Garcia, Jeremiah R.

Business Analytics

Reading Response 1
Descriptive, predictive, prescriptive: Transforming asset and facilities management with analytics

Successful businesses depend on the business analytics, commonly referred to as BA. Business
analytics is the practice of exploring an organization’s data and implementing statistical analysis to drive
decision making. For business analytics to make an impact on the organization, it requires quality data,
skilled data analysts and a commitment to using data-derived insights to inform business decisions.
There are different business analytic methodologies, including: descriptive analysis, which tracks key
performance indicators to understand the present state of a business; predictive analysis, which
analyzes trends to anticipate future outcomes; and prescriptive analysis, which uses past performances
to inform hot to handle similar future situations. With an established business goal, stakeholders can
select an appropriate methodology. Analysis tool can range from a simple spreadsheet to complex data
mining and predictive modeling applications.
Descriptive analytics often characterized by the use of key performance indicators, descriptive
analytics drills down into data to uncover details such as the frequency of events, the cost of operations
and the root cause of failures. The most common type of analytics used by organizations, it typically
displays information within a report or dashboard view.
Predictive analytics asked “What could happen?”, predictive analytics provides answers that
move beyond using historical data as the principal basis for decisions. Instead, it helps managers
anticipate likely scenarios—so they can plan ahead, rather than reacting to what has already happened.
Prescriptive analytics asked “What should we do?”, prescriptive analytics explores a set of
possible actions and suggests actions based on descriptive and predictive analyses of complex data.
Though the final decision is up to the facilities and asset manager, prescriptive analytics solutions can
provide a reliable path to an optimal solution for business needs or resolution of operational problems.
It is important, therefore, for the organization to match its infrastructure, technologies and
processes—its level of analytics maturity—to the stage of analytics it is able to perform and the goals it
wishes to accomplish. The organization should begin with solutions that work with existing data to gain
immediate insights while it puts into place the technologies and processes to support more complex
analytics.
In manufacturing, Business Analytics can help in supply chain management, inventory
management, measure performance of targets, risk mitigation plans, improve efficiency in the basis of
product data, etc. HR professionals can make use of data to find information about educational
background of high performing candidates, employee attrition rate, number of years of service of
employees, age, gender, etc. This information can play a pivotal role in the selection procedure of a
candidate. HR professionals can make use of data to find information about educational background of
high performing candidates, employee attrition rate, number of years of service of employees, age,
gender, etc. This information can play a pivotal role in the selection procedure of a candidate.