Many of our clients have moved forward to being data-guided, making investments in business intelligence (BI) capabilities to harvest their valuable asset – DATA. They are building data marts (AKA data warehouses) to transform transactional data into analysis-ready data, they are merging multiple data sources, automating daily data refresh (ETL’s) and creating dashboards to visualize data. All of these activities are vital in order to create the “single version of the truth” that leaders and staff can use with confidence in order to make decisions to advance the association’s mission. But what happens after that? Although seeing accurate information in a visual form is the first step to making data-guided decisions, many find it hard to be content because they inevitably want more. Once you have the what….you want the why – and then you want to know how can you use this knowledge to influence the future by making better decisions?
The logical next step is Business Analytics (BA). What does this mean? Business analytics (BA) is the practice of iterative, methodical exploration of an organization’s data with emphasis on statistical analysis such as predictive analytics. Business analytics is used by organizations committed to data-guided decision making.
Associations are using business analytics to identify members “at risk” for non-renewal, as well as identifying individuals “at risk” for not registering for the annual conference, seminars or donations. BA is also used to identify new audiences and those new products and services that are most likely to succeed. The retail world has been using business analytics for decades (Amazon, Netflix) and the risk models used by credit card companies for extending credit are entirely based on business analytics and predictive modeling. Law enforcement uses business analytics to predict peak crime locations and times so they can deploy adequate personnel to keep us safe.
Business Analytics requires advanced statistical analysis by knowledgeable business analysts. Below is a chart comparing the main distinctions between business intelligence and business analytics:
|Business Intelligence||Business Analytics|
|Answers the questions:||What happened?
When? Who? How many?
|Why did it happen?
Will it happen again?
What will happen if we change x?
What else does the data tell us that never thought to ask?
|Includes:||Reporting (KPIs, metrics)
Automated Monitoring/Alerting (thresholds)
OLAP (Cubes, Slice & Dice, Drilling)
Ad hoc query
Once your association has adopted a BI program and you are ready to use data to create the future, you are ready for BA!