A: There are many different benefits companies of conducting multivariate analysis. Doing so can help companies forecast future opportunities, risks, demand for products, etc. And that helps with investment strategies, business decisions, and setting expectations.
Operational efficiency is another way a business may strategically use multivariate analysis. Regression models, for example, can be used to optimize business processes. A factory manager can create a model to understand the impact of oven temperature on the shelf life of cookies baked in those ovens, or a call center can analyze relationships between the wait-time of callers and the number of complaints.
The information derived from multivariate analysis can also support data-driven decision making and eliminate guesswork with corporate policies and processes. Businesses often have large quantities of financial, operational, customer, and purchase data that help inform business decisions based on statistical significance, instead of intuition and gut feel. By relying on multivariate analysis, you can decrease your overall risk and chance of failure.
Multivariate analysis can also correct errors. Not only can regression modeling, for example, help support management decisions, but it can also help identify errors in judgment. A retail store manager may believe that extending shop hours will increase sales, but multivariate analysis or regression analysis may actually indicate that increased revenue might not be sufficient to support the rise in operating expenses due to longer working hours.
A company may also use multivariate analysis to gain new insights. They can uncover new customer targets or identify market patterns that exist during certain times of the year or hours of the day. Without analysis, those signals might be buried in a large collection of unorganized data.