Module 1: OVERVIEW TO BUSINESS ANALYTICS

What do we mean by Analytics?

Analytics is defined as the extensive use of data, statistical and quantitative analyses, explanatory and predictive
modeling, and fact-based management to drive decision making.
 Analytics is the process and procedures if discovering and interpreting data into a useful information.
 Analytics is all about providing business users with better insights, particularly from operational data
stored in transactional systems.
 Fortunately, data mining, analytic applications, and business intelligence systems are now being better
integrated with transactional systems.

THREE TYPES OF ANALYTICS

 Descriptive Analytics - Descriptive Analytics answers the questions what happened and why it happen?
 Predictive Analytics - Predictive Analytics Answers the the questions what will happen?
 Prescriptive Analytics - Prescriptive Analytics anticipates what will happen, when it happened and also why it
happened?

What kind of questions can Analytics answer?

Business Users and Their Challenges (The following challenges highlight characteristics of this gap).
 The time to perform the overall cycle of collecting, analyzing, and acting on enterprise data must be reduced.
 Clear business goals and metrics must be defined.
 Analytics results must be distributed to a wider audience.
 Data must be integrated from multiple sources.
 Acceptance criteria of the analysis models must be clearly stated.

Trends in Business Analytics

 Verticalization Analytics solutions are becoming increasingly focused on industry specific problem solving.
 Comprehensive Models and Transformations for Insight Rich visualization functionalities that show only a
few and the most important attributes.

Why it’s time to put Analytics to work?

 Most companies today have massive amounts of data at their disposal. We can see this by just accessing the net,
social media and other surveys out there holds a very vast amount of Data. (Ex. Twitter, Youtube, Sensor,
Facebook etc.)

Where Does Analytics Apply?

 Analytics can help to transform just about any part of your business or organization.
 OLTP - Online Transactional Processing (It holds a diff. Trasactions.)
 OLAP - Online Analytical Processing (It can perform or compute high volume of data warehouses or data marts.)
 ETL - Extract, Transform, Load Processes

The Power of Information

 Information has always been power, but the past few decades have seen a subtle shift occur, fundamentally altering
the way we perceive it. It has been only relatively recently that the amount of data available to us has outstripped our
ability to investigate that data.
 Information can help us understand the perspective of other people.

Metrics and Measurements

 Metrics will translate the business challenges into operational measures that can be monitored over time, not
only for analytics impact, but for the entire company.
 Objective means by which your company can measure progress and business analytics impact.
 Increase productivity and market share  Increase average spend per customer
 Increase retention and conversion rate  Decrease operational costs
 Increase wallet share  Decrease time-to-decision
 Increase customer satisfaction  Optimize human capital
 Increase average order size/number of products

Where is Analytics not practical?

 When There’s No Data.  When the Decision Maker Has Considerable
 When There’s No Precedent. Experience.
 When History Is Misleading.  When the Variables Can’t Be Measured.

Overview: The Challenges of Business Analytics

Effective business analytics is a focus for business leaders across the globe in ever-increasing numbers. A 2011
report by the McKinsey Global Institute projects that the United States needs 1.5 million more data-literate managers to
meet the demands of the data-driven enterprise. In addition, during IBM's 2012 IBM Partner World Conference, its CEO
predicted that analytics will be the thread that weaves together front- and back-office systems in order to give companies
that harness huge volumes of unstructured data a competitive business advantage.
 Must be grounded in key business questions.
 The most impact on the organization when it is forward looking—not backward looking.
 New age of business analytics requires the integration and synthesis of various information disciplines across
the organization.

Challenges from Outside Challenges from within

 Environment  Inside the organization
 Competition  Evolving Business Analytics
 Customers  Less Subject Matter Experts
 External Factors
 Internal Factors

The Secret of Success (Possibly the best-guarded secret in business analytics is that in practice, they must.)
 Establish business analytic culture
 Understand analytic in play
 Recognize the insights as a competitive advantage.

Analytics for the Rest of Us

 Many of our practitioners worked in companies that didn’t want to become analytical competitors, but rather
wanted to move their organizations toward greater analytical maturity. They believed that making decisions on
facts and analytics was beneficial, but they didn’t necessarily want to build their companies and value
propositions around doing so.
 In this module we occasionally refer to analytical competitors, such as Cincinnati Zoo , Papa Gino’s , Kraft
Vegemite and other business, because they are great repositories of leading analytical practices.

Module 2 : FUNDAMENTALS OF BUSINESS ANALYTICS

Two fundamental approaches to finding business opportunities.

 Outside - In Thinking: Keeping tabs on what others in your industry are doing. (it focuses on competitors)
* What makes the business tick?
* Where does the next breakthrough await?
 Inside - Out thinking: Keeping a systematic inventory of the key business processes. (it focuses on operation or
business)
* How are key decisions made within?
 * What are the key business decisions?
* How they can be made more process-oriented?

Data Generators
 Youtube  Itunes  Twitter

BIG DATA CHARACTERISTICS

1. Volume – mass quantities of data this is the organizations trying to harness to improve decision making across the
enterprise. (Data Size)
2. Variety – different types of data (structured, semi-structured, unstructured) and data sources (text, web data, tweets,
sensor data, audio, video, etc) ( Different forms of data sources)
3. Velocity – continuing acceleration of the speed at which data is created, processed, and analyzed. Contributing to
higher velocity is the real- time nature of data creation, as well as the need to incorporate streaming data into business
processes and decision making. ( Speed of Change)
4. Veracity – level of uncertainty and reliability associated with the types and sources of data (e.g., the utility of
www.snopes.com to verify viral posts on the internet) (Uncertainty and Reliability of data or the Truthfulness and
Accuracy of data)

THE BUSINESS CASE

 Smarter decisions – Leverage new sources of data to improve the quality of decision making.
 Faster decisions – Enable more real-time data capture and analysis to support decision making at the “point of
impact,” such as when a customer is navigating your website or on the telephone with a customer service
representatives
 Decisions that make a difference – Focus on efforts toward areas that provide true differentiation.

TRENDS
 New Technologies: Expect “New technologies such as in memory computing, no-sql databases, hadoop,
interactive visualization, and natural language processing; as well a range of advanced analytics including
predictive analytics, machine learning and prescriptive analytics.” Gartner.
 Data Visualization: The market for visualization products will continue to grow as decision makers demand
dashboards with easy to read graphs. Vendors must design easy to use self-service solutions for end users.
 Rich Media: Increased demand for tools that can analyze video, audio and images and combine that analysis
with social analytics and other more traditional business analytics.

CRITICAL SUCCESS FACTOR

 “The most important ingredient to a game-changing Analytics program is not technology, it’s smart people. As
intelligent as the software is, as fast as the hardware responds, without proper leadership, analytics doesn’t
compute. Being successful with analytics is about having the right mindset, the right organizational model, and
the right strategy.” Gartner
 "Whether an organization calls the role "data scientist" or something else, individuals (or teams of professionals)
with these core skills and soft skills will prove essential in maximizing the realized value of information assets,
and discovering opportunities for enhanced business performance and competitive advantage.” Gartner

(Two types of Skills: Technical skills and Non-Technical Skills )

TECHNICAL SKILLS
 Education –a very strong educational background is usually required to develop the depth of knowledge
necessary to be a data scientist. Their most common fields of study are Mathematics and Statistics (32%),
followed by Computer Science (19%) and Engineering (16%).
 Analytical Tools – SAS, SPSS, R. In-depth knowledge of at least one of these analytical tools.
 Computer Science – coding, SQL, working with unstructured data.

NON-TECHNICAL SKILLS
 Intellectual curiosity – Given a mountain of data, what inferences can we make? What truth is revealed or
predicted? The strongest data scientists are motivated by this curiosity to explore data in very creative ways --
people who are not only good at answering questions, but who want to ask their own questions. (you are curious
about the things you want to know)
 Business acumen – A data scientist must have a solid understanding of the industry he is working in, and know
what business problems the company is trying to solve. In terms of data science, being able to discern which
problems are important to solve for the business is critical, in addition to identifying new ways the business
should be leveraging its data. (you have a solid understanding on what cannot work to your business)
 Communication skills – A data scientist can clearly and fluently translate technical findings to a non-technical
team, such as the Marketing or Sales departments. A data scientist must enable the business to make decisions
by arming them with quantified insights, in addition to understanding the needs of their non-technical colleagues
in order to wrangle the data appropriately. (you should know how to communicate)

Three Different Size of Data Data Sources

 Structured  Audio
 Semi-Structured  Video
 Unstructured  Web
 Data
 Tweet
 Sensor
2.3 Using visualization to understand big data
Your data is only as good as your ability to understand and communicate it, which is why choosing the right visualization
is essential.

Why data matters?

In the era of data driven metrics used to define success by analyzing statistics and trends, the need for data is as
present in the gender equality conversation as in any other. It has become increasingly important, if not entirely essential,
to have accurate reliable data to help guide us in developing the strongest solutions (Forbes, 2014)
Today, data moves and grows at the speed of machines, producing the phenomenon known a s big data. This data
is often characterized by the three Vs: volume, velocity, and variety. Big data pr esents new opportunities and challenges
for busin ess. Fortunately, the economics of data have chan ged, giving rise to new models to manage and pro cess data,
allowing companies to pursue new stra tegies to enhance their existing data models and processes (IBM, 2013).
Too much data, not enough information!

Structured Data
Clean No redundant data Free from anomalies

FINDING THE STORY IN YOUR DATA

Information can be visualized in a number of ways, each of which can provide a specific insight. When you start
to work with your data, it’s importa nt to:
 identify and understand the story you are trying to tell; and the relationship you are looking to show.
Knowing this information will help you select the proper visualization to best deliver your message.
When analyzing data, search for patterns or interesting insights that can be a good starting place for finding your story,
such as:

What is Visualization?
 The use of images to represent information
 It provides a powerful means both to make sense of data and to then communicate what we ’ve discovered to
others.
Many of the current trends in data visualization are actually producing the opposite of the intended effect, confusion
rather than understanding. To solve this problem, we must understand data and use it properly.
The solution: RICH VISUALIZATION

Purpose
 Tell the story / communicate the message
 Assist the reader in thinking / reasoning about the topic
 Enable rapid comprehension / interpretation
 Support decision-making
 Inform / provide insight
 Establish credibility

Why visualization is different from reporting?

Visualization is not a replacement for re porting, whether those
reports are delivered in dashboards, scorecards, or more detailed
write-ups describing business issues. Rather, visualizations are
powerful supplements that can be incorporated in reports and
presentations that better communicate complex ideas, relationships,
and trends than data tables or more traditional graphics.

Using visualization of a big data for complete picture.

Goals of Data Visualization
In a business environment, visualizations can have two broad goals, which sometimes overlap.
Explanatory - Explain Data to Solve Specific Problems
Visuals that are meant to direct the viewer along a defined path are explanatory in nature. The bulk of business
dashboards that we come across in day-to-day scenarios fall in this category.
Explore Large Data Sets for Better Understanding

Exploratory visuals offer the viewer many dimensions to a data

set, or compares multiple data sets with each other. They invite
the viewer to explore the visual, ask questions along the way, and
find answers to those questions.

Exploratory analysis can be cyclical without a specific end point. Viewers can find many insights from a single
visualization, and interact with it to gain un derstanding rather than make a specific decision. This type of
visualization can accomplish the following tasks:

 Pose new questions

 Explore and discover

KNOW YOUR DATA:

DISCRETE
DATA TYPES Numerical date that has a finite
QUANTITATIVE number of possible values. For
Data that can be measured or example: number of employees
counted; all values are numerical. in the office.

CONTINUOUS CATEGORICAL
Data that is measured and has a Data that can be sorted according
value within a range. Example: to group or category. Ex: Types
raindall in ayear of product sold