EMERGENCE OF BUSINESS ANALYTICS

Abstract:

In 2009, business analytics was regarded as a management philosophy which prescribes working on rich yet unstructured data sets to gain insights into critical problem areas and improve decision-making". Several scientists agree that business analytics is a set of capabilities. From this school of thought come several definitions. For instance, in 2007, it meant using the data extensively. It included quantitative data for testing the explanatory and predictive models to decide and act. In 2010, it was changed to using data, analysis and systematic reasoning for arriving at a particular decision. It was found that most of the firms use both quantitative and qualitative techniques." In 2011, the definition was further modified. According to that definition, business analytics relates to how companies make use of their databases, models (both explicative and predictive) and the like, and manage things based on facts to arrive at a particular decision or action. Another definition in the same year was a much comprehensive one. It suggested that business analytics refers to developing insights by applying various models such as statistical, contextual, quantitative, predictive and cognitive, among others, to plan, decide, execute, manage, measure and learn." It was also reinstated what was said in 1997 that business analytics can comprise of the following: descriptive, predictive or prescriptive. Data analytics would certainly fail if data are not of high quality. Since business analytics guides the top management to formulate strategics, the organizations using poor data are bound to taste the dust. An apt saying lor this phenomenon is 'garbage in, garbage out'. Here, data quality includes the rigour with which the data are collected, the appropriateness of the source/respondent, the correct parameters and scale on which the data are collected, and inclusion of all the required variables in the questionnaire that are necessary for analysing the data and achieving the objective.