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The distinction between a business analyst and data analyst is so nuanced that the terms are often used interchangeably. Both professionals work with data to help organizations make smarter decisions. However, data analysts are more focused on data collection and interpretation, whereas business analysts work closely with clients to help them improve their business processes. A large number of similarities often leads to confusion and misunderstandings, which is why today we are talking about the differences between a business analyst vs. data analyst. In this article, we will take a closer look at the responsibilities of both types of analysts and their differences and essential skills, as well as try to determine which professional can help your company achieve its goals.
Data analysts collect, analyze, and visualize information to tell stories using data and help business executives make informed decisions. They sift through large amounts of data in order to answer business-related questions and improve organizations. When compared to business analysts, data analysts tend to be more focused on the technical parts of data rather than business-related nuances. In other words, their services imply close work with various datasets and present information in meaningful and useful ways to help business managers with their decisions.
The primary duties of data analysts include maintenance of databases and data storage as well as problem resolution. They also gather and clean information to make it usable for business analytics. For these purposes, data analysts are expected to be proficient in data visualization techniques, SQL, Excel, R, and Python. Finally, they need to be able to present their findings in understandable ways and communicate information to the company’s executives.
Business analysts are responsible for applying data-driven insights to make better strategic decisions. Unlike data analysts that focus on data, business analysts’ main goal is to optimize and improve the business. They help customers identify potential bottlenecks, roadblocks, and issues, as well as opportunities for the company and improve business processes. Business analytics is about detecting problems and using the company’s data and analytical thinking to resolve issues and help the company grow.
The responsibilities of business analysts comprise business process evaluation and discovery of potential risks and opportunities that their customers might face. They also compose detailed reports with concrete recommendations for process optimization and KPI improvements. Business analysts also usually have superior communication skills and can convey their insights to decision-makers and other stakeholders.
Now it is time to try to uncover the differences between business analytics vs. data analytics. In this section, we will dissect the requirements, tasks, professional services, and tools that both data and business analysts use and pinpoint the differences between their services.
What is the difference between a data analyst and a business analyst when it comes to the analytical process? As mentioned before, data analysts work with data in pursuit of extracting meaningful insights and patterns. This process is also known as data mining. Data analysts begin with determining the criteria for their analysis and grouping and categorizing datasets. Later, they collect all the relevant data from the pool and extract the important information using SQL. Using various tools and know-how, they transform and visualize data to present it in an understandable way. The most relevant pieces of data undergo statistical analyses and are later summarized into full reports.
Business analysts also work with data but in different ways. They use insights and trends prepared by data analysts to improve the business. At first, business analysts meet with stakeholders to gather project requirements and business goals and gain an understanding of the company’s systems and processes. After collecting all the vital information, business analysts create a plan of action, which includes deliverables, project scope, budget, timeline with milestones, action owners, etc. Later, they present the plan to the stakeholders to make possible changes and create the final version.
If the project is approved, business analysts facilitate the adoption of the plan. They create detailed documentation, conduct training, and make recommendations to smooth the process. Business analysts also calculate the additional value that their solutions will bring to the company to demonstrate how exactly these actions will enhance the business.
As you can see, data analysts concentrate their work on datasets, trends, and insights, which can be further used by business analysts and other professionals to make significant changes to the company. These insights can help business analysts optimize processes, increase revenue, enhance sales strategies and much more.
Let’s talk about business analytics vs. data analytics when it comes to software that these professionals use for their work. The tools that business and data analysts use actually overlap as both parties work with data and need suitable software solutions and platforms. They both employ business intelligence (BI) tools like SAP, Microstrategy, and Datapine. But data analysts also require specialized systems like ETL (extract, transform and load) tools to move data, data visualization tools like Tableau, Qlik Sense, and Grafana, as well as statistical digital solutions like MATLAB, Excel, and others.
Business analysts utilize project management software for action planning and executing, monitoring like Zoho, Asana, and Jira, documentation tools like Confluence and Nuclino, as well as business process management systems (BPM) like Kissflow and ProcessMaker.
The methods and techniques that data analysts and business analysts use also drastically differ. Data analysts operate with statistical methods and machine learning techniques to interpret information and make meaningful conclusions. They utilize descriptive analysis, regression analysis, neural networks, decision tree analysis, and more.
Business analysts conduct SWOT (strengths, weaknesses, opportunities and threats) analysis, MOST (mission, objectives, strategy and tactics) analysis, and various types of brainstorming to understand the company and identify problematic spots. The two mentioned analyses are the most common ones, but business analysts use other methods like design thinking, PESTLE (political, economic, sociological, technological, legal and environmental) analysis, and many others.
Finally, there is an educational and professional background disparity between business analytics vs. data analytics. Data analysts come from data science backgrounds and have extensive technical knowledge. They spend their days collecting raw unstructured data from myriads of sources, and clean and categorize it using various techniques to identify meaningful patterns and interpret their findings. Data analytics is a highly technically dense field that requires solid programming skills, database knowledge, and statistical acumen.
Business analytics focuses on applying data to identify and solve business issues. Although business analysts are encouraged to understand the basics of data science and statistics, their primary duties lie in business administration. They define strategies, analyze business insights, and communicate with stakeholders in order to optimize business processes.
In which industries do you need a business analyst or data analyst? Let’s go over the most prominent industries that benefit from these professions.
The healthcare industry collects vast amounts of data that cannot and should not go missing. Data helps make discoveries, test drugs, analyze treatments, and much more. Data analysts can gather, structure and interpret information to help clinicians make informed decisions.
Finally, data analytics can be used in business to detect critical patterns, discover insights, and draw meaningful conclusions that help optimize the organization. Data and business analytics are applied to launch marketing promotions at the most suitable times, learn more about customers and their purchasing behavior, and more.
Banking is an industry that requires a high level of security and data protection. Data analytics helps bank workers to monitor transactions and identify patterns and thus detect potentially fraudulent behavior.
Governments also deal with mountains of data that can be used to improve the safety and convenience of our cities. For example, data analytics and machine learning are used to design smart cities that can make our lives easier and safer.
Simply put, it’s not about comparing data analysts vs. business analysts as much as it is about both roles working together on the same project. While data analysts sift through immense amounts of data and identify relevant patterns, business analysts use these findings to help organizations make their business better. Ideally, they work as a team and have the same goal that correlates with the company’s objectives.
Depending on your organization and objectives, you may require a data analyst, a business analyst, or both to take your business to the next level. If you are uncertain about which role you need to fill, contact NIX United for helpful insights. We are a team of software engineers and data scientists with an extensive portfolio of successful cases. We are happy to share our expertise and help you make the right decision about optimizing your business and hiring the right person.
An AI Solutions Consultant with more than 10 years of experience in business consulting for the software development industry. He always follows tech trends and applies the most efficient ones in the software production process. Finding himself in the Data Science world, Evgeniy realized that this is exactly where the cutting-edge AI solutions are being adopted and optimized for business issues solving. In his work, he mostly focuses on the process of business automation and software products development, business analysis and consulting.
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