These days, data is a crucial business asset – in fact, it’s revolutionising how modern businesses operate across many of the world’s primary sectors and industries. That’s why all businesses, regardless of size, age or niche must be data-driven.
So, what is data analytics? And is it worth the hype? Here’s why your business should be jumping on the band wagon.
What are data analytics?
As the name suggests, data analytics is the science of collecting, processing, analysing and storing raw data for the purpose of unearthing insights and drawing conclusions. In recent years, the data analytics industry has exploded exponentially. This is largely due to the increasing amount of data being generated and collected by large and small businesses alike.
Of course, there is little point in collecting enormous swathes of data if you have no way of analysing it. Fortunately, technology within the data analytic industry has advanced in great strides in the last decade. As a result, many of the techniques and processes used to leverage data are largely reliant on mechanical processes, machine learning, AI and advanced algorithms that can transform raw data into actionable insights.
In a nutshell, data analytics is…
- The science of analysing raw data for the purpose of unearthing both emerging and existing trends and patterns, as well as actionable insights
- A way for businesses to optimise performance, boost productivity and maximise profits
- Automated techniques and processes that allow businesses to make informed, data-driven decisions based in fact, not opinion
Any type of information can be subjected to data analytics. Doing so can reveal trends and patterns that would otherwise be lost in a mass of information. For obvious reasons, this is hugely important for modern businesses looking to gain a competitive edge.
The importance of data analytics
Data analytics is important because the process aids businesses in optimising their performance. Implementing it into your business model means your organisation can reduce overhead costs by identifying more efficient ways of doing business. You can also use data analytics to make better business decisions informed by real data, not opinions, as well as analyse customer trends and satisfaction for the purpose of improving products and services.
If you want to avoid drowning in useless data, it is imperative for your business to develop a robust, forward-thinking strategy. Data must address a specific need your business requires as well as help your organisation reach a specific strategic goal. This will generate real value and help assist your business in gaining a competitive edge. To do so, you’ll need to define your key challenges, and then collect the data you require to address them.
Types of data analytics
When it comes to data analytics, there are a diverse array of specialist platforms and data suites that can aid a business in implementing analytics in their day-to-day operations, including data visualisation platforms such as MS Power BI, reporting tools, data mining programs and open-source languages for data manipulation and replication. There are also number of different approaches and types of solutions.
Data analytics can be broken down into four types, including:
- Descriptive – Utilising historical data, descriptive analytics gives a business a picture of their current performance as well as any past patterns or trends on which they can build a long-term strategy.
- Diagnostic – Diagnostic analytics looks at the “why” in data. It is characterised by methods like data mining and data discovery, and is considered advanced analytics.
- Prescriptive – Prescriptive analytics is the “what” to the “why” of diagnostic analytics, and asks questions such as “what can we do to get a better outcome”. This type of data analytics often utilises graph analysis, simulations, AI and complex event processing.
- Predictive – Predictive analytics is the process of utilising data to spot future trends and patterns. Predictive analytics helps businesses make better educated, data-driven decisions by using statistical algorithms, AI and machine learning.
Why you should be jumping on the band wagon
In our modern world, data is becoming the key to gaining a competitive advantage. As a result, the ability of a business to compete with others in a specific market niche is being increasingly influenced by how well it can use data, apply analytics and integrate new technologies in its day-to-day operations.
For a modern business, information is power. With huge growth forecast for the analytics industry, as well as rapidly evolving techniques and technologies, the importance of data across every aspect of the business world is set to increase tenfold over the next few years. If your business views data as a strategic asset, implements a data culture, employs efficient data leadership and develops robust analytical strategies now, you’ll be more likely to succeed in a data-driven world.
Final thoughts
So, what is data analytics? And is it worth the hype? The answer is a resounding yes.
Today, data is a vital corporate asset that is revolutionising the world’s major sectors and industries. The fact of the matter is that, regardless of size, age or niche, all modern organisations must be data-driven. Why? Because information is power.
The relevance of data in every element of the corporate world is expected to increase tenfold over the next decade due to the enormous expansion that is predicted for the sector as well as the fast-emerging techniques and technology driving the industry’s growth such as AI and machine learning. You’ll have a better chance of succeeding in a data-driven future if your company considers data as a strategic asset now. As a result, there has never been a better opportunity to hop on the band wagon before it leaves the station.
