Many a times, I get the question, “How can I have more ‘business sense’ in analyzing my data?” In other words, how does one know the insights gained from data is of value to business or not?

Now it can be very challenging for someone who is so well-versed in mathematics and computer science to know the other world, THE business/domain. Because the business jargon, processes and knowledge that one dealt with, can be less rigid, have more complicated overlays of business rules and processes. That to me is the fun part of doing business.

This blog post serves to help new data scientist to develop business acumen,  to understand, to some degree, how much impact can their insights  provide.

Business knowledge can be split into three levels.

1 — General Business Knowledge

2 — Industry-Specific Knowledge

3 — Company-Specific Knowledge

Let us look at each one of them.

General Business Knowledge

As  the name says, general business knowledge refers to knowledge that are  the same across businesses, regardless of industry or company. For  instance, accounting standards (GAAP or IAS), knowing what is account  receivables, cost-of-goods etc. It can be about general strategic  management models such as the balanced scorecard, SWOT analysis. It can  be about understanding the general logistics processes, manufacturing  etc. Very likely such knowledge and information  are found in a typical MBA program, so you can pick them up through  courses that are related to business administration and management.

Industry-Specific Knowledge

Industry  specific knowledge will be dependent on the industry the business is  in. For instance, if you are in the financial industry, you have to be  concerned with regulations and compliance, the accounting standards and  risk management standards such as IFRS, Basel III etc. There is a need  to understand local regulations as well, when you are in the financial  industry. Rules such as minimum age for credit card applications, the  loan quantum for mortgage set by the regulators are industry specific.

If  you are in the healthcare business, how human testing of medicine  should be conducted, the permissions that are required etc are  industry-specific knowledge as well.

To pick up such knowledge, I recommend business weeklies such as Bloomberg BusinessWeek and The Economist. They report the latest trends in  industry and has good analysis on the implications to the industry.

Company specific knowledge

Company  specific knowledge will be things like what is the competitive  advantage, business model, revenue model, target market, business  process of the company you are in. Some of these knowledge are “top secrets” and are very different for different companies.

One possible source is the financial statements that are filed and made public. But definitely company-specific knowledge cannot be taught in schools and  programs. The knowledge are usually accessible only when you have joined  the company rather.

In conclusion

General business knowledge and industry-specific knowledge can be picked up easily through books, business periodicals and MBA program perhaps but  it is the company-specific that cannot be taught and has to be picked up  when one is working in the specific organization/business.

If  the blog has been useful to you, please do give a clap or two. I wish  all readers a FUN Data Science learning journey and do visit my other blog posts and LinkedIn profile.