12 Reasons Why Business Analytics Is Important In Digital Age

What is Business Analytics?

Business Analytics is the systematic exploration, analysis, and interpretation of data to extract valuable insights that guide strategic business decisions. It involves the application of statistical methods, predictive modelling, and advanced analytical techniques to interpret complex datasets, providing organisations with a competitive edge by enabling data-driven decision-making. 

By leveraging historical data and forecasting future trends, businesses can optimise operations, enhance efficiency, and uncover growth opportunities, making Business Analytics an integral component of modern business strategy.

The Importance of Business Analytics

Business Analytics is a process of gathering, analysing and drawing valuable conclusions from the vast amount of data available. Today, businesses, regardless of size, use analytics tools to determine how data can be leveraged to solve problems and increase efficiency and revenue.

To help you understand how business analytics works in real life, let’s look at an example: we are all aware of Uber, the ride-hailing cab service. What is it primarily used for? To enter your pickup location and wait for the cab. While this seems pretty straightforward, a lot of data wrangling goes behind it. 

For starters, Uber uses its algorithms to find look-alike trips, i.e., a ride that starts near ends near and happens around the same time as another ride. Using this data, Uber can cater to passengers willing to have a similar journey but by paying less. And this is where the Uber Pool feature comes into play. By analysing data, Uber can serve more people, ensure its drivers are occupied and make more money. This is a straightforward example of how a simple ride-hailing app like Uber can transform its services using data.

Business analytics is a broad field that includes varied types, applications, and components. Are you interested in learning everything about Business Analytics? 

If you want to understand how this field is increasing, why it is so important, and how to make a career, continue reading this blog.

Why Is Analytics Becoming More Popular Now?

Analytics has become the buzzword of this decade. Almost every business type focuses on using it to change how it makes decisions. But why has it become so popular right now? Why does nearly every company want to hire business analytics professionals?

The reasons behind this swift drive are need, availability and affordability. Starting with the first factor, businesses are under constant pressure to innovate due to the increasing competition. Plus, customers have become more demanding. So, to survive, managers must make the best decisions promptly to respond to market-driven forces. Analytics is a promising method for gaining insights to make better and faster decisions.

When it comes to availability and affordability, organisations are collecting tremendous data. This is mainly due to the recent technological advances and the affordability of software and hardware. So basically, companies have all the raw data possible. Still, they need experts who can make sense of all of it and draw relevant outcomes.

So, business analytics has gained a lot of hype amongst businesses lately to have a competitive edge while saving time and money.

12 Reasons Why Business Analytics Is Important

By now, we are sure you might have a brief idea of business analytics, how it works and why it is the next big thing on the market.

As the title suggests, we will focus on why business analytics plays such a vital role in the growth of businesses. Let’s get started!

1. Enhance Customer Experience

With the variety of options available, customers are spoiled for choice. To ensure businesses can retain their customer base, they turn to analytics. For example, companies can analyse a customer’s interaction on their website and past purchasing habits. This data allows them to analyse patterns and improve their website performance. This can be as simple as sending a push notification prompting products that customers have added to their shopping cart. This will result in a better customer experience overall and, eventually, loyalty.

2. Make Informed Decisions

Businesses often outsource a few of their processes to enhance their efficiency. When selecting vendors for such activities, they need to know which will bring more profits. Analytics can help them evaluate supplier performance based on customer ratings, order fulfilment speed, quality, etc. This data will help them decide which one works best for their business.

3. Reduce Employee Turnover

Companies have to bear an extensive cost yearly due to employee onboarding and attrition. To save time and costs, HR professionals can use analytics tools to examine the likelihood of an employee aligning with a company culture, tracking their performance and satisfaction with the new role, and similar factors. Once you know such answers, it will be easier to recognise employees who will stick to your company for a long time.

4. Improve Efficiency

Efficiency is not always limited to employees. Businesses can also analyse other resources to learn more about their performance. For example, a grocery store chain reduced refrigeration costs by merely studying the temperatures of in-store coolers. It was found that the refrigerators were being kept several degrees lower than necessary, which increased power usage. So, by increasing the temperature, power costs went down without affecting safe food storage. Business owners can learn from such examples and use data to make their resources efficient.

5. Identify Frauds

Finance companies have begun using analytics to reduce fraud. One way they do this is by using data to identify potentially fraudulent purchases based on the analysis of customer’s previous transactions. These companies also use predictive analytics to look at customer profiles and gauge the level of risk. This helps rate a particular customer’s risk and use this analysis to prevent losses and build stronger customer relationships.

6. Cut Manufacturing Costs

One company that has outranked everyone when it comes to using analytics to reduce manufacturing costs is Intel. Initially, this tech giant would perform 19,000 tests on each manufactured chip. With the advent of predictive analysis, Intel could determine which chips needed which tests before their launch. By using the data collected from all of that testing, it has saved almost $3 million.

7. Make The Most of  Your Investment

Earlier, business people would rely on traditional marketing techniques to gain and retain customers. However, the internet has changed this completely. Now, search marketing has become the most efficient and inexpensive way for businesses to find leads. By using business intelligence, marketers can craft perfect campaigns and strategies, increasing the chances of higher ROI.

8. Improved Advertising

Advertising is expensive; hence, marketers must know how to get the best return on investment. This is why they use analytical methods such as A/B and C split-testing. When advertising online, all landing pages, pop-ups, and even product descriptions are evaluated and tweaked to ensure maximum results. How products are positioned on the website is assessed to identify the best location to drive more engagement and sales.

9. Better Product Management

When it comes to retail companies, they have more than a thousand products to offer. So, how do they decide which ones to release at which time? Yes, the answer is data analytics. Such businesses analyse the most popular products depending on the region and season. This data is then used to target the right product at the right time, which eventually positively impacts sales.

10. Tackle Problems

Whenever a problem arises, a business often pauses its current operations, which leads to a considerable loss. To prevent such situations, business analysts help the organisation make an informed decision by providing information that can help identify potential risks and avoid any occurrence of loss. These professionals can use the raw data to detect a malfunction in the existing system and thus help business owners fix it as soon as possible.

11. Accelerate Through Uncertainty

Look at the current business scenario. Owing to the global lockdown, the business environment is as uncertain as it gets. Very few people know when things will return to normal, and the corporate world will be allowed to resume its operations. At such times, data analytics can resolve supply chain issues, introduce crisis management solutions, optimise costs, and more.

12. Conduct A Competitor Analysis

Today, almost every business has a clear idea of its competitors. An effective way to get ahead of them is by understanding what they are up to, their strategies, USPs, etc. By gathering this data by conducting a SWOT analysis, you can preview how your business is performing compared to your competitors.

Need of Business Analytics for Business in the Digital Age

In the rapidly evolving landscape of the digital age, the need for Business Analytics has become paramount for organisations aiming to thrive in a data-driven environment. As businesses amass vast amounts of digital data, the ability to harness this information strategically is a competitive necessity. 

Business Analytics empowers enterprises to extract meaningful insights from this data, facilitating informed decision-making, identifying trends, and uncovering pivotal opportunities for staying agile and ahead in the dynamic digital marketplace. 

From optimising customer experiences to enhancing operational Efficiency, Business Analytics has emerged as a cornerstone for success in the digital era, offering a transformative toolset to navigate the complexities of the modern business landscape.

Why Business Analytics as a Career?

In the contemporary professional landscape, a career in Business Analytics has become increasingly compelling, offering a pathway to dynamic and high-demand roles. Business Analytics professionals are at the forefront of leveraging data to drive strategic decision-making, making them indispensable assets to organisations across industries. 

With a surge in the volume of data generated, the need for skilled analysts to translate this data into actionable insights has never been more critical. Embracing a career in Business Analytics provides an opportunity to be at the forefront of technological advancements. It opens doors to diverse industries, offering a fulfilling and impactful journey in data-driven decision-making.

Related Blog: MBA in Business Analytics: Salary, Scope, Fees, Benefits, Career & More

How To Start A Career In Business Analytics?

If you are willing to be a part of an integral team at any company and help it in the ways mentioned above, get ready to become a Business Analyst. Are you wondering how to go about the entire process of becoming a business analyst? We have a complete blog that will help you carve a path to successfully grab one of the most in-demand jobs of the decade.

Summary

That’s everything you need to know about the importance of business analytics in the digital age. Hopefully, by now, you have a clearer understanding of how this field is transforming businesses across the globe. With technological advancement, this field will only get bigger and better, providing more opportunities for aspirants.

Begin Your Career in Business Analytics with ASMs IBMR

We offer a PGDM in Business Analytics program to help you acquire advanced knowledge and skills to work as a Business Analyst. Plus, you will get international value-added certifications while completing this post-graduate degree. IBM, the leading company in business analytics, approved the course. So, if you want to excel in this field, immediately apply to IBMRs PGDM in research & business analytics. Get in touch to know more.