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Business Analytics vs Predictive Analytics

By Priya PedamkarPriya Pedamkar

Business Analytics vs Predictive Analytics

Difference Between Business Analytics vs Predictive Analytics

In the modern world, the technology used in business processes can confuse a lot of people. Many technologies may seem to do the same job, but in reality, have very different functionalities depending on the way they are used. One example of this is the confusion between business analytics and predictive analytics. Even companies often confuse business analytics with predictive analytics or think that once they’re using business analytics for analysis of their data then they’re doing all they can to get data insights from it. Due to which they are not exploiting the full potential of data they have.

Predictive analytics and business analytics they seem to be same but believe me they are not, and if you’re just using your data for business analytics applications then you’re almost certainly not getting as much value from it as you could be. But how exactly does predictive analysis differ from business analytics? Let’s try to find the difference between Business Analytics and Predictive Analytics in this post.

What is Business Analytics?

Business Analytics helps different organizations in better decision-making leveraging a wide range of latest tools and methods. BA involves data analytics, data mining and big data processes and procedures which help in making better business decisions. With recent advancement in BA tools, users can generate reports and visualizations all by themselves, without relying on IT staff.

Where can we use Business Analytics?BA

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What is Predictive Analytics?

Predictive Analytics is a hot issue in today’s business and information technology world. Predictive analytics goes beyond these backward-facing views and uses the data you already hold in your business to look forward and tell you what’s going to happen in the future. Not only that. Predictive modeling allows you to predict the future outcome, it can also tell you what’s the next best thing that could happen in the future.  And good predictive analytics tools will automate this process for you so that your business decision making becomes fact-based and truly data-driven rather than based on subjective judgments and hunches.

Your business analytics tool can tell you which of your products is currently selling best, and show you trends in your product sales over time up to this point. But what if you want to know how well a particular product is going to sell in the future? Perhaps you’re planning an advertising campaign. What effect will this campaign have on future product sales? Which of your customers are most likely to respond to the campaign? This is what predictive analytics can tell you.

Where can we use Predictive Analytics?Predictive Analytics

How predictive analytics works?

The predictive analysis uses various models to analyze data. The most common is the predictive model algorithm that is focused on individual customer behavior. Using sample data with known attributes, the model is trained and is able to analyze the new data and determine its behavior. This information can be used to predict how the customer might behave next.

Head to Head Comparison Between Business Analytics and Predictive Analytics (Infographics)

Below is the Top 7 Comparison Between Business Analytics and Predictive Analytics:

Infographics

Key Difference Between Business Analytics and Predictive Analytics

Below is the difference between Business Analytics and Predictive Analytics are as follows:

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1. The role of traditional Business Analytics was to provide information to the users about past performance of their business operations and used mainly for reporting purposes.

Predictive Analytics uses forecasting techniques which help in addressing the complex issues of the business environment. It also uses advanced quantitative methods including descriptive and predictive data mining, simulations that can provide better business insights as compared to the traditional approaches used by Business Analytics.

2. Business Analytics relies on methods such as querying, reporting, dashboards and OLAP using a set of metrics with focus on past performance.

On the other hand, Predictive Analytics helps in predicting future events and helps in exploring patterns which may be more complex to detect.

3. With Business Analytics, the analysis is designed to be more repetitive based on reporting templates which extract specific information related to the business to assess historical performance.

Predictive Analytics comes up with a question first and then a set of analysis is performed to do a deep research using statistical and quantitative data along with algorithms to provide insights on the question.

Business Analytics and Predictive Analytics Comparison Table

The comparison table between Business Analytics and Predictive Analytics is mentioned below.

Basis For Comparison Business Analytics Predictive Analytics
Objective Business Analytics is about descriptive analytics or looking at what happened. Predictive analytics is about finding hidden patterns using complex mathematical algorithms that can be used to predict future outcomes.
Data With BA, raw data is processed into information regarding Product, Client, Region, Quarter for sales etc. With predictive analytics, however, raw data is processed into “cleaned data” for consumption by algorithms. The volume and complexity of the data are more than our grey matter can digest.
Insight With BA, people get insights to solve a business problem, which often includes some guesswork, assumption-making, and reliance on subjective experience. With predictive analytics, algorithms detect complex patterns and create a model that is the insight, powerfully illuminating logical pathways forward to address your key business concerns,
Decision With BA, people make decisions on what to do with their insight without strong, tangible evidence that they are correct. With predictive analytics, the model tells you the best decision to make based on the data presented
Data Types Structured data, traditional sources, and manageable data sets. Structured/Unstructured data, Internal/External data, massive data sets.
Technologies Standard and ad-hoc reporting, dashboards, alerts. Predictive modeling, forecasting, statistical analysis.
Common Questions What happened last quarter?

How many did we sell?

What is the optimal scenario for our business?

What will happen next? What if this trend continues? Why is this happening?

Conclusion

Predictive analytics takes the business analytics to the next level, moving from a retrospective set of answers based on historical data to a set of answers focused on future perspectives which helps in predicting performance and prescribing recommendations.

No matter what, you still need business analytics to know what happened in the past, but you also need predictive analytics to know what you can do in future.

Recommended Articles

This has been a guide to Business Analytics vs Predictive Analytics. Here we have discussed Business Analytics vs Predictive Analytics head to head comparison, key difference along with infographics and comparison table. You may also look at the following articles to learn more –

  1. 13 Most Useful Predictive Analytics Tool (Helpful)
  2. Business Analytics vs Business Intelligence
  3. 9 Important Blogging Insights Your Analytics Can Tell You
  4. 13 Best Tools for Predictive Analytics
  5. Predictive Analysis and Forecasting
  6. Predictive Analytics vs Data Science
  7. Business Intelligence vs Data Warehouse
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