Are you better suited to become a business analyst or a data analyst?
In smaller organizations, these job titles are sometimes used interchangeably to describe roles involving data or systems analysis. Larger organizations, however, typically employ both data analysts and business analysts to perform unique duties, making the differences between the two careers important to understand.
Here’s a look at what these roles entail and advice for deciding which career path is right for you.
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Both business analytics and data analytics involve working with and manipulating data, extracting insights from data, and using that information to enhance business performance. So, what are the fundamental differences between these two functions?
Business analytics focuses on the larger business implications of data and the actions that should result from them, such as whether a company should develop a new product line or prioritize one project over another. The term business analytics refers to a combination of skills, tools, and applications that allows businesses to measure and improve the effectiveness of core business functions such as marketing, customer service, sales, or IT.
Data analytics involves combing through massive datasets to reveal patterns and trends, draw conclusions about hypotheses, and support business decisions with data-based insights. Data analysis attempts to answer questions such as, “What is the influence of geography or seasonal factors on customer preferences?” or “What is the likelihood a customer will defect to a competitor?”. The practice of data analytics encompasses many diverse techniques and approaches and is also frequently referred to as data science, data mining, data modeling, or big data analytics.
A data analyst’s fundamental job is to tell compelling stories with data that empower organizational leaders to make better, more informed decisions.
The responsibilities of a data analyst often include:
To be effective in their roles, data analysts must possess the technical skills necessary for data mining, hygiene, and analysis, along with strong interpersonal skills to communicate their findings to decision-makers.
Some of the most essential skills for data analysts include data visualization and presentation skills, Microsoft Excel, Structured Query Language (SQL), and R or Python programming knowledge.
A bachelor’s degree in a related field is typically required for entry-level data analysts. For senior positions, hiring managers often require or strongly prefer a graduate degree such as a master’s degree in analytics.
Data analysts gather, clean, analyze, visualize, and present existing data to help inform business decisions. An effective data analyst uses data to answer a question and empower decision makers to plot the best course of action. Common tasks for a data analyst might include:
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Business analysts are responsible for using data to inform strategic business decisions.
A business analyst might also hold job titles such as operations research analyst, management analyst, or business data analyst.
The duties of a business analyst typically include:
Some of the primary skills needed to become a successful business analyst include critical thinking, problem-solving, communication, and process improvement. These professionals must have a firm understanding of their organization’s objectives and procedures so that they can analyze performance, identify inefficiencies, and propose and implement solutions.
Business analysts must have at least a working knowledge of the technology involved in analytics, though the need for hard technical skills is generally lower than for data analysts. For those looking for career advancement opportunities, however, developing an advanced knowledge of mathematics, computer science, and analytics can act as a significant differentiator in the job market.
Entry-level business analyst positions usually require a bachelor’s degree in business administration or a related area of study. As the need for professionals with expert data skills increases, though, advanced degrees like a master’s in analytics or a master’s in business analytics are becoming more popular among job applicants.
Business analysts help identify problems, opportunities, and solutions for their organizations. They do this by:
Business analysts and data analysts are two distinct roles that play important roles in the world of data-driven decision-making. Here's a comparison between business analyst and data analyst:
Overall, both business analysts and data analysts are essential to an organization's success. Business analysts help ensure that IT systems and products align with the goals and objectives of the business, while data analysts help organizations make data-driven decisions. Both roles require strong analytical skills and the ability to communicate effectively with stakeholders.
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