Business Analytics Concepts and Frameworks
Business Analytics Concepts and Frameworks
MODULE 1: INTRODUCTION TO BUSINESS ANALYTICS
Introduction
Everyone who runs a business would tell you that making decision is the most important role
they do. Business managers are always faced with questions on what to sell, how much to
sell to whom through what mode. A manager or entrepreneur has to know how much would
it need to make his or her product, how to cut down on expenses, how to market the product
to customers, and when can you expand his or her business. Decisions do not just come
about on their own. They are a product of analysis based on the information available to the
decision maker.
Business managers have always gathered information to base their decisions on. But with
the development of computers that can store and process large amounts of data, business
analytics began to offer more possibilities for decision makers. In this module, we would
learn more about the role of business analytics, big data, and business intelligence.
Learning Objectives
After completing this course, you should be able to:
1. discuss the basic concepts on business intelligence, big data and business analytics;
2. trace the evolution of business analytics; and
3. give examples of big data service providers.
1.1. Business Analytics and Business Intelligence
In the era of knowledge economy, getting the right information to decision makers at the right
time is critical to their business success, and one such attempt includes the growing use of
business analytics (Min, 2017). Business analytics is one of the most talked-about topics in
the field of business and information technology. And as expected, business analytics is
becoming one of the most sought-after courses in the academe.
Business Analytics (BA)
What goes to your mind when you hear the word Business Analytics? Below are some of the
definitions of business analytics.
Business Analytics Concepts and Frameworks
1. Business Analytics is the art of assembling the data gathered through Business
Intelligence in such a way that it can be analyzed by people. It is comprised of the
tools with which people can disseminate the data that’s been collected, to produce
meaningful conclusions (Fulton, 2013).
2. Business Analytics is the use of data, information technology, statistical analysis,
quantitative methods, and mathematical or computer-based models to help
managers gain improved insight about business operations and make better, fact-
based decisions (Evans, 2012).
3. Business analytics is comprised of solutions used to build analysis models and
simulations to create scenarios, understand realities and predict future states
including data mining, predictive analytics, applied analytics and statistics (
https://www.gartner.com/it-glossary/business-analytics).
4. Business Analytics is the study of data through statistical and operations analysis,
the formation of predictive models, application of optimization techniques, and the
communication of these results to customers, business partners, and college
executives (Galleto, 2018).
5. Business analytics refers to a broad use of various quantitative techniques such
as statistics, data mining, optimization tools, and simulation supported by the
query and reporting mechanism to assist decision makers in making more
informed decisions within a closed-loop framework seeking continuous process
improvement through monitoring and learning (Min, 2017).
Business Intelligence (BI)
Now, let's look at what Business Intelligence (BI) is.
a. Business Intelligence as the process of collecting information from all sources
to make data-driven decisions in an organization (Fulton, 2013, Galleto,
2018).
b. Business Intelligence as the process of combining aspects of reporting,
monitoring and alerting, dashboards, scorecards, and ad hoc query data
exploration (Capistrano, 2018, Galleto, 2018).
Activity:
● Watch "Introduction to Big Data and Business Analytics" by Dr. Eric Capistrano
● Read articles by Fulton (2013), Min (2017), and Galleto (2018).
Business Analytics Concepts and Frameworks
Study Question
After learning about the different definitions of BA and BI, can you now
compare/differentiate BI and BA?
1.2. Origin of Business Analytics
From ancient times, people have this need to predict the future. They have used crude
methods likes stones and sticks to project how much crops they are going to harvest or how
much they are going to see. In this section, we shall trace the development of business
analytics from the ancient to the modern time
Activity:
● Read an article on "The Origin and Evolution of Business Analytics" by Hokey Min
(2017).
● Read an article on "The Evolution of Business Analytics" by Jess Hasson (2015)
Study Question
1. Trace the evolution of business analytics by writing down the features of analytics
(i.e., its application, tools used) as employed in the following eras:
Prehistoric
Industrial (1800s)
Information age (mid-20th century)
Internet age (21st century)
Business Analytics Concepts and Frameworks
1.3. Big Data and Business Analytics
We have already defined Business Analytics and Business Intelligence. This time, let us
learn another concept related to BA which is the Big Data. So, what is big data? SAS defines
big data as a term that describes the large volume of structured and unstructured data which
can be analyzed for insights needed for better decisions and strategic business moves. IBM,
on the other hand, refers to it as data sets whose size or type is beyond the ability of
traditional relational databases to capture, manage, and process the data with low-latency.
What is the difference? Business Analytics is said to focus on financial and operational
analytics of the business while big data involved machine automation to analyze data. The
importance of big data is not on how much data you have, but what you do with those data.
There are four aspects that defines big data which are volume, variety, velocity and veracity.
1. Volume is about how huge the data sets are.
2. Variety includes how many pieces of data we gather together from social media data,
government data, financial data, banking data, all sorts of transactions all combined
together to make one or more profiles for your customers.
3. Velocity is the speed of data.
4. Veracity means that there are a lot of uncertainty meaning, with all of these different
data coming altogether but the problem is we don’t know what to do with them.
Activity:
● Watch "Introduction to Big Data and Business Analytics" by Dr. Eric Capistrano
● Read the article "Difference between Big data and Business Analytics" from
https://talentedge.in/articles/difference-big-data-business-analytics/
1.4 Big Data Analytics Providers
A long list of big data service providers which are now available in the market can be found
in the Internet.
Activity:
● Watch "Introduction to Big Data and Business Analytics" by Dr. Eric Capistrano
● Read the articles "100 Most Promising Big Data Solution Providers - 2017 and
"Forbes Cloud 100: 10 Big Data Analytics Providers That Matter"
Business Analytics Concepts and Frameworks
References
100 Most Promising Big Data Solution Providers - 2017. Available from
https://talentedge.in/articles/difference-big-data-business-analytics
Big Data. What it is and Why it Matters. Available from
https://www.sas.com/en_ph/insights/big-data/what-is-big-data.html
Business Analytics. Available from https://www.gartner.com/it-glossary/business-analytics
Capistrano, E. 2018. "Introduction to Big Data and Business Analytics".
Evans, J. , 2012. Business Analytics: The Next Frontier for Decision Sciences. Available
from http://www.cbpp.uaa.alaska.edu/afef/business_analytics.htm
Fulton, Scott. 2013. Understanding Business Analytics. Available from
http://www.tomsitpro.com/articles/business_analytics-business_intelligence-
data_warehouse-cloud_computing-data_analysis,2-548.html
Galletto, M. 2018. What is Business Analytics?. Available from
https://www.ngdata.com/what-is-business-analytics/
Gartner Inc, 2012. Gartner Says Worldwide Business Intelligence, Analytics and
Performance Management Software Market Surpassed the $12 Billion Mark in 2011
Available from https://www.gartner.com/newsroom/id/1971516
Hasson (2015). The Evolution of Business Analytics". Available from
https://www.socialmediatoday.com/technology-data/2015-02-10/evolution-business-
analytics-infographic
Min, H. 2017. Introduction to Business Analytics. Available from
http://www.informit.com/articles/article.aspx?p=2494418
What is Big Data Analytics. Available from https://www.ibm.com/analytics/hadoop/big-data-
analytics
