A startup may seem overwhelmed by the requirements and actions needed to maintain a competitive edge in an evolving and volatile market. While many entrepreneurs are eager to sell a unique product or service, pinpointing a target market and curating a sales strategy are just two of the many bottlenecks associated with a much more complex process.
On the other hand, established organizations can often become too comfortable in their success. Technology systems are evolving, younger companies are overtaking older ones, and today's popular solution can become tomorrow's VCR.
To avoid complacency and seek the best strategies that promote growth, both small and large organizations can benefit from harnessing big data available to them. Data science can be leveraged to generate insight, pinpoint inefficiencies, and curate unique marketing strategies that increase the bottom line.
While business intelligence solutions are an optimal solution for monitoring performance and optimizing real-time decision-making, data analytics can help management drill further down into data and answer complex questions. Here is an overview of BI vs. business analytics and how they can both help ensure a company's success.
What the Experts Are Saying About BI and BA: BI is needed to run the business while Business Analytics are needed to change the business. Pat Roche, Vice President of Engineering at Magnitude Software
BI is looking in the rearview mirror and using historical data. Business Analytics is looking in front of you to see what is going to happen. Mark van Rijmenam, CEO / Founder at BigData-Startups
What's the difference between Business Analytics and Business Intelligence? The correct answer is- everybody has an opinion, but nobody knows, and you shouldn't care. Timo Elliot, Innovation Evangelist at SAP
BI vs. BA
Business intelligence encompasses the collection and monitoring of data to generate insights that optimize operational management within an organization. BI tools include a wide variety of software systems and applications, including data mining systems and performance monitoring dashboards.
BI solutions are primarily utilized to answer real-time questions about what events or problems are occurring and what events occurred in the past. The insights generated from findings in the data help everyone meet key objectives and improve current decision-making.
BA is a subset of business intelligence that is frequently employed to optimize a BI strategy and improve future decision-making. Business analytics uses historical and current statistical values to forecast future events and generate recommendations that help optimize future growth. Unlike BI, BA drills down into why an event is occurring or why it did occur.
Analysts then pinpoint inefficiencies and find the best recommendations to make improvements in different areas of the business.
Organizations can use a combination of BI and BA to streamline workflows, find areas that need improvement, optimize a marketing strategy, and improve sales. While BI and BA can work together to help a company solve complex problems, both terms have different functions and purposes.
1. Analytics is More Desirable
Though business intelligence and business analytics are frequently searched terms online, more organizations are seeking out analytics software solutions than BI tools. This reflects the growing pattern of analytics becoming its own umbrella designation rather than simply being a subset of BI software tools.
This is primarily due to the increasingly high demand that many organizations have for analysts, coupled with the short supply of analysts available. Analysis is more sought because it requires an understanding of machine learning, neural networks, data mining, and other functionality that isn't included within a lot of BI software.
Furthermore, analysis allows organizations to map out a growth strategy, optimize inventory management, and curate specific sales strategies for target customers. It allows management to focus on making the best decisions today to impact tomorrow, whereas BI is better at providing day-to-day performance monitoring.
2. BI Tools Optimal for Larger Organizations
BI tools are typically employed by larger companies to organize and streamline day-to-day operations. This is primarily due to a corporation's tendency to require the same processes across multiple locations, resulting in standardized best practices and increased efficiency.
Many startups or small companies employ analytics to determine where to reach customers, how to plan a sales strategy, or improve a marketing campaign. The business analysis allows smaller enterprises with access to large quantities of data to maintain a competitive edge with larger corporations.
Many larger established organizations also employ BA to optimize future decision-making, but BI tools are more commonly utilized to streamline organizational activities and monitor worker performance across multiple locations.
Some larger companies choose to implement a combination of BI and BA to improve a growth strategy and ensure the best results when altering business models.
3. Current vs. Future Focused Tools
Many established companies are more focused on present-day challenges because they have already proven their ability to stay competitive and meet market demands. Because smaller companies haven't yet gained a competitive edge, they have to make the best possible current decisions to increase their future chances at success.
Business data analysis allows organizations to use historical and current information to determine the best paths forward, while BI is employed by enterprises who are satisfied with the company's overall current performance.
Because BI can pinpoint inefficiencies in workflows, utilizing a BI tool may be enough for an established company that wants to make small improvements without changing the overall direction of the organization.
The Future of Business Analytics:
In conclusion, here are the key takeaways to remember about BI vs. BA and how they work together-
- BI is primarily used for performance monitoring and pinpointing inefficiencies while BA is employed to drill down into data sets and predict future outcomes.
- Many organizations use a combination of BI and BA to optimize performance monitoring while pinpointing opportunities for future growth.
- Differences between BI and BA include the popularity disparity between BI and BA, that BA tools are mostly used by smaller enterprises, and BI is more real-time focused while BA is more forward-focused.