Data can be defined as a collection of information, used to derive useful insights for informed decision making. Right from analyzing traffic patterns on a small business website to determining strategies for conversion optimization, to more complex industrial algorithms that determine how much laundry detergent a big box retailer should deliver to an individual location; data is playing a vital role in determining B2C or B2B insights and thereby formulating business strategies. The usage of data is becoming more and more mainstream in today’s world.
More than 90 percent of the data that exists today has been created since 2011 — and thanks to our technologically driven society. Billions of bytes of new data are created every day. But what do we do with all of that data?
Without interpretation or context, it’s all but useless. Without knowing what to pay attention to, and what it all means in the larger scheme of things, big data is nothing more than a big pile of information.
That’s where ‘Business Analyst’ comes in. Business Analyst helps in making sense out of raw data.
Why do companies require Business Analysts?
Back in 2012, the Harvard Business Review called the position of data scientist the “sexiest” job of the century. That description stemmed from the fact that in the latter half of the first decade of the oughts, the notion of big data was only beginning to gain notice. Online businesses, especially social media companies, were collecting reams of data about their users, but weren’t sure how to use it to their advantage.
Analysts began asking questions, looking for patterns, interpreting data, and developing insights that could be used to grow their businesses. Based on the success of companies like LinkedIn, which relied heavily on analytics to develop the features that attracted millions of new users (and subsequent revenue growth) other companies began looking to scientists who could make sense of their data, and more importantly, show them how to use it.
The HBR called the job of data scientist — which has since morphed into business analyst in many cases — sexy, and the employment picture agrees. According to the U.S. Bureau of Labor Statistics, demand for business analysts is expected to increase by 25 percent by 2020. In short, everybody wants one — but not everyone can get one.
According to a report on big data from research firm McKinsey & Company, there could be a shortage of nearly 200,000 analysts who have the in-depth skills necessary to interpret big data by 2018. Perhaps even more alarming is the same report predicts a shortage of 1.5 million managers or analysts who know how to actually use the insights gathered from big data to make effective decisions.
What does it take to become a Business Analyst?
The Bureau of Labor Statistics notes that most business analysts have a degree in a computer or technology-related field with additional training in business. However, the most successful candidates have a master’s degree, which combines their deep knowledge of the computer systems required for gathering and interpreting data with the business expertise necessary for applying it.
Colleges and universities across the country are meeting the demand for this specialized knowledge with comprehensive programs that focus on gathering, analyzing and prioritizing business and system data and requirements, and preparing students for work in this field.
Some claim, though, that the focus on big data is “just a fad,” and investing time and energy into business analyst education will prove unnecessary. However, the facts suggest otherwise, and there are more than a few reasons that a business analysis degree is a good investment:
- Job Prospects. Not only are qualified business analysts in high demand, the starting salary for these positions is competitive. The BLS reports that the median annual wage for an analyst is about $79,000; starting salaries tend to run in the low $50,000 range.
- Transferrable Skills. Skills in business analytics are not generally industry specific. Business analysts are in demand across verticals. Some experts consider this applicability across industries to be a boon to innovation; analysts can bring their insights and ideas from seemingly disparate industries together to create new, exciting, and unique products.
- New Tools and Techniques. Statistical tool companies, like SAS, SPSS, R, Python etc are constantly developing new tools and technologies for gathering and interpreting data. However, most of these tools are only as good as the people using them, creating a high demand for seasoned professionals.
- Data Isn’t Decreasing. The fact is, big data is here to stay, and it’s only going to get bigger. Thanks to cloud computing, social media, security concerns, the Internet of Things, and several other trends, the amount of data that needs interpretation and application will only grow. The people who know how to extract the important stuff from that data are the ones who will be in demand.
Clearly, then, earning a degree in business analytics is a solid investment in your career. Developing not only the technical skills for data collection and analysis, but knowing how to think about the data and interpret it correctly will prove valuable going forward.
In this article, we discussed about the importance on business analytics in an enormously populated world of data. We also looked at how business analysts are best at playing with data, thus helping businesses globally to make informed decision making. This article also discusses the job demand of business analyst in the near future.