For understanding the business problem, there is a process called CRISP_DM Framework.
"Cross Industry Standard Process for Data Mining (CRISP - DM)" Framework
The Various Steps or stages of defining a Business Problem
Step 1. Business Understanding
Step 2. Data Understanding
Step 3. Data Preparation
Step 4. Data Modelling
Step 5. Model Evaluation
Step 6. Model Development
Imagine you are on your bike trip to Ladakh and your bike broke down in the middle of nowhere.
You have a toolkit and you want to repair the bike. TO DO SO, you need to know exactly what has gone wrong. Is it Battery issue or simply ran out of fuel?
Same like for solving business problem, understanding the business and its specific cause or RCA (Root Cause Analysis) is of most important. Only then you can make a perfect strategy to solve it else you will be supper busy in solving the wrong problem which can be a waste of time (on that part).
Now after knowing the real problem or cause of your bike, you will do rightfully work to your bike with selected tools. and that is called a Real Problem Solver or In Data Field, an Analytics Project.
Note: Understanding the business data will improve the understanding of business.
To understand any problem we first need to decide the business objectives clearly and then determine the goals of data analysis.
For Example : An IPL Team Player Auction- Business Understanding
We all are connect with cricket so imagine you are working as data analyst or data scientist in an IPL Team. The most challenging problem in this business is buying the right players. "Buying the right player does not mean that match winners are the only players but rather than the ones who ca help team owner to generate or to make money. Any Business final output is only to make profit and we know that "Profit = (revenue - cost)", the team need to make more revenue than costs.
Lets Deep dive into each section.
1. Revenue: 50-60%, Mostly Revenue comes from the broadcasters side like the brand SONY, Jio Cinema, and cricket board shares the part with the team. It does not matter what players they choose.
2. Sponsorship: 20-30%, sponsors like the logos on players jerseys, bat, and helmets are the advertisement. Players also promote from TV ads, and most of the money goes to team owners.
3. Ticket Sales: 8-10%, This amount also goes to owners , which is the amount is about 8-10% of total revenue.
4. Prize Money: 5-10% Like the winning team itself gets about 20-30 crore rupees which is low as we compare it with sponsors and ads.
So what the outcome here , First business objective is to buy the player who help in generate revenue, then effect of players on sponsorship revenue for example buying young player for ads like deodorant or shaving cream. The large revenue part is sponsorships and it depends what data you collect and analyze like only working on stats of players runs and average will not help to generate revenue.
Now for any business there is COST also
so in this business we have Franchise Fee%, Players Costs %, Maintenance Costs %.