Demystifying Data Analytics
Despite the exponential growth in the use of data analytics across society over the last five years, there often remains an air of mystique about exactly what it is, how it can be used and what value it creates. It is critical that we continue to educate and inform organisations of all shapes and sizes about the benefits that data analytics and business intelligence can offer.
Data analytics and business intelligence are the tools with which we harness the power of data and create value from it. In many ways data is like any other raw material, it has no value in its raw form, but once processed and refined it can have immense value. So data analytics and business intelligence is the process of harnessing the power of data and creating value from it. The “value” created from the data is in the form of answers to key questions and unique insights about a particular area of focus.
The data in each business system reflects many things about an organisation:
1. The culture and management style
2. The strength of internal controls and compliance
3. System effectiveness and design strengths and weaknesses
4. User skill, competence and training needs
5. Process issues, bottlenecks and failure points
The value of data analytics arises from the unique insights available from the capability to:
1. See the big picture and the devil in the detail simultaneously for a given issue or area of focus
2. Seamlessly integrate data from totally different source systems to understand hidden relationships, patterns, correlations and dependencies across the full spectrum of an organisation
Data Analytics can be used in a variety of contexts and for a variety of purposes. The most popular amongst our clients include:
- Strategic Analytics – use the data to identify and explain the key strategic value drivers, relationships and emerging trends to improve operational efficiencies and drive future financial performance.
- Diagnostic Analytics - like a blood test, DNA test and full physical assessment all in one. Test what is really going on in the organisation in all the different dimensions to identify issues and opportunities.
- Investigative Analytics – use the data to gather evidence of the events and behaviours and identify root cases and compliance breaches.
- Surveillance Analytics – using the data to observe behaviours and activities by customers or employees and evaluate compliance with key laws, regulations, organisational policies and procedures.
- Assurance Analytics – test key parameters and relationships to provide assurance in regard to the accuracy, completeness and validity of outputs across the organisation.
How is data analytics different to existing analysis tools and methods?
- Traditional methods of analysis have had to summarise large amounts of data in order to cope with it. This summarisation (primarily aggregation on one dimension) washes away much of the richness and texture of the data which exists at the individual record level. Most often the output of traditional analysis is a report which summarises the data on just one single dimension.
- Data analytics allows you to see the full personality, richness, character and texture of the data, so its deeply hidden secrets can be observed and used. It enables the assessment of many relevant dimensions simultaneously so that a complete understanding of the subject can be obtained easily.
- Data analytics:
- captures the full population of transaction and static data (no aggregation)
- can quickly identify key patterns, relationships and anomalies across an entire dataset
- can pull additional relevant data together from a range of sources and seamlessly integrate it to allow more powerful multi-dimensional relationships to be identified
- can capture and process very large amounts of data meaning data size is no constraint
- draws heavily on large amounts of research about how the human brain best interprets information and allows the presentation of insights in a manner best suited to efficient understanding
There is no limit to where and how data analytics can be used to add value to an organisation. Some of the most frequent areas include organisations which:
- are looking to optimise their operations or understand their customers or employees’ behaviours in order to enhance experiences and improve business performance;
- have a high proportion of revenues received in cash (like cafes, pubs, clubs, chemists);
- are member-based or those with customer rewards/loyalty programs (gyms, health clubs, online businesses, Registered Clubs);
- have a significant number of people or assets to manage and optimise;
- are implementing new systems or undertaking system upgrades;
- are franchisor or multisite operations looking for an efficient and non-intrusive method to ensure compliance across the network;
- have large transaction volumes and multiple different legacy systems and require assurance that there are no compliance or value-leakage issues;
- key decision-makers sense that there is a problem in an area of the business, but can’t get to the facts to understand what is really going on;
- have sales incentive programs in place and need to understand how it influences employee behaviours and business performance;
- are undertaking strategic planning and seeking the key strategic insights required to succeed;
- have staff spending significant time creating and fixing Excel spreadsheets for business analysis and reporting.
PKF Business Intelligence and Analytics provides the full suite of Business Intelligence and Data Analytics services to our clients, regardless of size, industry or location. From our tailored strategic insights service to our efficient and non-intrusive streamlined assurance and compliance service, we have the tools, methodology and experience to create real value from almost any data.
Contact Vaughn Campbell today on [email protected] or 0414 978 612 to find out how Data Analytics can work in your business.