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Elements of Business Analytics

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Syndicated from IIA

My friends at SAS, a sponsor of IIA, have a nice piece on their Knowledge Exchange – Elements of a Business Analytics Framework for IT. This lays out their view on the different kinds of decision types and maps them to decision frequency. Both in Smart (Enough) Systems and in my blog posts (like this one on the need to focus explicitly on decisions), I have discussed the division of decisions into Strategic, one-off decisions, Tactical management decisions and Operational, transactional decisions. SAS’ model calls the Strategic decisions Transformational ones (which I like) and talks about Ad-hoc and Exploration based Tactical decisions while calling Operational decisions “Managed”, also a good phrase.

Clearly most BI implementations start by supporting the Ad-hoc/Tactical decisions. As the article says you need to apply analytics more broadly than this – moving beyond supporting decisions with classic BI features. You need both to support exploration and ultimately transformation (moving up to more Strategic decisions) and driving down to push analytics into your automated systems. My focus is largely on these operational decisions and I strongly believe that companies need to make operational decision making a corporate asset. This means being more systematic about how analytics are applied in these automated, managed, operational decisions.

Obviously this requires a different kind of analytics – it means being able to turn descriptive analytics and data mining into business rules so they can be executed (you can check out this webinar recording for more on how rules can be a platform for analytics) and it means being able to build executable, predictive models than can be embedded either in the system or the database. It also means understanding how your Strategic decisions impact these Operational decisions – the loop back from Transformational decisions to the operational environment shown in the diagram.

The bottom line is that there is more to analytics than just BI (as I discuss in this webinar on decision analytics is broader than just BI and web analytics).

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