What is business analytics?
Business analytics is a growing science that’s rising to meet the demands of data-driven decision making within enterprises. Ideally, IT data can inform business-side decisions, but there’s a challenge.
The charter of IT is to provide application services to business units that help them achieve their goals. To measure service quality, IT teams monitor infrastructure, applications, and user experience metrics, which in turn often support service level objectives (SLOs). But these metrics and SLOs are only indirectly connected to business KPIs, which often leads to misplaced priorities, ineffective collaboration, and lost business opportunities.
By connecting business metrics to IT metrics, IT gains a direct view into how IT service quality influences business outcomes using the tracking goals that matter most to business teams. IT and business leaders can then collaborate effectively and make joint decisions informed by shared priorities.
But what is business analytics exactly, and how can you feed it with reliable data that ties IT metrics to business outcomes? Let’s start from the top.
What is business analytics?
Business analytics is the process of applying statistical analysis to historical data to gain new insight and improve strategic decision making. Business analytics solutions derive insights from disparate data, uncovering hidden patterns and relationships. They help you to see what is happening, to predict what might happen, and to understand why.
Why business analytics matter
Traditionally, the realm of business analysts and IT data scientists didn’t easily intersect. But advancements in monitoring platforms are giving IT teams an important seat at the business analytics table. Embracing business metrics allows monitoring professionals to measure the impact of IT service quality on business outcomes. Business metrics can help inform troubleshooting, optimization, and decision making with the speed and context lacking in traditional tools. Business analytics relies on business observability, a natural evolution of how we think of full-stack observability. It acknowledges that IT’s raison d’etre is to support business goals, and that a full understanding of IT service quality requires visibility into business outcomes.
Ultimately, business analytics leads to faster, more confident decisions aligned to common goals as measured by business KPIs. Whether responding to unexpected events, optimizing the customer experience, or improving the efficiency of complex business processes, a real-time view of business KPIs give IT professionals the insights they need to prioritize actions that will have the biggest business impact.
Business analytics benefits for IT
By connecting the IT function with a full view of business analytics and metrics, organizations can accomplish the following:
- Prioritize issues in alignment with business goals
Knowing when and why poor digital experience impacts business outcomes – or knowing where you should optimize to improve business outcomes – helps IT focus resources where they matter most. By focusing on business-impacting issues first, teams don’t waste time fixing less-impactful background issues that can wait. Being able to clearly prioritize issues enhances agility and enables IT teams to optimize and innovate.
- Improved customer experience
When IT views service quality through the lens of business outcomes, there’s increased emphasis on the benefits of good customer experience. After all, business is increasingly conducted online where customer experience is dominated by digital experience. Monitoring metrics with an end-to-end customer-centric perspective is the key to ensuring that customer expectations are met. It’s through this outcome-oriented perspective that IT can move beyond digital experience to include customer experience, aligning with business goals to better meet customer expectations.
- Improved collaboration
When it comes to connecting what could be known as the last great silo – or the gap between business teams and IT operations, business analytics enable collaboration by introducing a shared view of success.
How does business analytics work?
Business analytics begins with choosing the business KPIs or tracking goals you need for a specific use case, then determining where you can capture the supporting metrics.
Business KPIs often rely on important context to make them more actionable. For example, a count of ecommerce conversions is an important business metric but tells an incomplete business story. It’s likely the business KPI includes additional context such as cart value, popular or out-of-stock products, fulfillment metrics, audience segments, and promotional sources. Knowing these details in the context of the transaction helps to drive better decisions.
A business analytics solution should allow you to capture data from four sources:
- Real user sessions. This is where most customer-centric data is available, mapping closely to web analytics and similar marketing tools. You can usually capture conversions and abandons here.
- Traces. Important business metrics may be available by monitoring backend services. Credit card payments through payment gateways is just one example.
- Logs. Applications may write important business metrics to log files. You might find order fulfillment progress here.
- External systems. You may want to ingest data from ERP, CRM, or other business tools your organization uses. Customer feedback from Voice of the Customer (VoC) solutions is a good example.
Business analytics with Dynatrace
When IT and business teams can leverage the right data to combine efforts towards common goals, better decisions can be made. This helps make misplaced priorities, ineffective collaboration, and lost business opportunities a thing of the past. With the right business analytics tools in place, IT and business professionals alike can clearly leverage the insights they need to prioritize actions that will have the biggest business impact. As a result, IT and business leaders can work together effectively to make joint decisions, enhance agility, and better enable IT teams to optimize and innovate.
Learn more about how Dynatrace Business Analytics makes it easy to capture business KPIs and connect these to IT metrics.