As technology continues to transform and resonate as a necessary staple in our daily lives, more industries joining the digital world. Business, in particular, benefits from a strong relationship with technology, as both fields need experts who have both business and technical skills. Business analytics encourages data-driven decision-making, which brings value to any company and makes it easier to achieve the bottom line.
In this article, we’ll take a deep dive into business analytics and some of its challenges, opportunities, and tools.
What is business analytics?
Business analytics is defined as an exploration of an organization’s data with a focused lens on statistical analysis, according to Tech Target. Its purpose is to help companies make better-informed, data-driven decisions. To achieve a successful business analytics strategy, it’s necessary for skilled analysts — who understand a particular company and its goals — to gather high-quality data. Analytics is typically segmented into the following types:
Descriptive analytics: Tracking and analyzing key performance indicators to understand the current state of the business
Predictive analytics: Assessing data trends to predict the future and potential outcomes
Prescriptive analytics: Using past performance data to assess the likelihood of similar situations in the future and make informed decisions based on this information
Once the initial goal is determined, an analysis strategy is put in place to examine data through predictive modeling. This scores data records, which then converts to information that supports strong decision-making via real-time responses.
What are business analytics tools?
According to Microsoft, business intelligence tools are defined as the specific software designed to collect and process large amounts of information, such as books, journals, health records, images, email, video, and other business files. Going a step further than assessing and reporting, business analytics tools are designed to explain the significance of this data, identify weaknesses and potential problems, and forecast future results to make informed decisions. Some examples of business analytics tools include spreadsheets with complex automated statistical functions, sophisticated data mining tools, and predictive modeling.
When businesses have access to these solutions, they remain competitive, increase customer satisfaction, and leverage the ability to achieve top business goals.
What are some of the challenges and opportunities in business analytics?
Today, businesses need to take fact-based decision-making more serious than ever before. Analytics allows companies to grow and follow best global business practices with ease. With every mechanism comes challenges alongside opportunities, however.
On the positive side, researchers Dursun Delen and Sudha Ram discuss the availability of data, affordability of software, and the cultural change toward evidence-based management as major key advantages of business analytics in “Research challenges and opportunities in business analytics” published in the Journal of Business Analytics. In general, there’s a shift toward evidence-based decision-making, and the availability of data and technology infrastructure makes it easier for businesses to follow the trend.
But while these advantages certainly resonate, various challenges are keeping businesses from using business analytics. Some common bottlenecks include:
The talent: There’s a somewhat limited number of scientists who can convert data into truly actionable insights. This increases the need for business analytics experts and encourages students intrigued by the industry to take the plunge.
The culture: The idea of changing from a traditional management style to a more modern data model is intimidating. Adopting analytics means stepping away from something that was once mastered, and this can be a major roadblock keeping businesses from the switch.
The ROI: Analytics is complex and costly. When the return on investment isn’t clear from the beginning, it’s difficult for professionals to assess the value at first.
The security: Data is sensitive information, and even with strong data security, businesses are still concerned with breaches and the distribution of private data.
The data and technology itself: Big data is intimidating to handle, and businesses need to have a strategy for maintaining such a large influx of information. Adopting technology is another common challenge for those who are used to traditional methods.
Since technology is paving the path for the future of most industries, these common challenges must be overcome to encourage more business professionals to get behind the idea of business analytics.
Prepare for a career in BA with the MS in MIS program from the University of Alabama at Birmingham
If you want to build your expertise in the world of business analytics, now is a great time to grow your knowledge and further your education. The online Master of Science in Management Information Systems program at the University of Alabama at Birmingham draws from the world of technology and business so you can improve your communication, business, and leadership skills. The MIS degree is designed to prepare professionals for a career in IT governance, business intelligence, data security, and more.
The MIS curriculum is intended for students intrigued by gathering and analyzing business data, with courses such as Information Systems, Systems Analysis, Desktop Analytics with IT Tools, Information Security Management, and more.
Are you ready to enhance your career in business analytics? Download a free brochure or speak to an enrollment advisor about the online Master of Science in Management Information Systems program today.