Funda Reviewer Prelim

CASTILLO, MARGAUX JULIENNE R
NCST: FUNDA: 10-1 SAT

PRELIM TERM
MODULE 1
Business Analytics
is the process by which businesses use statistical methods and technologies for analyzing historical data
in order to gain new insight and improve strategic decision-making.
Database storage areas have become so large that new term was devised to described them.
Big Data
describes the collection of data sets that are so large and complex that software systems are hardly able
to process them
Little data
describes the smaller data segments or files that help individual business keep track of customers.
Three terms in business literature are often related to one another:

1. ANALYTICS
Analytics can be defined as the process that involves the use of statistical techniques (measures
of central tendency, graphs, and so on), information system software (data mining, sorting
routines), and operations research methodologies (linear programming) to explore, visualize,
discover and communicate patterns or trends in data.
TYPES OF ANALYTICS:
Descriptive Analytics (What has happened?)
 is the application of simple statistical techniques that describe what is contained in the
data set or database.
 categorizes, characterizes, consolidates and classifies data. 4C’S
 includes dashboards, reports (e.g., budget, sales, revenue and costs) and various types
of queries.
 are most commonly applied to structured data, although there have been numerous
efforts to extend their reach to unstructured data, often through the creation of
structured metadata and indices.
 help provide an understanding of the past as well as events occurring in real-time.
 To identify possible trends in large data sets or databases. The purpose is to get a rough
picture of what generally the data looks like and what criteria might have potential for
identifying trends or future business behavior.
 Descriptive statistics, including measures of central tendency (mean, median, mode),
measures of dispersion (standard deviation), charts, graphs, sorting methods, frequency
distributions, probability distributions, and sampling methods.
Predictive Analytics (What should happen?)
 Helps predict (based on data and statistical techniques) with confidence what will
happen next so that you can make well-informed decisions and improve business
outcomes.
 This model is combined with historical data with rules, algorithms and other external
data to predict the outcome or a situation.
 Uses simulation models to suggest what could happen.
 Predictive analytics is the application of advanced statistical, information software, or
operations research methods to identify predictive variables and build predictive models
to identify trends and relationships not readily observed in descriptive analytics.
 Predictive. To build predictive models designed to identify and predict future trends.
 Statistical methods like multiple regression. Information system methods like data
mining and sorting. Operations research methods like forecasting models.
Prescriptive Analytics (What will happen?)
 Prescriptive analytics refers to analytics that seek to provide optimal recommendations
during a decision-making process. Unlike observational analytics or predictive analytics,
prescriptive analytics determines ways in which business processes should evolve or be
modified.
 To allocate resources optimally to take advantage of predicted trends or future
opportunities.
 Operations research methodologies like linear programming and decision theory.
2. BUSINESS ANALYTICS
3. BUSINESS INTELLIGENCE
ANALYTICS VS. BUSINESS ANALYTICS
MODULE 2
Business Analytics (BA)

can be defined as a process beginning with business-related data collection and consisting of sequential
application of descriptive, predictive, and prescriptive major analytic components, the outcome of which
supports and demonstrates business decision-making and organizational performance.
Business intelligence (BI)
can be defined as a set of processes and technologies that convert data into meaningful and useful
information for business purposes.
BA vs. BI
Business intelligence
 focuses on descriptive analytics
 BI answers the questions “what” and “how” so you can replicate what works and change what
does not.
Business analytics
 focuses on predictive analytics
 BA answers the question “why” so it can make more educated predictions about what will
happen.
1. Nominal
 1, qualitative/ categorical
 Names, Colors, Labels, Gender, etc.
 Orders does not matter
2. Ordinal scale data
 ranking/ placement
 the order matters
 Difference cannot be measured
3. Interval scale data
 Order does matter
 Difference can be measured
 No true 0 starting point
4. Ratio scale
 The order matters
 Difference are measurable (including ratio)
 Contains a 0-starting point
Building an Analytics Culture

Analytics culture cannot be built everywhere in
an organization. To establish it, an organization should be:
 Endowed with a great deal of data that is not fully utilized
 Important to the business success
 Led by a manager who already understands the importance of analytics
 Blessed with a cadre of people who have some analytical skills

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CASTILLO, MARGAUX JULIENNE R

NCST: FUNDA: 10-1 SAT

Three terms in business literature are often related to one another:

ANALYTICS VS. BUSINESS ANALYTICS

Business Analytics (BA)

Building an Analytics Culture

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