MODULE 1: Introduction to Data Management

Topic 1- Definition and Importance of Business Analytics

As an introduction, this topic will discuss the definition of the concepts such as business analytics, business intelligence,
data science and big data. The importance of business analytics in business decision-making is also emphasized.

Learning Outcomes: At the end of this topic, you are expected to

1. explain the concepts of business intelligence and business analytics.

2. discuss the use and importance of business analytics in the firm’s decision making.

Definition and Importance of Business Analytics

 Big data. Data Science. Data Analytics. Business Analytics. Business Intelligence.
We now live in a world where data have been overwhelmingly available, thanks to the advances in data collection
technology. However, such enormous amount of data—called big data—though highly beneficial requires
thorough analysis for the business entity to make the most out of them.
 And this is where data analytics comes into the picture. We have to note, however, that data science is much
broader than data analytics as the former involves finding ways of acquiring the data available through
mathematical/statistical models and algorithms. Data analytics determines which data are needed and interprets
and presents them (Morganelli, 2020).

Business Analytics or plainly analytics is defined as “the use of data, information technology,  statistical analysis,
quantitative methods, and mathematical or computer-based models to  help managers gain improved insight about
their business operations and make better, fact-based decisions.” (Evans, 2017)

The definition above gives us a glimpse of the importance of analytics in the improvement of business performance
through better informed decision-making and the use of information technology.  The mention of statistical analysis,
quantitative methods and mathematical are admittedly intimidating but as in all things, we can all learn these! We just
need to be patient and diligent as studying these is definitely no easy task.

But before we go to the details of these technicalities of analytics, we need to know first why it is important. In what
aspects of business operations do we see the use of analytics?

Business problems such as increasing sales and revenues, minimizing operations and production costs, hiring personnel,
location choices, product variety to offer, etc. all require that the company has all the most updated and comprehensive
data that it needs before it decides on its options. Sometimes, the needed data are incomplete, outdated or if updated,
enormous in volume and unorganized. This is where the job of the data analyst is most useful. He/she is tasked to present
analysis of data in a concise yet informative and comprehensive manner, aiding in the decision making of stakeholders.
In 1958, Hans Peter Luhn, a researcher of IBM, coined the term “business intelligence (BI)” referring to the “collection,
management, analysis and reporting of data” (Evans, 2017). The video below will further explain this concept. 

BIG DATA : term for the collection of data sets so large and complex that it becomes difficult to process using on-hand
database system tools or traditional data processing applications.

How to consider that is big data, and hard to process data: (5V’s)

1. Volume: 44 trillion gigabytes

2. Variety: different data is being generated from various sources

3. Velocity: data is being generated at an alarming rate

4. Value: mechanisms to bring the correct meaning out of data

5. Veracity:

Big Data as on Opportunity: