Business Analytics

● Study that concerns itself with the scientific interpretation of the data using a range of pre-existing
fields of study such as Mathematics, Statistics, and Information Technology.
● Convert business data into accurate business insights.
● the collection of business data from various sources, processing them and using various
methodologies to extract the desired insightful data from these datasets.
● The process by which businesses use statistical methods and technologies for analyzing historical
data in order to gain new insight and improve strategic decision-making.
● Data management solution and business intelligence subset, refers to the use of methodologies
such as data mining, predictive analytics, and statistical analysis in order to analyze and transform
data into useful information, identify and anticipate trends and outcomes, and ultimately make
smarter, data-driven business decisions.

Earlier, was a very disorganized field where a number of simple tools, basic arithmetic, and mainly human
intelligence, experience, and intuition were put to use to gain some insights from the limited amount of
data that was generated from the business organizations. Though midsize and small businesses are slowly
waking up to the advantages of business analytics, large companies are already employing the services of
business analytics experts and are buying or are investing in the development of business analytics
software based on which they can make decisions.

The two biggest achievements of the 21st century have been the immense progress made in the
computational capabilities and the internet of things that have allowed a huge amount of data to be
generated at every second that covers all aspects of a Business. Modern analytics tools and software are
so advanced that they can execute every step from data collection to preparation of reports. These reports
are then used to look at forecasts for the future, create business strategies based on sound data and
management of risks and capital losses. Statistics is one of the most accurate sciences in the world, and
business analytics is a modern, technological form of statistics.

Business Analytics vs Data Analytics

Data analytics is a broad umbrella term that refers to the science of analyzing raw data in order to
transform that data into useful information from which trends and metrics can be revealed. While both
business analytics and data analytics aim to improve operational efficiency, business analytics is
specifically oriented to business uses and data analytics has a broader focus -- both business intelligence
and reporting and online analytical processing (OLAP) fall under the data analytics umbrella.

Data scientists, data analysts, and data engineers work together in the data analytics process to collect,
integrate, and prepare data for the development, testing, and revision of analytical models, ensuring
accurate results. Data analytics for business purposes is characterized by its focus on specific, business
operations questions
Business Analytics vs Data Science
Data science is a multidisciplinary field that uses scientific systems, methods, and algorithms to study
structured and unstructured data in order to determine where information comes from, what it means,
and how it can be transformed into a valuable resource in the development of information technology
strategies.

Data science combines data analysis, statistics, machine learning, and related methodology in order to
manage and understand the data deluge associated with the emergence of information technology. Data
scientists are tasked with presenting digital information in a way that depicts its practical value in data-
driven decision-making; however, they don’t typically endeavor to solve specific questions in the way that
business analysts do when seeking out business analytics insights.

Business Intelligence vs Business Analytics

Business intelligence analytics focuses on descriptive analytics, combining data gathering, data storage,
and knowledge management with data analysis to evaluate past data and providing new perspectives into
currently known information.

Note: Essentially, business intelligence answers the questions, “What happened?” and “What needs to
change?”

Business analytics focuses on prescriptive analytics, using data mining, modeling, and machine learning
to determine the likelihood of future outcomes.

Note: Answers the questions, “Why is this happening?”, “What if this trend continues?”, “What will
happen next?”, and “What will happen if we change something?”
Components of Business Analytics
1. Roadmap and operating model
Each company uses planning tools to create sustainable designs for its processes and capabilities.
This allows companies to handle their data efficiently and to provide services to their clients.

Road maps and operating models are managed by managers to keep track of the activities and
procedures of the staff, verify the consistency of the main performance metrics, devise strategies to meet
the mission and vision of their company.

2. Data Aggregation
The process of having a centralized location for the data, extracting and loading the relevant data
by putting relevant filters, and creating subsets of data is the core aspect of Data Aggregation.

This is where the data is transformed depending upon the business requirement.

Data is collected to one single, central location from where sorting can begin. Inaccurate and
incomplete data is removed and only usable data is left behind. Even duplicate data is checked for and
removed completely. This data is collected from various sources.

Also, data pertaining from various sources are combined to have one large dataset. The format of
the data is also sometimes changed at this step to make it compatible with the tool being used to achieve
the objectives.

3. Data Mining / Data Cleaning / Text mining / Association & Sequence

Identification
Data Mining is the next step to look for unknown patterns and trends. For this, one has to mine
through a huge amount of data by creating mining models. Various statistics models are used. One of
those models is classification demographics and other such parameters are used for sorting data.

Data Cleaning is an extremely important component of business analytics because the data in its
raw form sometimes is not directly usable. As the other components of Business Analytics use
mathematics, statistics, and computer programming, the data must be compatible with these streams of
study.

What consumer types or comments in blogs and other social media comments or their interaction
with customer service call centers are a part of the text mining component. This data is crucial in improving
customer service. Customer service is one of the big reasons why people show loyalty toward a brand or
product.

Text mining also helps in the development of new products based on the data collected. They also
help monitor competition and the developments they are making.
 These components are a pattern of consumer behavior. In the association part of the behavior,
consumers buy products that are associated with each other like toothpaste and toothbrush or shampoo
and conditioner. In the sequence identification, the sequence on buying is extracted like a sequence of an
airline ticket, airport cab ride, and hotel room.

This form of analytics components makes it easier to understand what the consumer is going to
buy next and understand their buying patterns and behavior.

4. Data security
Monitoring and identification of malicious activities within corporate networks are very critical
because of the growing threats to global security. Big Data Security Analytics is a series of next-generation
security tools that use different correlation algorithms to identify components that can produce many
security warnings, rapid detection and cyberattack reduction. Security analytics collect data via network
traffic, cloud resources, business applications and data about user behavior. They analyze real-time data
to predict suspicious activities by providing the latest vulnerabilities.

5. Data governance and standards

Data governance and standards are required to meet the growing regulatory requirements of an
enterprise and attain data of high quality. Implementation of data governance and standards is focused
on enhancing data management efficiency, developing robust data systems for international real-estate
holdings, formulating data stewardship and ownership, performing international audits and compliance
assessments becoming more rigorous

6. Insights and Interpretation / Forecasting

The values gained from the analytics implementation are called insights. They help you identify
opportunities for enhancing your business and addressing market fluctuations. Analytics lets the data
achieve values by finding new patterns and trends.

A famous saying goes that history repeats itself, and this saying is quite true when it comes to the
forecasting components. It has been observed that consumers resort to a certain behavior specific
seasons or a period. This repetitive behavior can be observed and planned for by forecasting.

Buying warm weather clothes a few weeks or days before the cold season, buying sporting merchandise
before the sports season, or the increased search for a specific keyword based on the current events –
these are all examples of forecasting
7. Evaluation and Validation
Once the results come out, the next task is to understand if the result stands true given a different
situation or not. This is where is predictive models are used and their evaluation and validation are
conducted whereas, for other methods, various simulation techniques are put to use to identify the most
plausible outcome, thus providing a very reliable result. Here also, the business analyst needs to learn a
range of techniques to identify the shortcoming in their method, work on it, improve it, and make their
insights stable and valuable

8. Reporting and Data Visualization

Perhaps the most important and often overlooked component of the discipline is the aspect of
communicating the results in an easy-to-understand way. This requires innovation and creativity and is
the reason that this field is open to all and not only to mathematicians, statisticians, or computer
programmers. To quickly make people understand the complex insights discovered over weeks or even
months, reports or presentations are created that have simple tables, bullet points, etc

Visualization of data refers to the graphical representation of the information obtained through the
analysis. It helps to present data effectively and in an entertaining way, while making the output accessible
and simple to understand. Its components include panels, tables, graphs, infographics, dashboards.

9. Data optimization
Data optimization techniques work to reduce the response time of the database system to improve the
speed and reliability at which the data is retrieved. Data managers and analysts use optimization strategies
to develop methods of accessing data from a file.

Business analytics really help with the optimization component. Businesses can really make great use of
analytics and optimize their operations. They can anticipate surges in demand and step production to
maintain supply. They can competitively price their products when there is supposed to be a peak or
shortage. Businesses can also create sales, offers, and discounts based on business analytics.
The Business Analysis Core Concept Model
It can be used for describing and defining the work of business analysis as it correlates and
further explains the definition of what business analysis is.

It can help us understand the relationship between these concepts when conducting different
tasks of business analysis.

It might be used to evaluate that all relevant results are considered when working with a specific
knowledge area or assess the quality and completeness of the deliverables.

Business Analysis
Practice of enabling change in an enterprise by defining needs and recommending solutions that
deliver value to stakeholders.

The core concepts are described below:

• Change: The act of transformation in response to a need.

The main output of business analysis work, aims at making improvements to one or
several aspects of an enterprise.

• Need: A problem or opportunity to be addressed.

• Solution: A specific way of satisfying one or more needs in a context.
It causes a change that satisfies a need and makes an impact on stakeholders who have
some form of interest in the matter.
It brings some kind of tangible and/or intangible value that can either be measured
directly and/or indirectly.
• Stakeholder: A group or individual with a relationship to the change, the need, or the solution.
• Value: The worth, importance, or usefulness of something to a stakeholder within a context.
• Context: The circumstances that influence, are influenced by, and provide an understanding of the
change.
They are factors might be industry trends, regulations, organizational attitudes and
culture, or enterprise-specific factors (financial, product, process, and/or technology).

Business Analysis Core Concept Model

Business Analysis Body of Knowledge
 In 2003, the International Institute of Business Analysis (IIBA) was formed as an independent
non-profit association for business analysts. It has, since then, steadily grown to encompass more than
29,000 members (2018). Today, the IIBA is the leading association for all who work, at different levels and
capacities, as business analysts. One of the main contributions of the IIBA is BABOK (Business Analysis
Book of Knowledge). BABOK is now the recognized standard of business analysis practice, encompassing
all areas of knowledge including tools, skills, competencies and aspects for good business analysis. As
BABOK is the standard, can be used as an introduction to business analysis.

The BABOK Guide defines the business analysis profession, captures, describes and lists
knowledge areas, associated tasks, skills and a repository of tools and techniques necessary to
effectively perform business analysis. It also functions as “a guide to the business analysis body
of knowledge” for business analysts, and is an important resource for anyone who works in
business analysis.

The BABOK Guide organizes the business analysis tasks into the following six knowledge areas:

• Business Analysis Planning and Monitoring:

This knowledge area gathers all activities that are performed for the purpose of organizing and
coordinating the work that is to be done.

• Elicitation and Collaboration:

This knowledge area collects all tasks related to planning, preparing, and performing elicitation
activities and to confirming the results.

Five (5) main tasks to be done in the Elicitation and Collaboration knowledge area, they are:
1. Prepare for Elicitation: involves understand the scope of elicitation, select elicitation
techniques, set up logistics for each elicitation activity, identify supporting material to conduct
elicitation activity and prepare stakeholders to elicitation work.
2. Conduct Elicitation: involves guiding the elicitation activities and capture elicitation
outcomes.
3. Confirm Elicitation Results: involves compare elicitation results against source information
and compare elicitation results against other elicitation results.
4. Communicate Business Analysis Information: involves determine the objectives and format
of communication and communicate Business Analysis package.
5. Manage Stakeholder Collaboration: involves gain agreement on commitments, monitor
stakeholder engagement and collaboration.

• Requirement Life Cycle Management:

This knowledge area describes tasks related to requirement management from their inception to
completion.

• Strategy Analysis:
 This knowledge area encompasses all tasks required for understanding, identifying and analyzing
the business needs including what is required to address those needs.

• Requirement Analysis and Design Definition:

This knowledge area covers the tasks to structure and organize elicited requirements, and design
the recommended solution.

• Solution Evaluation:

This knowledge area lists of the tasks to be performed for the purpose of evaluating and improving
the value delivered by a solution.

I. BABOK Guide lists and explains the underlying competencies reflecting;

1. The skills,
2. The knowledge,
3. The qualities required to perform business analysis work (those defined in the knowledge
areas).
Each competency is elaborated by describing its purpose, definition and how to determine if a person
masters the competency.

II. BABOK Guide list of techniques - describing different ways the tasks of the knowledge areas can
be performed.

1. technique,
2. purpose,
3. description,
4. elements and;
5. usage considerations.

III. BABOK Guide describes five major perspectives;

1. Agile (when projects are within an agile environment),

2. Business Intelligence (work in the context of transforming, integrating, and enhancing data)
3. Information Technology (work in the context of information system),
4. Business Architecture (work in the context of higher levels involving architecture of a
business), and
5. Business Process Management (within the context of business process development and/or
improvements).