What is Business Analytics? Definition, Examples & Types


Business analytics (BA) is a group of technologies and disciplines that solve business problems using statistical models, data analysis, and other quantitative methods. It comprises a systematic, iterative exploration of an organization’s data with importance on statistical analysis, to drive decision-making.

Data-driven organizations consider data as a business asset and look at turning that data into a competitive advantage. Success with BA depends on skilled analysts who can comprehend advanced technologies and the business, data quality, and a pledge to use data to get insights that inform business decisions.

How Business Analytics works

Before any data analysis occurs, BA starts with numerous foundational processes:

  • Analyze the business objective of the analysis.
  • Choose an analysis methodology.
  • Scout business data that can offer support to the analysis.
  • Clean and then integrate data into one repository, such as a data mart or warehouse.

A small sample data set is generally considered for the initial analysis.

Business Analytics vs. Business Intelligence

Organizations start with Business Intelligence (BI) before implementing BA. BI analyzes business operations to understand the practices that have worked and where opportunities for improvement are. BI uses descriptive analytics. In contrast, BA focuses on predictive analytics, creating insights for decision-makers.

Business Analytics vs. Data Analytics

Data analytics is the study of data sets to make conclusions about their information and it does not help with business goals or insights. BA uses data analytics tools to gain business insights. Robotics is changing data analytics by offering improved efficiency. By automating the analysis of data, one can get business insights faster.

Business Analytics vs. Data Science

Decision-making is what data science helps with. Data scientists explore data using advanced statistical approaches and allow the features in the data to guide their analysis. However, it aims to solve a specific question or problem.

What are the Types of BA

Following are the types of BA :

  • Descriptive Analytics

    Descriptive analytics enables a business to learn from its previous behavior and how that behavior may impact the future. It provides data that helps to understand the overall performance of a company. Multiple stakeholders need to understand the raw data available. Descriptive analytics tracks the key performance indicators (KPIs) to understand the company’s performance.

  • Predictive Analytics
  • Predictive analytics uses the data collated and diagnostic and descriptive analytics results to announce what is expected to happen in the future on a granular level. The predictions are made by analyzing the past data, identifying patterns and casual relationships in the data, and then generalizing them for the future.
  • Prescriptive Analytics

    After predictive analytics, prescriptive analysis is the next step that enables future decision-making. Predictive analytics essentially informs the business on how and what needs to be done. Using simulation and optimization, it suggests probable outcomes and recommends actions that can increase the key business metrics. The focus here is on how to make it happen.

  • Cognitive Analytics:

    This is the most common type that applies human intelligence to specific tasks by combining multiple technologies, such as semantics, AI, Machine Learning (ML), and deep learning. The objective is to comprehend how a human brain makes decisions.


The analytics spectrum includes different types of BA that enable a business to understand and learn from its past patterns. Understanding when to employ the relevant form of analytics helps with the right business solutions and also provides the business with a competitive advantage.