Sunday, September 4, 2011

How to structure business analytics team

Today many organisations are trying to find answer to the following questions

1. How do they structure business analytics team?
2. Who should they hire?
3. Should they have business analytics team as part of IT or BI group?
4. Should they have centralised business analytics team or decentralised team?

Determining business analytics team structure is a very important step for successful roll out of business analytics initiative in enterprise.

I would recommend the following org. structure for business analytics team.

Business analytics team should be decentralised and part of business team. This means that you need to have marketing analytics team as part of your sales & marketing business unit & risk analytics team as part of risk business unit. Business analytics team shouldn't be part of IT or BI group.That's because developing, testing and maintaining complex analytical data models involves significant domain-specific business knowledge. This will also help organisations to embed analytics into their business processes. It is very essential that there is a formal communication channel in place between IT/BI groups and business analytics team. This channel can be used to communicate best practices across various groups.

Business analytics team should comprises of business analysts and statisticians. Business analysts are MBAs with specific business function knowledge. They will be responsible for defining business problem and communicating results of analytics. Statisticians (PhDs or Masters in statistics) will be responsible for building and testing analytical models. I would recommend ratio of 2:1 between business analysts and statisticians.

Data preparation is very important step in building business analytics models. This responsibility should be given to either IT or BI team. If this activity is not performed well or if there is no formal communication channel in place between IT and business analytics teams then your business analytics initiative will fail. This is the most trickiest part of the entire structure. You have to have top management commitment & involvement to make this happen. I had seen rift between business analytics and IT teams in many organisations in past. Business analytics team used to complain that IT team is not giving them data in right format at right time. IT team used to complain that business analytics team is asking for data elements which are not captured in source systems. The only way to solve this problem is to have senior management sponsorship and involvement.

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