Your company probably generates massive amounts of data. It collects data every time someone visits your website, buys something, leaves without buying, abandons their shopping cart, spends hours on one page or deserts a page after two seconds. It’s awesome, but the sheer quantity and scope of data produced and stored makes it difficult to see the wood for the trees… and that’s where BI and BA come in. But what’s the difference?
- Business Analytics is an umbrella term for all the approaches and technologies used to access and explore business data. The idea is to identify useful insights and trends to improve business planning and boost performance, and this usually involves statistical analysis and predictive modelling to make educated guesses.
- Business Intelligence also means accessing and analysing business data, and it has the same goal – to better understand how the business is performing, make better decisions, improve that performance and create fresh opportunities for growth
What does Business Intelligence deliver?
As a general rule BI talks about the whats and the hows, rather than the reasons why. With BI you can apply metrics to massive raw datasets, query them, mine them, carry out OLAP – online analytical processing – plus reporting, business performance monitoring, and predictive / prescriptive analytics. When you work with big raw data and want control over how you use it, drawing your own conclusions, BI will probably suit your needs best. Imagine you have access to a detailed Singapore business directory? You can see how BI might help you know the essential whats and hows hidden in the data.
BI tells you what happened, or is happening right now, describing the situation in real time, in forensic detail if that’s what you want. It handles historical data and new, which means it’s great for learning from past mistakes, building on past successes, and planning successful futures. But at the end of the day your expertise and judgment is what matters.
What does Business Analytics help you achieve?
BA, on the other hand, mainly predicts the future by blending advanced statistical analysis with predictive modelling to give you an idea of what to expect, which in turn means you have the tools you need to improve future outcomes.
Both approaches are valuable in their own way. Imagine you’ve come up with some predictions about future growth using BA. The thing is, if you can’t also drill down into the underlying data to understand the basis of the predictions, they can’t fully inform good business planning.
There’s another way to look at it. Some say BA is merely the user-facing, self service end of BI, in other words the dashboards and displays. In this case Business Analytics simply means tailoring analytics and BI for non-technical and business users. In the past, BI was the province of IT analytics professionals. Now self-service BI lets non-technical people harness front-end tools to make their own dashboards and manipulate data on demand… and that sounds an awful lot like BA. On the other hand some say Business Intelligence is a subset of Business Analytics, with BA including data warehousing, information management, predictive data analytics, reporting and BI. Look at it this way and BI remains the descriptive element of data analysis, but BA also means BI, plus the predictive elements and everything else affecting the way data is dealt with.
Having said all that, are today’s distinctions meaningless?
Some experts believe the distinction between BA and BI is meaningless, with so little difference it isn’t worth separating them. And it really doesn’t really matter in the great scheme of things. Businesses will always want insight about their audience, products and performance. The skills and expertise needed to do so are the things that change. And they will probably keep on evolving, blending BI and BA ever more closely until there’s no difference at all.
So does any of the above help you to choose the right BA or BI technology?
Again, it’s tricky. Your first step is to figure out which business goals you want to resolve with BA or BI. Your second step is to work out which tech, tools, and approaches you’re best off investing in to find out what’s going on and meet those goals. Drill down to identify exactly what you want the system to do, who will use it, what level of detail you need, how much control you want over the source data and the processes.
Knowing all that should keep you on the right track, informing the level of self-service that’s best for your business and pinning down whether you’d like your analytics more descriptive or more predictive.
