The importance of data to the business world can’t be understated. Businesses collect different types of data from multiple sources every day and ultimately, leverage tons of raw data for actionable insights. The act of solving business problems with these insights is known as business analytics (BA).
Business analytics encompasses the skills, methodologies, and technologies for continuously exploring historical data to inform future events. Many businesses rely on business analytics to improve business value across multiple business functions, including human resource management, customer service, marketing, etc. Here are a few reasons why business analytics is useful.
It helps you make data-driven business decisions.
Many business organizations adopt BA strategies to influence decision-making. Previously, business leaders relied on their experiences and guesswork but these approaches may not always lead to the best decision. In contrast, business analytics affords an accurate understanding of past and present scenarios improving their potential to predict and make the best decisions.
Analytics for business comes in three main categories, including prescriptive, descriptive, and prescriptive data. Descriptive analytics can use a business’s current and historical data to identify trends and relationships. Company reports tracking inventory, workflow, sales, and revenue charts are typical descriptive analytics examples. These analytics types help businesses answer the question “what has already happened?”
Predictive analytics informs businesses of what could happen in the future and helps businesses understand unforeseen events based on a business’s past performance. Businesses can then create best-case scenarios of future trends using predictive models. Prescriptive analytics considers several factors, including predictive and descriptive analytics results, to make concrete recommendations for a business’s future. Businesses can significantly improve their decision-making efforts armed with these three phases of businesses analytics.
It helps personalize customer experiences.
Personalization has become increasingly essential in today’s digital world and customers have several options to satisfy their needs and are often spoilt for choice. What’s more, they want brands to anticipate their needs and point them to the best option.
Business analytics can afford companies of all sizes an innovative way of personalizing sales recommendations and online experiences using past purchasing habits.
For example, many travel nurses face several challenges, like finding a convenient location to practice their healthcare career choices. A platform like Fusion Marketplace, the first-ever traveler-driven job marketplace, might use business analytics to predict the lifestyle choices of their patrons. The platform aims to provide a one-stop shop for travelers to access healthcare jobs across multiple agencies. Understanding the lifestyle goals of each healthcare traveler using business analytics will help this traveler-first community effectively manage the next steps of customers. All in all, personalization has a huge potential of controlling a customer’s overall experience on your platform using machine learning algorithms and other advanced analytics solutions.
It helps improve efficiency and streamline operations.
Many businesses begin their production and operational years with key performance indicators (KPIs) to ensure employees put their investments into good use. The best way to guarantee operational efficiency is to periodically measure these key metrics and make necessary tweaks.
Modern businesses now use data visualization tools that make it easier to track business operations. Data visualization can be a powerful tool in gathering massive amounts of data from different data sources. Data visualization deploys business analytics to generate insights across unrelated data sources and formats, improving the quality of data your business leverages for its operational decisions.
It helps mitigate risks.
Industry leaders also face several types of risks during operations. These risks include employee theft, and seasonal changes (and their effects on your supply chain). However, effective business organizations keep a controlled risk level to remain efficient and enjoy a significant competitive edge in their markets. Business analytics can help companies mitigate risks and handle setbacks.
All in all, business organizations worldwide are deploying business analytics strategies. The current BA market is increasing at a 13 percent growth rate. If you’re yet to invest in business analytics, you’re not too late.