BA 170 – Business Analytics UNIT 1 Business Intelligence (BI) allows us to use data

strategically in:
INTRODUCTION TO BUSINESS INTELLIGENCE  EFFICIENCY - minimize the cost
ofselling/servicing the customer
A. Definition of Business Intelligence
 EFFECTIVENESS - real-time access to customer
information across every point of contact, at the
Introduction
line-of business
 Business intelligence is no longer a luxury
 DIFFERENTIATION - ability to proactively Business Imperatives
limited to enterprise-level organizations.
 Entrepreneurs and marketers alike understand manage opportunity and risk at every point of - Your mission and vision
that now, more than ever, it’s important to customer contact, at the enterprise, at the - Goals that company promises to achieve
make data-driven decisions. affinity partner - Major change or goal that a company to reach
 The secret to making BI tools work successfully
for you is a seamless collaboration with BUSINESS DRIVER 1. Understand Customer Needs
operations and IT. 2. Revenue Creation – profit
– factors that controllable by the business organization
 The challenge comes when you try to leverage
- Resource, process, conditions that is vital for business 3. Cost Optimization – minimizing our cost as
that collaboration.
growth and continued success much as possible without sacrificing the quality
services or product
Business Intelligence
o Business Strategy 4. Enterprise Transformation – desire in
❑ umbrella term that combines architectures, tools, expanding the business
o Business Initiative
databases, analytical tools, applications, and 5. Technology Transformation – to become
methodologies Business Strategy – course of action or set of decision competitive
❑ enable easy access to data (and models) to provide which assists the entrepreneurs, business owner or the
managers with the ability to conduct analysis management in achieving specific business objective
❑ transform data to information (and knowledge) to
decisions and finally to Action Business Initiatives – internal campaigns, the seek to
improve an organization’s work environment company B. The Evolution of Business Intelligence
Data - these are unprocessed facts (ex. scores, long culture or overall business strategy.
exam, quizzes and projects) External project: community service, non-profit
1865 Richard Devins first uses the
fundraising. The very term Business intelligence in
Information – these are processed data (ex. final
beginning his book “Cyclopedia of
numerical grade or average)
Business Intelligence (BI) Commercial and Business
“The processes, technologies and tools needed to turn Anecdotes”
data into information and information into knowledge 1956 IBM invents the hard disk
The Hard Drive drive which allows for digital
and knowledge into plans that drive profitable business
storage of vast amount of
action. BI encompasses data warehousing, business
data
analytics and knowledge management.”
The Data Warehouse Institute, Q4/2002 1958 IBM computer scientist Hans
The Father of BI Peter Luhn writes a 2018 The shift to industry-specific, - A cloud based method of providing software to
– Hans Peter landmark article on BI called Vertical Business vertically-aligned solutions users so users subscribe to an application rather
Luhn “A Business Intelligence Intelligence that cater to select market than purchasing
System” niches rather than trying to - Application that runs in cloud servers
1970 Decision Support Systems serve all market, thus
- EX. Gmail, Office 365
The Jump from (DDS) are the first database delivering an application that
Theory to management systems to be is finely tuned for industry-
Practice developed specific processes, Cloud Storage
1988 The Multiway Data Analysis requirements, and best - A way of business and consumer to save data
The Multiway Consortium in Rome inspire practices securely online so that it can be access anytime
Data Analysis the first text specifically from any location and easily shared
Consortium in written on business Queen Elizabeth II – first sender of email - Way to back up data
Rome intelligence IBM – International Business Measurement
1993 OLAP (online analytical
The OLAP Cube processing) is coined by
DDS (Decision Support System) C. Reasons of Investing in, Benefits, and Challenges of
Edgar F. Codd becomes
known as the father of the - Computerized program used to support Business Intelligence
rational database determination judgement and courses of action
1995 The sales of PC’s rise nearly in an organization or business
The Personal 700% between the year of - Analyze massive amount of data Reasons of Investing in Business Intelligence
Computer and 1994 and 2000 and is
the Internet mirrored an exponential OLAP (Online Analytical Processing) Factors Description
increase in internet users
- A technology behind managing business
2001 Based on the application Markets  Strong competition
Software as a service providers (ASP) intelligence application
 Expanding global market
Service model, the term Saas is first - Powerful technology for data discovery and  Blooming electronic markets
used limitless report viewing on the internet
2006 Amazon Web service  Innovative marketing
The rise of The introduces their cloud ASP (Application Service Providers) methods
Cloud and storage service that is gains - They provide application and related services  Opportunities for
mobile widespread recognition and outsourcing with IT support
over the internet
adaptation for cloud  Need for real-time, on-
technologies - Through a wed browser
demand transactions
- Dropbox - Multitenant version model is commonly known
Consumer  Desire for customization
- Google drive as SaaS (outsourcing) important alternative for
Demand  Desire for quality, diversity
2016 Increasingly user-friendly small-medium business with limited information
of products, and speed of
Democratizing solutions allow users with or budget delivery
Data and The outside of the field of
 Customers getting powerful
Rise of Citizen statistics and analytics to
SaaS (Software as a Service) and less loyal
Data Scientists uncover actionable insights
within their business data Technology  More innovations, new
products, and new services
  Increasing obsolescence rate - Choose a full stack, an end-to-end tool that includes a E. Characteristics of Successful Business Intelligence
 Increasing information powerful back-end
overload - Choose a business intelligence tool that grants the ability Characteristics of Successful BI
 Social networking to create advanced filters and calculations
Societal  Growing government - Choose a tool that’s designed to handle complex queries  Business sponsors are highly committed
regulations and and large datasets and actively involved in the project.
deregulations - Invest in a BI tool that has powerful BI technology  Business users and the BI technical team
 Workforce more diversified, work together closely.
older, and composed of  The BI system is viewed as an enterprise
more women resource and given adequate funding and
 Prime concerns of homeland guidance to ensure long-term growth and
security and terrorist attacks viability.
 Reporting-related  Organization provide users both static and
regulations, data privacy act D. The Business Intelligence Process
interactive online views of data.
 Increasing social
 The BI team has prior experience with BI
responsibilities of companies
and is assisted by vendor and independent
 Greater emphasis on
consultants in a partnership arrangement.
sustainability
 The company’s organizational culture
reinforces the BI solution.

Benefits of Business Intelligence

F. Guidelines for Successful Business Intelligence

1. BI answers business questions

2. BI provides opportunities to cut costs and time Step 1: Establish a BI Vision and Evangelize it
investment
EXAMPLE of BI: Step 2: Develop a BI Roadmap to Prioritize BI Initiatives
3. BI delivers valuable insights
4. BI promotes collaboration and cooperation
Step 3: Establish BI Governance & Funding Process
Challenges of Business Intelligence
Step 4: Establish BI Competency Center (BICC)

1. You’re not sure what you are measuring Step 5: Align Business and IT for the Long Haul
2. You’ve got a data, but it’s a mess
3. You have the tool, and data, but there;s coding Step 6: Measure and Track ROI/Benefits from BI
4. You’re not getting answer fast enough
5. BI tools that don’t scale with your team Step 7: Build Trust in the System

Overcome BI Challenges - in a Nutshell

- Choose a BI tool with the depth and design

 Late 1800s
2. Gaining insights The advent of scientific
3. Improved business operations and better fact- Management
based decisions
(Evans, 2017) Frederick Taylor – introduced the first ever system
of business analytics in the USA and he called the
Analytics and Analysis “Scientific Management”
Scientific Management – The purpose of this system
Analysis (interpretation Analytics (use of was to analyze the production technics and laborers
from the information that software into body movements to identify greater efficiency.
has been provided) transforming our data Early 1900s
intoinformation) The transformation of the
❑analysis as what a ❑analytics as what a manufacturing industry
person is doing when computer is doing when
BA 170 – Business Analytics UNIT 2 they are interpreting it accepts, stores, Henry Ford – he was inspired by Frederick Taylor’s
information, gathering it calculates, and makes Scientific Management, he hired Taylor as his
INTRODUCTION TO BUSINESS ANAYTICS into a coherent resulting information consultant
understanding, and available for New Millennium
The tools of business analytics can aid decision making building a narrative or examination. Availability of different
by creating insights from data, by improving our ability to plan of action in analytical solution
more accurately forecast for planning, by helping us response
quantify risk, and by yielding better alternatives through ❑the detailed ❑the systematic Ex. IBM, Microsoft, SAP and Oracle were at the
analysis and optimization. examination of the computational analysis forefront of offering such solutions to change the
elements or structure of of data or statistics”. way business function.
Indeed, a recent study based on a large sample of firms something”. Late 1900s
that was conducted by researchers at MIT’s Sloan School The emergence of Busines
of Management and the University of Pennsylvania, Intelligence
concluded that firms guided by data-driven decision A.2. Evolution of Business Analytics
making have higher productivity and Ralph Kimball and Bill Inmon – Proposed similar
market value and increased output and profitability. 1800s strategies to build data warehouses.
(Camm, J.D., et.al., 2015) The need to stay ahead – businesses are now 1950s
competing The first hard drive disk by
A. BUSINESS ANALYTICS International Business
- scientific process of transforming data in to Machines (IBM) Corporation
insight for making a better decision 1865 – first use of data to stay ahead of his 2005
- it is a data driven of fact-based decision-making competitors Accessibility of Data for the
common people
1. Data
- Information technology
- This is when google analytics was introduced, they
- Statistical analysis Richard Miller – was always one step ahead of wanted to provide a free and accessible way for users
- Quantitative methods actively gathering information and acting it before to analyze their website data.
- Mathematical-based models any of his competitors. 2005-2020
- Computer-based models The bread and butter
 for companies globally  Descriptive statistics – measure of variations,  Decision analysis
variability  Utility theory
- Beginning of cloud computing.  Data Visualization – charts, maps
- Big data cloud computing and business analytics  Data Dashboards – collection of tables, charts
have some integral for almost all companies. and ,maps Advanced Analytics
- Used to monitor specific aspect of companies - Predictive and prescriptive analytics are
A.3. Impacts and Challenges of Business Analytics performance related to their decision making sometimes therefore referred to as
and responsibilities
Impacts and Benefits of Business Analytics
A.5. Business Analytics in Practice
1. Help improve profitability Predictive Analytics
2. Increase market share and revenue - Emerging as a game changer Spectrum of Business Analytics
3. Provide better return to shareholders - Helps executive answered what is next and
4. Facilitates better understanding of available what should we do about it
primary and secondary data that affect - Predict what may happen in the future by
operational efficiency examining historical data
5. Provides competitive advantage - It consists of techniques that use models
6. Converts available data into information constructed from past data to predict the future
or ascertain the impact of one variable on
Challenges of Business Analytics
another.
 lack of understanding of how to use analytics
“What’s next?”
 competing business priorities
“What should we do about it?”
 insufficient analytical skills
 difficulty in getting good data and sharing Business Analytics in Practice
 Linear Regression
information
 Time Series Analysis Business Application of Analytics:
 not understanding the benefits versus perceived
 Data Mining – technique used to find patterns
costs of analytics studies
and relationships among elements of the data in  Financial Analytics
a large database, often used in predictive  Human Resource Analytics
A.4. Scope of Business Analytics
analytics  Health Care Analytics
 Simulation  Supply Chain Analytics
Three Broad Categories
1. Descriptive Analytics  Analytics for Government and
Prescriptive Analytics  Nonprofits
2. Predictive Analytics
- it is to identify the best alternatives to minimize  Sports Analytics
3. Prescriptive Analytics
or maximize some objective and indicates a best  Web Analytics
Descriptive Analytics course of action to take.
- The use of data to understand past and current
business performance and make informed "What is the optimal or best way to respond to given
decisions business rule and future conditions?”
“What happened in the past?’
 Optimization models
 Data queries  Simulation
 optimization
 VARIETY Answer: Business Intelligence
• The types of data: structured, semistructured,
unstructured. 4. A class of software programs capable of supporting
transaction-oriented application on the Internet.
VELOCITY
• The speed at which big data is generated Answer: Online Transaction Processing System

VERACITY 5. Increasing Obsolescence rate

• The degree to which big data can be trusted.
Answer: Technology
VALUE
• The business value of the data collected 6. Need for real-time, on demand transactions

B. INSIGHTS INTO BIG DATA VARIABILITY Answer: Markets

• The ways in which the big
B.1. DEFINITION OF BIG DATA 7. Desire for quality of diversity of products, and speed of
data can be used and formatted
delivery
Big data is simply a set of data that cannot be B.3. BIG DATA CHALLENGES
managed, processed, or analyzed with commonly Answer: Consumer demand
available software in a reasonable amount of time.  Companies are being bombarded with data and
8. Greater emphasis on sustainability
may not be
❑It comprises of traditional company produced  proficient in handling and analyzing trillions of Answer: Societal
data such as customer relationship management bytes of data
(CRM), administrative and financial particulars,  Company’s paucity of infrastructure to manage 9. The BI system is viewed as an enterprise resource and
management information systems, supply chain the sheer volume given adequate funding and guidance to ensure long-term
operations , etc that can be stored in the company’s  of data growth and viability.
database.  Lack of appropriate capabilities
 Threat of data integrity Answer: True
❑It also comprises of content such as social
Unit 1 and 2 quizzes 10. It is a major change goal that your company promises
media, video, sensor data (produced by clicking links
to reach,
on social networks) and email.
1. The company’s organizational culture reinforces the BI
solution. Answer: Business Imperatives
❑But the term Big Data is coined for the above
kinds of data when it is too big for conventional Answer: True 11. It is the use of data, information technology, statistical
systems to control it. Size alone is not an indicator analysis, quantitative methods, and mathematical or
for bigness. 2. It is a central pool of skilled resources and specialists computer-based models to help managers gain improved
which can be shared by all business units. insights about business operations and make better fact-
B.2. THE SIX V’S OF BIG DATA based decision.
Answer: Business Intelligence Competency Center
VOLUME Answer: Business Analytics
• The amount of data from 3. It transforms data to information (and knowledge) to
myriad sources. decision and finally to action.
12. It is the process of transforming data into actions 19. It is what a person is doing when they are interpreting
through analytics and insights in the context of information, gathering it into a coherent understanding,
organizational decision-making and problem-solving. and building a narrative or plan of action in response.

Answer: Business Analytics Answer: Analysis

13. The tools of business analytics can aid decision
making by creating insights from data, by improving our 20. It is the use of data to understand past and current
ability to more accurately forecast for planning, by business performance and make informed decisions. It
helping us quantify risk, and by yielding better encompasses the set of techniques that describes what has
alternatives through analysis and optimization. happened in the past.

Answer: True Answer: Descriptive analytics

14. It consists of techniques that use models constructed

from past data to predict the future or ascertain the impact
one variable on another.

Answer: Predictive analytics

15. He introduced the first-ever system of business

analytics in the United States of America called scientific
management.

Answer: Frederick Taylor

16. It is to identify the best alternatives to minimize or

maximize some objective and indicates best course of
action to take.

Answer: Prescriptive analytics

17. It is the scientific process of transforming data into

insights for making better decisions. It is used for data-
driven or fact-based decision making which is often seen
as more objective than other alternatives for decision
making.

Answer: Business Analytics

18. Predictive and Prescriptive analytics are sometimes

therefore referred to as

Answer: Advanced analytics