Running head: DATA ANALYTICS IN BUSINESS 1

Data Analytics in Business

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Data Analytics in Business

Data analytics involves the extraction of raw data and categorization to analyze and

determine behavioral data and patterns-based n the requirements of an organization. Thus, data

analytics offer insights and help in drawing conclusions from raw information sources. In

business, data analytics have emerged as an essential tool in determining and enhancing

productivity and business gain. In manufacturing, data analytics support production by pointing

out possible bottlenecks in production (Gandomi, 2015). However, the data analytics have

evolved to other sections of business operations, i.e. content companies use data analytics to

ensure targeted advertising in online advertisements. Also, gaming companies use data analytics

to rank and keep the majority of active players in the game. There are different types of data

analytics, i.e., descriptive analytics, which analyses data over a particular period, predictive

analytics; which makes assumptions on possible future happenings, and prescriptive analytics;

that suggests courses of action by moving into the territory.

Data Analytics and Competitive Advantage

In the current market settings, customer expectation has increased tremendously leading

to increased competition in the business industry. Consequently, the amount of available data in

all areas of business has been on the rise (Chiang, 2018). As a result, data analytics have become

essential tools in determining business trends. For instance;

Data analytics helps in cost savings. Using the data analytical tools business can decipher

the raw data and determine the exact areas of inefficiency helping the company to plan better in

the future and reducing the risk of misuse of resources. Reduced cost of operations in business

leads to increased competitive advantage.

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Also, business analytics leads increased marketing and customer reach. Data analytics

through online surveys has helped companies to understand their customers better. Data analysis

of customer responses, i.e. through social media and other online platforms have helped

companies to understand customer needs as well as lead to niche target marketing. Companies

such as Netflix and Spotify utilize online information through customer clicks, to specifically

target each customer based on specific interests.

Opportunities for Using Data Analytics in E-Commerce

E-commerce is one of the technological environments that impact business operations.

There are various opportunities for using data analytics. For example; implementation of big data

strategies offers businesses a better opportunity to better understand customer experiences and

consequently higher returns for the businesses (Akter, 2016). The increased use of mobile phones

offers an opportunity for business brands to use big data analysis in and analyze customers

through mobile technologies. For instance; Google offers the opportunity to internet sites that

can be assessed through mobile technology.

Also, business analytics of big data offers an opportunity into the increasing online

payments. Analysis of big data offers an opportunity for more accessible and more secure forms

of payment, i.e. through the integration of different functions of payment functions to determine

fraud cases in real time as well as detecting cases of money laundering in real time.

Effective Management of Data Analytics

Effective management of data analytics helps business organizations to build a

competitive landscape as well as a better analysis of their customers. There are various issues to

consider to manage data analytics resources, processes, and systems effectively. i.e.
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Securing Data

The process of collecting data for analysis is tedious and expensive. Since data analytics

depend on analysis of raw data, there is a need to secure the raw data collected (Kwon, 2014).

Raw data is an analytic resource which should both be accessible and secure for analysis. Loss of

data may lead to loss of client trust as well as losses to the business.

Interlinking Data

Raw data collected for a specific business is often used in various areas within the

business. Thus, to effectively manage the data analytics, the database needs to be interlinked for

ease of use by different sections and to get the desired solutions.

Data protection

Data protection is one of the essential aspects of effective data management. Threats to

organizational data keep growing each time, and better data protection will ensure better

positioning of the business in the market through increased competitive advantage. Data

protection ranges from protection from intruders, data corruption, and environmental situations

that may potentially damage analytics data.

Application of Database Systems and Data Mining Within E-Commerce

Database systems consist of a collection of organized information for easy access and

management. Data mining, on the other hand, refers to the process used in the analysis of raw

data to clear and meaningful information (Kambatla, 2014). In e-commerce, various databases

are used, i.e. cloud databases, redundant database backed powered by PostgreSQL among other

are used. Databases in e-commerce are applied either as site content or through transaction data.
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The site data generates the site pages while the transaction data is used as a result of client action

on the site. Data mining, on the other hand, helps in the determination of trade developments

trends and helps in decision making.

However, there are various challenges involved in the application of database systems in

e-commerce as well as data mining systems. For instance, it is challenging to translate business

questions into data. Similarly, the integration of data is a bit challenging in all sections of the

business.

Application of Big Data Analytics in E-Commerce

Big data analytics offer an exciting insight into the business environments. In the current

business trend, big data analytics are used to predict trends in business as well as in

understanding inventory. Big data analytics also help in the better understanding of customer

behavior and customer experience.

Big data analytics require statistical analytics to decipher raw data into meaningful

information. Such predictive analytics include risk analytics, decision management, text

analytics, among others. However, there are challenges in the application of big data analytics,

i.e., the challenges of data collection in e-commerce. Collection challenges include; sampling

during collection due to the high number of data samples; changing demographics such as

change off social class among others.

Security concerns associated with data analytics in the business organization

In the current business setting, the rate of data production in large businesses grows at a

rate of 40-60% per year. Thus, the storing of such significant information has led to various

security concerns, i.e.;

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Shortage of data analysis professionals: due to the voluminous amount of data being

produced each year, there is a need for the availability of data analysts in the market. However,

the increased shortage of professional analysts poses the security challenge of loss of data, as

well as theft and corruption of essential business data in an organization.

Data storage and quality: with the increasing levels of data production, there is an

increasing problem on secure data storage and quality processing of the data (Inukollu, 2014).

The traditional storage f big data in data lakes/data warehouses poses the problem of mixing

structured and unstructured data Leading to errors and duplication of information.

The Relevance of E-Commerce And M-Business in A Technological Business Environment

The effect of technology in business is growing faster every year, and e-commerce plays

an essential role in business. From online shopping to online tracking of one’s finances,

technology has become part of the modern business. In mobile business (M-business) for

instance, mobile apps have changed the way retailers engage with consumers, i.e. through

engagement.

The growing use of technology in e-commerce is relevant to retailers as it has helped in

developing personalized customer experiences. Advertising now is based on data analytics of

individual clients to address individual needs, i.e. per click targeted advertising.

Systems and Tools for Managing Data

In modern business environments, data is considered a business asset hence the need to

collect enough data as possible. Data management analysis involves various systems and tools,

i.e. Microsoft excel, probably the commonly available data analytic tool used today. The excel
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spreadsheet tool, however, is perfect in developing small analytical models (Alekseev, 2016).

Excel is essential in developing charts, pivoting tables, and other business trend functionalities.

However, big data analytics require big data analytics tools, i.e. Pentaho which addresses the

issues blocking accessibility and value of organizational data.

In conclusion, data analytics play an essential role in creating competitive advantage in

the current business environment. However, like any business functionality, data analytics

require effective management for effective utilization of its benefits in business. Effective

management of data includes protection of organization data, interlinking data for easy

accessibility as well as securing of data from possible corruption of theft. Use of data analytics in

business also has various challenges, i.e. concerns of lack of enough data analytic professionals

is a challenge affecting the increasing phenomena of data collection and analysis in business.
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References

Akter, S., & Wamba, S. F. (2016). Big data analytics in E-commerce: a systematic review and

agenda for future research. Electronic Markets, 26(2), 173-194.

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Alekseev, A. A., Osipova, V. V., Ivanov, M. A., Klimentov, A., Grigorieva, N. V., & Nalamwar,

H. S. (2016). Efficient data management tools for the heterogeneous big data warehouse.

Physics of Particles and Nuclei Letters, 13(5), 689-692.

Chiang, R. H. (2018). Special Issue: Strategic Value of Big Data and Business Analytics.

Gandomi, A., & Haider, M. (2015). Beyond the hype: Big data concepts, methods, and analytics.

International Journal of Information Management, 35(2), 137-144.

Inukollu, V. N. (2014). Security issues associated with big data in cloud computing.

International Journal of Network Security & Its Applications, 6(3), 45.

Kambatla, K. K. (2014). Trends in big data analytics. Journal of Parallel and Distributed

Computing, 74(7), 2561-2573.

Kwon, O., Lee, N., & Shin, B. (2014). Data quality management, data usage experience and

acquisition intention of big data analytics. International Journal of Information

Management, 34(3), 387-394.

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