DAC Business Intelligence & Analytics Strategy Flashcards

What is a Key Performance Indicator (KPI) in business analytics?

Answer: A measurable value that demonstrates how effectively an organization is achieving key business objectives

KPIs are quantifiable metrics tied to strategic business objectives that help organizations track performance and measure progress toward goals.

What distinguishes descriptive analytics from predictive analytics?

Answer: Descriptive analytics summarizes historical data; predictive analytics forecasts future outcomes

Descriptive analytics answers 'what happened?' by summarizing past data, while predictive analytics answers 'what will happen?' using statistical models and historical patterns.

What is a data warehouse in a business intelligence context?

Answer: A subject-oriented, integrated repository of historical data optimized for analytical queries

A data warehouse is a centralized repository of integrated, historical data from multiple sources, designed and optimized for analytical reporting and decision-making.

Which of the following is an example of prescriptive analytics?

Answer: An optimization model recommending the best pricing strategy to maximize revenue

Prescriptive analytics goes beyond prediction to recommend specific actions, often using optimization algorithms to identify the best course of action.

What is the purpose of a data mart in a BI architecture?

Answer: To provide a department-specific subset of a data warehouse focused on a particular subject area

A data mart is a focused subset of a data warehouse designed to serve the analytical needs of a specific business department or subject area (e.g., sales, finance).

In BI, what does a star schema consist of?

Answer: A central fact table surrounded by denormalized dimension tables

A star schema features a central fact table containing measurable business events connected to denormalized dimension tables that provide descriptive context.