The Business Intelligence industry is a rapidly evolving space which continues to show strong year on year gowth with no obvious signs of slowing. As with any term as important as BI, there is a lot of confusion about what it is and how it may apply to your business. To help you understand this term, we’ve collected definitions of BI from around the web to share with you.
Definition of Business Intelligence
Let’s start with Google’s top result, Wikipedia: “Business intelligence (BI) is a set of theories, methodologies, processes, architectures, and technologies that transform raw data into meaningful and useful information for business purposes. BI can handle large amounts of information to help identify and develop new opportunities. Making use of new opportunities and implementing an effective strategy can provide a competitive market advantage and long-term stability.”
What is business intelligence software?
Business intelligence software are the tools that make it possible to create value from big data. Some examples of business intelligence technologies include data warehouses, dashboards, ad hoc reporting, data discovery tools and cloud data services.
Business Intelligence tools are crucial to effective measurement through the use of key performance indicators and metrics across all levels of an organization, in all industries. Business intelligence tools allow companies to see both historical and current data in context, which enables better decision making and/or prediction development depending on your business objectives.
How is business intelligence used?
Business intelligence has as positive a impact on an organization’s people as it does on performance, projects, and decisions. Business Intelligence is used to turn data into actionable information for leadership, management, organization and decision making. The following are some of the ways organizations are learning to use business intelligence:
- Analysing customer behaviours, buying patterns and sales trends
- Measuring, tracking and predicting sales and financial performance
- Budgeting and financial planning and forecasting
- Tracking the performance of marketing campaigns
- Optimising processes and operational performance
- Improving delivery and supply chain effectiveness
- Web and e-commerce data analytics
- Customer relationship management
- Risk analysis
- Strategic value driver analysis
Organizational benefits of implementing business intelligence
- Quick answers to critical business questions.
- Align activities with strategy.
- Reduce time spent on data entry and manipulation.
- Gain in depth real time insights into customers.
- Benchmark data against competitor and historical data for continuous improvements.
- Identify and analyze areas to cut costs and for budget allocation.
- Boost internal productivity by spending time on what’s important.
How do I know when to use business intelligence for my business?
All organizations will benefit from business intelligence, but here are some clear indicators that you should look into a business intelligence technology for your business:
- The need to integrate data from multiple business applications or data sources
- Lack of visibility into the company’s operations, events, news, finances, and other areas
- The need to access relevant business data quickly and efficiently
- Increasing volume of users requiring and accessing information and more end-users requiring analytical capabilities
- Rapid company growth or a recent or pending merger/acquisition
- Introduction of new products
- Upgrades within the IT environment.
Business intelligence is meant to empower your people as much as it is your business. Companies have found that allowing employees to access and track analytical and operational data improves work efficiency and goal reaching by monitoring real-time efforts alongside the business plan. The power of BI provides your teams the opportunity to tell their data stories, working faster, smarter and embracing a more open and transparent work space. That’s taking it to the next level.
What kind of businesses use business intelligence?
All kinds of companies use business intelligence! Business intelligence is helpful for businesses of all sizes and industries – from big to small, and from food to software. It’s global.
“In retail, Wal-Mart uses vast amounts of data and category analysis to dominate the industry. Harrah’s has changed the basis of competition in gaming from building mega-casinos to analytics around customer loyalty and service. Amazon and Yahoo aren’t just e-commerce sites; they are extremely analytical and follow a “test and learn” approach to business changes. Capital One runs more than 30,000 experiments a year to identify desirable customers and price credit card offers.
As these examples demonstrate, all business can benefit internally as well as externally in terms of customer satisfaction with business intelligence. BI enables improved internal communication through simplified collaboration and sharing so that business objectives and performance properly align.
What’s the difference between business intelligence and competitive intelligence?
There are a number ways to view discrepancies between business intelligence and competitive intelligence. Competitive intelligence is defined as the process of gathering and analysing intelligence about a business’s external environment, such as the market landscape for a particular industry or a business’s competitors. In contrast, business intelligence is understood as internal business insights, what your company is doing.
Business Intelligence and Competitive Intelligence may technically have different definitions, however they are closely related and must work together to make informed business objectives. Some consider competitive to be a subset of business intelligence because the information gathered from competitive intelligence adds value to data collected from BI and decision making.
It is important to note that many business intelligence tools have competitive intelligence functionality. For example, dashboards can be used to track competitors to identify opportunities in areas such as keywords and social media content.
What’s the difference between business intelligence and business analytics?
There are a number of different perspectives in the discussion of the difference between business intelligence and business analytics. The first understanding is that BI and BA are basically the same, arguing that BA is the heart of BI, excluding the actual process of decision, and focusing on the steps towards decision making.
Others say business analytics, like business intelligence, collects and analyzes data, utilizing predictive analytics and generates visual overview reports to help address the best areas for business improvement, opportunities and strengths.
This perspective states the key difference is that business analytics solutions uses predictive analysis to solve problems before they’ve occurred, while BI enables organizations to track real-time to identify current problems and opportunities. Business Intelligence solutions may be more optimal for organizations that are satisfied with their business model and primarily want to improve operations, increase efficiency and meet organization goals, to make good change.
What is pervasive BI?
It’s a term that is getting a lot of attention these days, but what is pervasive BI and why is it important?
Pervasive BI — A definition
The term “pervasive BI” refers to organizations that have included the majority of their employees in their business intelligence solution. This can take a variety of forms such as including middle management in the formation of realistic and useful objectives, or providing employees with access to performance dashboards. It is difficult to determine quantitatively if an organization’s BI solution is pervasive. Instead, qualitative measures should take precedent, looking at the solution’s influence and effectiveness at driving performance throughout the organization.
What knowledge is the “right” knowledge?
The goal of pervasive BI is not to simply provide access to raw data, but to include your employees in the formation and attainment of business objectives. Consider the following example of a call center monitoring current service level. To maximize that metric’s usefulness, it should be compared against existing service level agreements (SLA) to provide a view of the center’s current performance. Individual agents can then act on that information and change their actions and behaviors when the SLA is not being met. This is the type of knowledge that is at the heart of business intelligence. By providing insightful knowledge about performance, employees can take the initiative and make more informed decisions that positively impact your organization’s performance.
Including everyone in a BI Solution is a challenge because you need to display your business’ knowledge in the right way to the right people. The fact is that most employees only need access to job-specific metrics, such as the call center agent monitoring current service level. Pervasive BI is about optimizing performance at every level of your organization, so the KPI message has to be relevant and actionable. To achieve this, businesses need to consult with department heads and middle managers to determine what the priorities on the ground are and figure out how that department fits within the larger picture of the organization. The idea behind pervasive BI is to get everyone on the same page and working towards the same objectives.
Where are we now?
For the vast majority of organizations, BI solutions have yet to become pervasive. In an Information study it was found that of organizations with a BI solution in place, only a quarter of employees had access to those tools. That is a telling figure — BI still has a ways to go before it is pervasive. Accounting for this knowledge-gap is the fact that modern business intelligence is only starting to mature and realize its full potential. One aspect of this is the emergence of business intelligence software such as operational KPI dashboards. These dashboards effectively broadcast knowledge to employees using clear and simple visualizations such as graphs, charts, and tables.
Business Dashboards are an essential piece of the pervasive BI puzzle. They are an easy way to include everyone in the BI solution by providing access to important business knowledge. When BI systems started to become popular in the late 1990s and early 2000s, many businesses deployed them to skilled analysts, who generated reports at the executive or upper-management level. With the availability of operational data, easy to use dashboards, and cost-effective mass licensing, there is a shifting attitude where many organizations now view access to the dashboard at all levels of the organization as an integral part of their BI strategy.
Going pervasive in the age of mobile BI
While many organizations have invested in a desktop or on-premise KPI dashboard, an exciting new possibility for “going pervasive” is mobile BI. Mobile BI dashboards offer a level of accessibility that is not possible with desk-bound tools — today’s mobile BI solutions are accessible> via any smartphone (iPhone, Android, BlackBerry), tablet (iPad, iPad2), or Internet browser. This means remote workers can stay informed about important KPIs even when they are away from the office.
In addition to the benefit of accessibility, mobile BI is also advantageous because it is scalable to any number of users. As most mobile BI solutions are delivered as a Software-as-a-Service (SaaS BI), deployment requires little IT involvement or infrastructure. Adding new users to the dashboard often only requires adding additional licenses. While mobile BI is still in its infancy, it is already showing its potential for delivering on the promise of pervasive BI.
The future of pervasive BI
Pervasive BI is one of those concepts that is intuitively recognized as positive and having a lot of potential. The benefits of pervasive BI extend the benefits of business intelligence to your entire organization. The pace of business is rapidly accelerating, so being knowledgeable about your business is more important than ever. Keeping everyone in your organization informed is what pervasive BI is all about — and it will impact performance, understanding, and loyalty.
Achieving pervasive BI is not an easy or instantly attainable goal. As with any business intelligence strategy, it requires a lot of effort and analysis to determine what knowledge is useful to each department or employee. It also requires a solution that is trusted, clear, and effortless. That is why Self-Service BI tools are also on the rise! As noted above, the reach of BI tools in organizations is currently at about 25%. That number will likely never reach 100%, but that isn’t necessarily important. Rather, qualitative measures need to take precedent, and emphasis placed on the effectiveness of the solution at getting your entire organization on task.