in analytics is international opportunities, rapid rises, exposure to the best softwares and top management, and a lucrative compensation options as it is still a niche field with terrific demand. The opportunities in analytics careers are evolving, as domestic demand for analytics is picking up. People with expertise are widely respected and paid handsomely. Due to international demand for analytics being strong, there are opportunities in trips or on site stints as well. Since most analytics decisions affect companies strategically, this career also gives exposure to people to interact and work closely with senior management, thus, getting chances at learning and exposure very well. Sour Cons - Challenges in this domain lie in tieing statistical knowledge with business application and programming acumen in analytics software. The work is detail-oriented and requires careful use of data to prevent costly errors or data
privacy issues. In initial years, the role of an analyst can be quite similar to programming or poring over huge amounts of data. The field of analytics is best suited for people with a very good quantitative aptitude due to the nature of the domain. As a fresher, you can also improve your knowledge of statistics especially in regression, distributions and hypothesis testing to improve your chances of getting selected. Knowledge of the following software can be helpful in initial stages of your career in analytics: y SQL y SAS (www.sas.com) y SPSS (www.spss.com) y Business Objects y Cognos y Crystal Reports y KXEN Career Paths for Analytics Professionals Career progression in analytics follows the broad pattern as follows: y Fresher - As an entry level programmer or analyst, you would be required to write code to generate reports, or clean data to prepare it for analysis. You would also be expected to pick-up nuances of business data, what data is usually wrong, what are the outliers to spot, besides learning the programming language to retrieve and manipulate data. This phase will last for upto two years. As you become more senior, you will also assist in recruiting and training fresher. y Experienced Analyst - For a period of three to five years of total relevant experience, you would then be working as a senior analyst / assistant manager with official duties in data analysis with some people responsibilities. Depending on your aptitude and organization, you can tweak the level of business exposure, people management with amount of technical analysis / skills. y Managerial Roles - After a period of upto five years, you would be full-time into client interfacing, people management, requirements gathering, and translation to technical details for your team. This will also involve recruiting, mentoring junior members and technical training.
y Head (Analytics) / Associate Vice President / Business Leaders - You can expect to be a business leader within eight to ten years of total experience. The focus will be to grow your team size, maximize customer satisfaction, and deliver innovative
analytics that impact business revenue positively. Corporate Recruiters y Genpact y GE Money y ABN AMRO y ICICI Bank y EXL Service y WNS Global Services y Progeon (Infosys BPO) y HCL y American Express y Target y Amazon y Mu-Sigma y HSBC Bank y Deloitte
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue reading from where you left off, or restart the preview.