What is advanced analytics compared to business intelligence?
Analytics is an immense field with many subfields, so it can be difficult to sort out all the buzzwords around it.
We know that analytics refers to the skills, technologies, applications and practices for continuous iterative exploration and investigation of data to gain insight and drive business planning. Analytics consists of two major areas: Business Intelligence and Advanced Analytics.
What is often overlooked is how advanced analytics differs from BI based on the questions they answer:
Business Intelligence – traditionally focuses on using a consistent set of metrics to measure past performance and guide business planning. Business Intelligence consists of querying, reporting, OLAP (online analytical processing), and can answer questions including “what happened,” “how many,” and “how often.”
Advanced Analytics – goes beyond Business Intelligence by using sophisticated modeling techniques to predict future events or discover patterns which cannot be detected otherwise. Advanced Analytics can answer questions including “why is this happening,” “what if these trends continue,” “what will happen next” (prediction), “what is the best that can happen” (optimization).
Advanced Analytics vs BI
Where Business Intelligence is focused on reporting and querying, Advanced Analytics is about optimizing, correlating, and predicting the next best action or the next most likely action.
Advanced Analytics & Business Intelligence Comparison Table
Why is advanced analytics important?
While many companies already use and operationalize business intelligence applications within their business processes to leverage their data assets, the true potential of data is still untouched in many organizations. Advanced analytics, particularly predictive analytics, can help reveal the future and optimize operations.