What is Business Analytics?
Business Analytics is about using data and models to make better decisions, to improve policy making, to develop strategy and to improve day to day performance of organisations. In other words, it’s the application of management science.
Business Analytics consultants work in large and small companies around the world. They help airlines ensure that staff and aircraft are where they are needed, when they are needed. They help hotel companies decide how their room rates will vary through time so they don't lose money on empty rooms. They help banks and finance companies weigh up credit risks to determine lending policies. They help healthcare providers to keep waiting times down whilst providing excellent service. They help supermarkets plan their stocks so that products are on the shelves when needed. They help manufacturers ensure that their products are made when customers need them, at the right price and quality. In short, they help successful organisations do even better.
Business and public sector organisations must operate efficiently and effectively, and must strive to meet the needs of their customers and service users. To do this, they routinely collect data about their operations and interactions with customers and service users. Supermarkets track the sales of each product to know when to increase supplies, when to offer promotions and when to offer shelf space to new products. Airlines carefully track the seats sold on each flight, adjusting ticket prices to ensure that they make money whilst filling their planes. Hospitals track the treatments they provide to patients and aim to minimise hospital stays whilst providing excellent healthcare.
However, collecting data is not enough. The key is to use it to advantage, so as to increase profits, reduce costs and provide a better service. Managers and decision makers need to know what is happening now, what is likely to happen next and what actions they should take. The aim of Business Analytics is to use analytical skills to make a difference, based on the systematic exploration of key issues using available data.
The essential skills
Business analytics consultancy has several key elements:
- A systems approach – to understand key issues in their context, so as to avoid making something else worse when making changes intended to improve things.
- Quantitative skills – to use data and build models that enable people to carefully consider options before making any changes, thus minimising risk.
- Organisational understanding – to ensure that any recommendations and changes are appropriate and can be properly implemented.
- Information management – it is important to know how to design and use information systems to make the intelligent use of data.
- Project management – to get things done on time and within budget.
If you look at the modules available to Business Analytics students at Lancaster you will see that these are the topics that we cover. Business Analytics combines the power of operational research, operations management and project management. This combination of skills is highly attractive to employers, is intellectually stimulating, and forms the basis for an enjoyable and well-paid career.