Business understanding is the starting point for data analysis. It involves grasping what a business needs to solve problems using data or other technologies. By beginning to analyze business data, you can not only identify solutions but also gain a holistic view of the business and adapt tools to future technological advancements.
Steps for conducting Business Understanding
The main steps in Business Understanding involve identifying existing business problems, analyzing those problems into parts, and prioritizing solutions. This is typically divided into four areas:
1. Determine Business Objectives
To begin understanding how to use data to solve business problems, we must first examine our business and identify which areas need solutions using data or technology. We need to determine which areas data can address and which require other technologies. Start by asking the following questions:
1. What kind of results does the business need? (Reports, dashboards, strategic recommendations, etc.)
2. What factors are relevant to the business goals?
3. What personnel/people with data analytics skills
Asking these questions provides a holistic view of the problem and a comprehensive approach to solving it, encompassing data utilization, desired results, and relevant factors.
2. Assess the situation
Assessing the organization's situation from various factors is part of what provides an overview of the organization, including its structure, available resources, and limitations. This allows for the design of a structure that can help solve problems within the available resources. A SWOT analysis should be conducted to identify the business's strengths and weaknesses and how to address each of those strengths and weaknesses. For example:
- If the project cost is assessed to be low, one might choose to use cheaper tools that can provide the necessary functions
- If it is assessed that the business has the resources to use expensive, high-performance tools and that they can help the organization generate profits, then further development can be done immediately
3. Establish guidelines for data analysis
After understanding the business objectives and the situation, management considered whether the company's personnel possessed sufficient skills for data analysis. If not, would it be better to outsource the data analysis team? A clear data analysis approach must be defined to align with business objectives, and the data obtained must be used to answer the following questions:
- What are the desired outcomes? (A predictive model, a user-friendly dashboard, etc.)
- How can we measure the success of a project?
4. Prepare a project plan (Produce Project Plan)
After analyzing the data, aclear project plan is needed, starting with the following questions:
- How many months does the project last, and how many stages are there?
- What resources are required (personnel, budget, software, hardware, etc.)?
- What tools or technologies will be used?
summarize
Conducting Business Understanding is the starting point for evaluating and analyzing a business before applying various tools to solve problems. Furthermore, it allows for a review of the overall business performance to identify areas for improvement and development. Without a clear Business Understanding, other aspects of the business cannot proceed; it will fail to address business problems and find genuine solutions.
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