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Differentiating between business intelligence and business analytics
By JESSICA ADISON 610 views
BUSINESS

Guide to Understanding Business Intelligence and Analytics

You may have come across the terms Business Intelligence and Business Analytics. Both these terms are often used interchangeably, which can cause further confusion. These terms are closely related as both practices make use of the data and have their differences when it comes to how that data is utilized.

The reason why a lot of businesses are incorporating these practices is that making use of the data can help get a clearer vision for the future and understand what happened in the past. For example, Content moderation services can understand the patterns usually their clients follow and optimize their processes. Similarly, eCommerce businesses can forecast their inventory needs.

In this blog, you can check out the basic definitions and differences between both business analytics and business intelligence.

Business intelligence is a broad term that covers other processes like data analytics and business analytics as well. By definition, business analytics is the process of collecting, storing, and analyzing data generated from a company’s activities. This data is given an easy-to-understand form to show trends, performance metrics, and a company’s current position.

BI uses descriptive analysis of past and present data. This data is displayed through graphs to show you current and past trends. That data may be used to analyze a company’s past performance for better decision-making and understanding of current standings.

Different processes involved in business intelligence are completed using different types of tools. Those tools assist in filtering tons of data and transforming it into insights. So, in simpler terms, business intelligence shows you past and current data to analyze performance in different departments.

What Is Business Analytics?

To understand business analytics, it is best to grasp the concept of analytics and then relate it to business. Originally, analytics is the use of past and present data to predict future outcomes. Apply the same thing to business and you have business analytics.

Predictions for the future are created based on data from the past and present. The involved processes make use of bulk data and then use machine learning tools to predict outcomes. With machine learning, the more detailed your data is, the more precise the output becomes. Therefore, the collection of data and feeding it to the tools is an important part of the whole process.

The predictive analysis in BA (business analytics) takes a detailed and logical approach to foretelling. Utilizing different AI technologies, business analysts can forecast what results of the decisions made in the present are going to affect the company. That’s how this future-oriented analysis serves different businesses in their decision-making.

Business Intelligence vs Business Analytics

From the above definitions, you may have understood to some extent how these two processes are different. Where business intelligence focuses on the events of the past and present, business analytics predicts future outcomes. That’s one key area where both these practices differ from each other.

But that’s not it. With business intelligence, the collected raw data is first refined to use. That data is later fed to a visualizing tool like Microsoft BI to identify trends. These insights may be used for future decisions too because what’s the whole point of analyzing data if it is not going to be used in the future? So, the practices are not completely focused on the past and present alone.

Comparison of BI (Business Intelligence) and BA (Business Analytics)

Though business analytics is often regarded as a part of BI, accurate future predictions from scientists require the use of mathematical practices and understanding algorithms. Different future events are visualized using simulations and quantitative analysis. It is because visualizing existing data is easier than making future predictions using data.

What’s More Commonly Used by Businesses?

One cannot discount the importance of BI or BA. Both have their due importance. However, the usage of practices is different. Usually, executives and decision-makers use business intelligence to show reports of performance. Also, making use of BI is easier and does not require expert knowledge of complex mathematical practices.

On the other hand, business analytics requires the expertise of data scientists to have accurate insights. So, generally, only a limited number of people in an organization make use of business analytics practices. It is because of the ease of applying BI practices to the data.

However, the goal of both practices is to help report current performance and make better decisions for the future. So, there should be no argument about what’s more important. Understanding what happened in the past, and current position, and focusing on future scenarios are crucial for better decisions. Most of the people who search for or ask for a comparison of BI (Business Intelligence) and BA (Business Analytics) below have some related questions.

Frequently Ask Questions:

What Is the Difference Between Business Intelligence vs Business Analytics?

Differentiating between business intelligence and business analytics can be quite confusing. But here you can check out an easy explanation of both.