Business Intelligence is the ways in which can be stored and used business information. It encompasses the technologies, applications, and means for collecting, integrating, analyzing, and presentating bsuienss data. BI is the acronym for the term “Business Intelligence”.
Using data that has been stored in a data warehouse, software applications are able to use this data to report past business information as well as predict future business information, including trends, threats, opportunities and patterns.
Popular BI applications are very complex and experts in this field are in high demand. Some of the currently popular enterprise level systems, which can manage information about all of the business functions and systems, are sold and implemented by Oracle, SAP (Systems, Applications, and Products in Data Processing), IBM (International Business Machines Corporation), and HP (Hewlett Packard). Companies often need in-house experts in these systems to assist with the implementation and the on-going use of these systmes, which are quite complex!
Business Intelligence (BI) is much more than software and describes a set of processes and technologies for simplifying and enhancing the use of information within a Company. In BI data is gathered from the IT systems in a company, whether they be ERP or CRM systems, or from Excel spreadsheets and other personal productivity tools. Data is cleaned, standardised and then presented to business users in a friendly way.
Business intelligence (BI) is a broad category of application programs and technologies for gathering, storing, analyzing, and providing access to data from various data sources, thus providing enterprise users with reliable and timely information and analysis for improved decision making.
To put it simply, BI is an umbrella term that refers to an assortment of software applications for analyzing an organization’s raw data for intelligent decision making for business success. BI as a discipline includes a number of related activities, including decision support, data mining, online analytical processing (OLAP), querying and reporting, statistical analysis and forecasting.
Online Analytical Processing is a category of database software that provides an interface to help users quickly and interactively scrutinize the results in a variety of dimensions of the data.
BI technologies provide historical, current, and predictive views of business operations. Common functions of business intelligence technologies are:
- Online analytical processing
- Data mining
- Business performance management
- Text mining
- Predictive analytics.
Business intelligence equips enterprises to gain business advantage from data. Once an organization is powered with BI it can anticipate enhanced turnaround time on data collection, come up with fresh ideas for novel business initiatives, foresee accurate picture of customer needs and demands, and perform more targeted marketing campaigns. In addition, it will gain enhanced knowledge that will help it advance its brand into the top slot in terms of market share, reduce its overheads and also diminish delays in supply chain, among other advantages.
Decisions purely based on the gut feeling cannot assure success; but in BI’s fact-based decision-making framework, confident decisions can be made for assured business success. Further, BI makes an organization agile thereby giving it a competitive edge in today’s evolving market condition.
Every day, a dairy company collects from 2,000 stores information which is uploaded to servers at its headquarters at the end of the day. This information is used by the chain’s main office to instantly analyze key operational measures such as the number of dairy products sold, profits, trends, and so forth.
Next day, by early morning the company’s managers receive performance data. Next, they verify current revenue, time required to perform each job, and other performance measures. With BI, franchisees with multiple locations can have consolidated views, as can the company’s regional managers.
This scenario clearly explains how implementation of Business intelligence can be very fruitful for an organization. BI can catalyze a business’s success in terms of
- Distinguish the products and services that drive revenues.
- Rank customers and locations based on profitability.
Customer relationship management
- Categorize low - value customers and work toward improving their value.
- Find customer relationship issues early and take timely action to resolve them.
Sales and marketing
- Aim at high - value customers to minimize marketing risk.
- Rank the success of product promotions based on product and market segment.
- Find what is in the sales pipeline.
Although there could be many factors that could affect the implementation process of a BI system, research by Naveen K. Vodapalli shows that the following are the critical success factors for business intelligence implementation:
- Business - driven methodology and project management .
- Clear vision and planning.
- Committed management support & sponsorship.
- Data management and quality.
- Mapping solutions to user requirements.
- Performance considerations of the BI system.
- Robust and expandable framework.
Business Intelligence, when properly implemented and used, delivers many benefits. Some of the key advantages include:
- Alignment of an organisation around a consistent set of Key Performance Indicators (KPIs) and Metrics
- Quicker, fact-based decision making
- Simplified graphical presentation of KPIs and metrics
- Reliable presentation of information
- Combination of multiple data sources (ERP, CRM, Spreadsheets, Budgets, etc.)
- Faster collection and dissemination of information.
Some of the major Business Intelligence disadvantages are:
- Piling of Historical Data
- Muddling of commercial settings
- Limited use
- Time Consuming Implementation.