Business Intelligence (BI) is a system & process that gathers, stores, and analyzes the data generated by your business operations. With the ever-increasing competition in the market, companies must have a comprehensive view of their data, and that’s where BI tools come into play. Half of all businesses already utilize BI tools and the trend is projected to grow in the future. However, for those who are yet to adopt a tool or are seeking more information, it may be challenging to grasp the concept of BI.
Business intelligence is a comprehensive concept that incorporates data mining, process examination, performance evaluation, and descriptive analytics. It involves analyzing all the data produced by a company and presenting it in a simple, understandable format through reports, performance indicators, and patterns that guide managerial decisions.
By leveraging the information obtained through business intelligence and data analysis, organizations can make better business choices, pinpoint difficulties and challenges, detect market shifts, and discover new revenue sources and business prospects.
Organizations and companies have inquiries and objectives they aim to fulfill. To address these inquiries and monitor progress toward their goals, they gather relevant data, conduct analysis, and determine the necessary steps to achieve their targets.
The process of collecting data begins with acquiring raw information from business systems. This information is then processed and stored in various locations including data warehouses, cloud storage, software applications, and files.
Business Intelligence (BI) platforms provide a range of data visualization tools that can transform data into graphical representations such as charts and graphs. This makes it easier for key stakeholders and decision-makers to understand and analyze the data.
Business intelligence is a broad term that encompasses the various techniques and methods used to collect, store, and analyze data from business operations in order to enhance performance. This comprehensive view of a business helps decision-makers make informed choices. In recent years, business intelligence has evolved to include additional processes aimed at improving performance. These processes include:
Data Preparation: Combining multiple data sources, defining dimensions and measurements, and preparing it for analysis.
Business intelligence empowers organizations to ask questions simply and receive understandable answers. Instead of relying on assumptions, they can make informed decisions based on the information gathered from their business data, which can encompass everything from production and supply chain to customer feedback and market trends.
With BI, organizations can find solutions to crucial questions such as why sales are declining in a specific region, where surplus inventory is located, and what customers are saying on social media. Maamar Ferkoun, in his “IBM cloud computing and business intelligence blog”, states that business intelligence provides a comprehensive view of the past and current state of the business. This is achieved through a combination of technologies, including analytics, reporting, data mining, and predictive analytics. By presenting an accurate representation of the business at any given time, BI equips organizations with the tools to formulate business strategies based on factual data.
Business intelligence enables organizations to become data-driven enterprises and gain a competitive edge by improving performance.
Enhance return on investment by understanding the business and allocating resources strategically.
Uncover customer behavior, preferences, and trends and use the insights to target prospects effectively or tailor products to meet changing market demands.
Continuously monitor business operations and make improvements based on data-driven insights.
Streamline supply chain management by keeping track of activity along the line and communicating results with partners and suppliers.
Retailers, for instance, can reduce costs by comparing performance and benchmarks across different stores, channels, and regions. Additionally, with visibility into the claims process, insurers can identify areas where they are falling short of service targets and use the information to improve outcomes.
Business Intelligence (BI) has become an indispensable tool for companies of all sizes and industries. From human resources to marketing, compliance, and production, there are many reasons why organizations adopt BI into their operations. This tool has become a vital component of businesses as it provides them with better and more accurate information that can be leveraged to drive success.
The benefits of adopting BI are numerous, including improved data quality, faster and more accurate reporting and analysis, increased employee satisfaction, reduced costs, and increased revenues. BI also enables companies to make better business decisions, which can lead to greater profitability.
For instance, consider a scenario where you are responsible for managing the production schedules of multiple beverage factories and sales are showing strong growth in a particular region. By using BI, you can quickly approve extra shifts in near real-time, ensuring that your factories can meet the demand. On the other hand, if the summer season is cooler than expected and sales start to decline, you can easily adjust production accordingly to minimize costs. This is just one example of how BI can be used to increase profits and reduce costs when leveraged effectively.