What’s the Difference Between BA, BI and Plain-Ole Analytics?

Loraine Lawson
Slide Show

Six Big Business Intelligence Mistakes

I’ve always felt a little fuzzy about the difference between analytics, business intelligence and business analytics.

It seems there’s good reason for that: You’ll discover quite a bit of variance in how they’re defined, as a recent InformIT post shows.

The piece is actually a chapter from “Business Analytics Principles, Concepts and Applications: What, Why and How,” by Marc J. Schniederjans, Dara G. Schniederjans and Christopher M. Starkey. The chapter sets out definitions for each of these terms, starting with the more general term, analytics.


In short, analytics is an umbrella term for any of the approaches you might use (e.g., data mining, statistical techniques, research methodologies) to explore, visualize, discover or communicate any trends or patterns in the data. The term analytics isn’t a business term per se, but is used across disciplines. Your weatherman probably runs a lot of analytics to give you a two-minute forecast.

Analytics can be:

  • Descriptive, which is like a chart or graph that shows you what’s in the data set.
  • Predictive, which identifies trends and relationships that aren’t easily seen just by graphing the data. You’ve probably noticed a lot of buzz right now about using predictive analytics with Big Data.
  • Prescriptive, which combines data analysis with management and decision science to help you figure out how to use resources, such as your marketing budget.

What, then, is business analytics? Business analytics brings together all three types of analytics in combination to (hopefully) illuminate better leadership decisions. It’s what businesses hope will turn data into strategic advantages. If that sounds like marketing mumbo jumbo, here’s the more academic definition:

“…business analytics (BA) can be defined as a process beginning with business-related data collection and consisting of sequential application of descriptive, predictive, and prescriptive major analytic components, the outcome of which supports and demonstrates business decision-making and organizational performance.”

Like I said, it combines all three types of analytics to help you make better decisions.

That brings us to business intelligence (BI), which is probably what most people are familiar with in terms of tooling. You may think of BI in terms of querying and reporting. Actually, BI is the broadest of the terms, since it incorporates analytics, business analytics and, of course, information systems. The main difference is that BI incorporates storage, whereas neither analytics nor business analytics worry about where the data’s stored.

It’s easy to see why so many tech publications use these terms interchangeably, but if you’re talking with vendors or consultants, it’s helpful to understand where one begins and the other ends.



Add Comment      Leave a comment on this blog post
May 27, 2014 11:37 AM Karan Karan  says:
From a developer's perspective-I feel Business Intelligence facilitates better business analytics giving users a whole lot of reports, visualization tools and custom dashboards to help them make optimal business decisions. Reply
Jun 30, 2014 9:51 AM SusanO SusanO  says:
To say that true business analytics is necessary is an understatement, but understanding the difference between simple analysis and true business intelligence is imperative. The problem is that, even if you understand what you need to run your business, the task of manual business analysis always falls to the highly-paid analytical staff and, in the case of creating reports or compiling data to analyze, the task falls to critial IT staffers who have many other things to do with their time. At ElegantJ BI we believe that our clients should give critical consideration to building and sustaining a true BI environment lies in choosing a BI solution that is a) easy for all users, b) easily personalized and mobile for every user to get data in the office and on the road using customized views that allow them to work with data in a way that is meaningful to them, c) affordable yet sophisticated enough to perform forecasting, predictive analysis, impact and sensitivity analysis, estabish KPIs and alerts, and create simple, intuitive reports.http://goarticles.com/article/How-Can-a-Business-Intelligence-Tool-Engender-Employee-Collaboration-It-S-Easier-Than-You-Think/8964691/ Reply

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