First Column blog
There Are Answers In Your Company’s Data
When you’re making important decisions for your business, you need solid data to back them up. Through the use of business analytics, you can take advantage of your quantifiable data to find the right decisions for your business. We’ll discuss the process of using business analytics and how it can be used to your business’ advantage.
What Are Business Analytics?
To get started understanding business analytics, let’s use a hypothetical scenario. Let’s say you have a spinner with five sections numbered 1-5. Whenever you spin the spinner, it has an equal chance of landing on each section. If you spin it 100 times, you will encounter varied results, but let’s say that the results are like this: 1) 13 times, 2) 22 times, 3) 18 times, 4) 18 times, and 5) 29 times.
Predicting the results of another spin might seem random, but looking at the trends, we can make an educated guess. We could say that the spinner will land on an odd number relatively safely. The odds are in favor of this (3 out of 5 compared to 2 out of 5), but the historical data also correlates with this. Out of the 100 spins made, the outcome was odd 60 times.
The ultimate goal of this is to make decisions based on pre-existing results and statistical likelihood. In the above scenario, we’re using information to figure out which section (or sections) is most likely to be landed on, and the result is that an odd number is most likely.
Business Analytics in Action
Analytics are admittedly more complicated than this, but the basic idea still applies. You collect data, find patterns, and make the best decisions you can based on those patterns. A business can use this process in a variety of different ways:
- Data Mining: Data mining can be used to identify trends and opportunities that may have been overlooked, and it’s all thanks to the incorporation of business analytics.
- A/B Testing: A/B testing can help your business make better decisions, but it can also help remedy mistakes made in the past.
- More Accurate Predictions: Statistical analysis and predictive modeling can be used to make educated decisions and optimize the chances of achieving the wanted results.
Using Analytics to Your Advantage
Business analytics can be used to directly influence your business’ operations and procedures. You could improve your sales process using data and insights gleaned from analytics, allowing you to identify who your primary clients and customers are, as well as optimizing how you target them. Analytics can also be used to streamline your inventory management, business finances, and many other critical tasks.
How would your business use analytics? Let us know in the comments, and be sure to subscribe for more great blogs from First Column.