The Importance of Business Analytics
Just How Important are Business Analytics?
Business analytics is a valuable data management solution and business intelligence subcomponent. A significant objective of business analytics is to translate big data into actionable information. Actionable information is utilized to identify potential outcomes and trends. Data business analytics supplies support data driven decision making capabilities which benefits business decisions and competitive edge presence. Companies are increasingly realizing the value of considering analytics important to overall business performance. In fact, many high performing companies use business analytics already.
Many challenges business professionals face are remedied by proper business analytics. Staff members ranging from decision making human resources business leaders to supply chain employees benefit from the analytics business analytics supplies. Analytics help with many common challenges business professionals face. Challenges business professionals experience range from project management problems to social media engagement issues. All in all, analytics help businesses maintain a competitive edge and boost bottom line profits. Significant advantages business analytics offer businesses include-
1. Bottom Line Profitability
Many companies use business analytics to improve their bottom line profitability. Studies show that when businesses invest in big data they yield a 6% average increase in profits. For investments in big data that span over 5 years, that average increases to 9%. Another study found that businesses that analyze data able to quantify gains report an average revenue increase of 8%. Even further, these businesses reported a 10% reduction in costs. As such, many business leaders consider data analytics important for business success.
When companies use analytical techniques they are 200% more likely to be in the top financial performance quartile. The analytics business leaders access help to identify business opportunities that would likely have otherwise been overlooked. Not only do analytics help identify opportunities but also can recommend suggested actions. Business analytics support companies asking the right business questions and correctly utilizing specialized skillsets.
Business analytics used can influence a wide range of business operations, from human resources to supply chain procedures. Companies financially benefit from optimizing business administration and human resources efforts through business analytics. While some benefits business analytics offer has near real time implications other are more long term. By securing a competitive edge through business analytics, businesses can achieve a higher market share presence. Tools like predictive models and predictive analytics can help business professionals plan even more successful future products and services.
Fact-: When companies use business analytics correctly they can expect significant financial returns.
2. Risk Management
One reason that business analytics is becoming increasingly popular is its risk management abilities. For everyone from human resources decision makers to supply chain line managers risk management is always a top priority. When companies use available data correctly both short term and long term risks can be avoided. Analytics business intelligence supply including predictive models and artificial intelligence tools that can even predict potential risks. As a result, business leaders can take proactive steps to avoid risks altogether. When business intelligence is optimized, risk management is also optimized.
Business analytics not only assists business leaders in making data driven choices but also benefits specific departments. For example, marketing professionals consider analytics important to understanding shifting trends and customer preferences. The analytics business analysts' supply avoids ineffective and costly marketing campaign failures. Instead, marketing departments can use data to gain a competitive edge and avert unnecessary risks.
3. Decision Making
For smaller everyday hurdles or large challenges business professionals must address companies use business analytics for optimized decision making capabilities. It is crucial to consider that many if not all important business decisions are fiscally related. Best practices include using both real time available data and historical data. Business decisions that are data driven are much more likely to lead to intended results. For example, rideshare companies use machine learning and prescriptive analytics for business decisions made. As a result, companies save millions of dollars in revenue and gain a competitive edge over other rideshare businesses.
Business analytics offers a competitive edge through outstanding decision making and performance improvements. When decision makers use data correctly the business gains a better understanding of everything from customer sentiment to brand reputation. When business leaders and companies use data properly they are much more likely to gain a competitive advantage. With meaningful insight on products and services offered a competitive edge is much easier to maintain. Studies show that companies using analytical techniques are a shocking 500% more likely to make decisions faster!
Data driven decision making also assists internal business operations. For instance, a human resource professional can use data for internal human resources management processes. Alternatively, a supply chain manager could use data for their specific operations. It is crucial that companies use business analytics to benefit not just business leaders but instead all employees.
Note-: Best practices regarding business decisions include data driven decision making capabilities.
Key Takeaways for Business Analytics
- Business analytics is a business intelligence subcomponent and a data management solution that offers companies significant benefits.
- 3 noteworthy benefits that business analytics offer includes enhanced decision making capabilities, risk management solutions, and increased bottom line profitability.