Business analytics have been around for a while. But in recent years, they have grown to be an even more important part of business success. As such, the need for analytics-driven talent has drastically increased.
We’ll take a look at what makes this industry so hot right now and why it is still on the rise, despite the uncertain economy and disruptive technologies like AI.
Specifically, we’ll answer the question, “Hip or Hype?” with:
Analytics has been around for a while, but the past few years have seen some rapid and significant growth. Of course, this industry continues to face challenges, including the uncertain state of the economy, disruptive technologies like AI and social media marketing, and backlash against big data. As such, does analytics have staying power in the face of these challenges? Should analysts be concerned that things might get worse before they get better? If you are an analyst wanting to take on a new challenge or career step, there are many options available today. In fact, we are predicting more opportunities than the market can hold.
Background on the Business Analytics Field:
Business analytics has been all over the news lately. And for good reason- it’s fascinating. For example, there is a lot of hype about big data that is completely missing the point. Big data as a buzzword has become synonymous with “data” or “sensors”. The truth is that only 5% of data is actually labeled and usable to an analyst in its raw form. Unlabeled data- aka “dark” or “dirty” data – is practically worthless to an organization because it cannot be easily managed and analyzed (1). But what is data if it isn’t big?
Business analytics can be defined as the use of statistical and mathematical modeling, and the review of business processes to develop insights (2). In layman’s terms, this means that analysts look at data collected across various entities in an organization to determine how they can impact one another. For example, a company may want to know whether a price change on one product affects sales of another. Another type of analysis may look at how social media interaction affects sales. This kind of analysis is complex and requires significant skill in order to begin identifying models that accurately represent the true nature of business relationships. Sounds pretty overwhelming- which is why you need a professional.
On the other hand, “Hype”.
The term ‘Analytics’ is becoming much more broadly recognized in business today. No doubt this is because of the demand for data gurus with deep expertise in analytics. Because of this increasing demand, the role is becoming increasingly commoditized. And what happens when a talent market becomes too competitive? The market starts to adjust to meet the increased demand. In other words, salaries suffer- and they have been steadily falling over the past few years. Another problem is that many technology providers like SAP and SAS have introduced products that address business analytics needs without having to invest in high-skilled individuals. As a result, the market is both over-saturated and lacking in talent.
In addition, the demand for business analytics talent will continue to rise as more data and technology become available. In fact, we are predicting that by 2020 the shortage of skilled analysts will cause average salaries to decline by more than 18%. As such, if you are interested in being an analyst, you should consider a career change or start your own company.
Is Analytics a ‘Hip’ or ‘Hype’ Field?
Analytics is a “hip” field because it has become part of popular culture. You may already be familiar with some concepts such as “data-mining” or “business intelligence”. If not, you are likely to encounter them soon. As such, it is important to learn these concepts and understand them as business concepts.
Furthermore, there has been an explosion in startups that make analytics accessible to anyone. One of these companies is SumAll. They have created a service that analyzes social media data alongside business metrics in order to create trend reports for business leaders. This kind of service allows any user the ability to set up a basic analytics software with just a few clicks, provided they have access to their Twitter or Facebook account.