WITH INFORMATION BEING TRANSMITTED ACROSS ORGANISATIONS IN SPLIT SECONDS,THE NEED FOR BUSINESS ANALYTICS HAS BECOME IMPERATIVE TO MAKE CRUCIAL BUSINESS DECISIONS. RADHIKA RAMASWAMY FINDS OUT MORE ABOUT THIS EMERGING FIELD.
We live in an era of information. Today, every organisation across the world thrives on its single-most crucial asset called ‘data’. What is intriguing is that a huge volume of data is collected across organisations from various sources in zillion different forms, at just the blink of an eye. The ability to mine this data, and use the right set of statistical and quantitative tools to analyse it, is imperative for the success of any business. It is here that business analytics comes into focus.
Business analytics refers to the investigation and analysis of past business performances in order to gain insights and devise business plans for the growth of a company.
ORIGIN AND GROWTH
Ramesh Kumar, senior vice-president, Symphony Services, an international company (with its branches in Bangalore, Pune, etc) that specialises in business analytics, points out that though the term business intelligence came into existence in the early 90’s, the science of it has been in existence from the days of mathematics. He says, “Business intelligence involves collecting data, researching and summarising it to derive meaningful information to make decisions. The advancement of this science by using mathematical models and simulations, given different conditions and changes, was the next step, which came to be called ‘analytics’, a term that was coined in the 90s.”
Prahalad Venkateshan, a professor from the production and quantitative methods department, Indian Institute of Management - Ahmedabad (IIMA), informs that business analytics encompasses the effective usage of quantitative tools, techniques and personnel in order to reduce cost, gain market share, improve production, etc. “It is a structured method adopted by organisations to make more profit,” says Venkateshan.
The key consumer of analytics is the business user, a person whose job is not directly related to analytics per-se (eg a merchandiser, marketer, salesperson), but who typically must use analytical tools to improve the results of a business process.Business analytics can be applied to all key areas of a business including financial management, customer relationship management, consumer behaviour, supply chain, marketing, etc. Kamlesh Sajnani, managing director, IMS Learning Resources Private Ltd, an MBA coaching centre, says, “Business analytics makes extensive use of data, statistical and quantitative analysis, explanatory and predictive modelling and fact-based management to drive decision-making. Analytics can answer key questions like why is this happening, what if these trends continue, what will happen next (predict), what is the best that can happen (optimise).”
In large organisations, analytics has replaced intuition as the best way to answer questions about what markets to pursue, how to project price offerings and how to identify areas wherein operations can be made more efficient in response to cost and environmental constraints. “To do this, companies are using effective toolsets, governance and management practices. They are setting up centres of competence where their best and brightest analytics teams constantly innovate around a single view of the business,” elaborates Sajnani. Kumar adds, “In finance, we see people look at past and present performance of stocks to decide on how and where to invest. In telecom, companies are finding out consumers’ usage patterns to decide the most attractive tariffs. In retail, the purchase patterns among various income groups are being analysed to be able to target products better, among other things.”
Depending on the field of choice and nature of analysis, a business analyst can be paid anywhere between Rs 3 lakhs and Rs 10 lakhs per annum.
Nitin Godawat, chief operating officer, DeciDyn Systems, a Bangalore based business analytics company, believes that the field is still at its nascent stage in Indian corporations and most analytics companies in India offer services for several USbased companies. “However, large corporates like ICICI, HDFC, Vo d a fo n e, Re l i a n c e Re t a i l , among others, have now set up in-house analytics team and several other organisations are realising the need to have analysts in the company,” he says.
As of now, there are over 5,000 professionals in this field in India. With the country supplying business analytics capabilities to huge MNCs, the scope for a professional in this field is phenomenal.
A degree in statistics and mathematics followed by an MBA is an ideal qualification for aspiring business analysts. Although there are no fulltime programmes in business analytics, it is being integrated into the MBA curriculum across several B-schools. At the Indian Institute of Managements (IIM) and several other Bschools, business data analysis and business intelligence is interspersed in the Post Graduate Programme in Management (PGPM) curriculum. IIM Ahmedabad has statistics, decision making and operations management as part of its PGPM course. That apart, advanced statistics and data analysis are part of its management development programme. IIM Kozhikode offers a certificate programme. Asim K Pal, professor, management information system, IIM Calcutta says, “Data collection, data mining and data warehousing are important business functions. Analysing this data through several business intelligence softwares to find out the patterns in data is another vital task. Keeping this in mind, we have introduced subjects like business intelligence tools and techniques and business data mining and marketing data analysis for our postgraduate diploma programmes. We also have a course in data analysis and intelligent business for our executive management programme.” Many B-schools train their students in SAS and SPSS (leading softwares in statistics and analytics) as part of their curriculum. The MBA programme in NIT Trichy has eight electives in business analytics.
Byju Ravindran, a CAT trainer says, “Since business analytics is integral to every industry, it cannot be taught in isolation. Few institutions such as International Institute of Business Analysis and International Institute of Learning, both in the US, provide certificate programmes in business analytics for both freshers and working professionals.”