Business analytics can turn your data into success

In today’s tight economy, every business tries to cut their operational cost, improving customer experience, maximize performance and minimize risk.  The challenge is how!  How can we work smarter and more efficient? How can we improve decision making, recognize new opportunity, maximize cost saving and determine inefficient processes.  The answer lies in our data!

Business analytics empowers us to transform data into information which is the foundation of our success.  For example, we can profile our customers based on their purchasing patterns, past activities and profitability to our business.  We can invest more resources to our best customers and determine what they are interested.  Predictive model can help us to analyze customers’ behavior, e.g. if they prefer buy one get one free or 30% discount.  We can use business analytics to improve our business processes.

From Data to Information

In order to make a smarter and more efficient decision, we need different types of information.  There is no single Swiss army knife that can answer all our questions.  We need a suite of tools:

• Standard reports
• Ad hoc reports
• Dashboard and key performance indicator (KPI)
• Online analytical processing (OLAP)

They have various usages and help us to answer different questions.

Standard reports and ad hoc reports are traditional tools that typically answer simple questions about the past, e.g. what is the income for Q2, 2010?  Dashboard and KPI provide high level overview to our senior management about how our business performs, e.g. are we meeting our sales target?

Today’s competitive environment won’t allow us to make a decision in months or weeks.  We only have hours or even minutes.  This is why OLAP is getting very popular in the past 10 years because OLAP allows us to make decisions based on accurate, comprehensive, consistent and timely information.

During the last few years, advanced analytical tools are getting more user friendly.  We don’t need a PhD in mathematics or statistics to master the advanced analytical tools such as the following:

• Statistical analysis
• Predictive modeling
• Optimization
• Planning
• Simulation

With these advanced analytical tools, we can easily:

• Explore and find pattern in the data.
• Making business decision that is based on the projection from the predictive model.
• Better equip our business with simulation
• Minimize the risk with optimization.

What tools are available?

There are four major players, – SAP, Oracle, IBM and Microsoft plus a few other independent business analytics vendors, e.g. SAS, MicroStrategy and Information Builders in the market.

Open source and Software As A Service (SaaS) are small but they are growing strong. Most of the recent implementations have been among “cost conscious” small and medium business. JasperSoft, Actuate and Pentaho are a few examples.

Personal business analytics tools are also available.  The most successful one is definitely Microsoft Excel.  If you have been working with Excel, you may already be familiar with What-if analysis.  But Excel has also bundled a few free and powerful analytic tools.  Microsoft Solver add-in and Solver Foundation can be used for planning, optimization and simulation ; Analysis ToolPak, a statistical toolkit that delivers 19 statistical methods to analyze data.

I have to mention the latest Excel 2010 add-in, PowerPivot, an in memory OLAP tool. I like it so much that I wrote a series of articles on my blog to discuss its power and features.  If you already know Pivot Table in Excel, then you know how to use PowerPivot.  It can analyze millions of records in seconds.

Conclusion

In order to survive, we cannot afford to make wrong decision. This is why we need business analytic to transform data into accurate, consistent and timely information. What tools are you using now?

Andrew Chan is the owner and founder of ALG Inc.

We help you to make better and faster decisions!