The Benefits of Business Intelligence
I am often asked what can Business Intelligence do for my business. So my response is ... Business Intelligence (BI) is both a management process as well as a collection of software applications and underlying technology that enables organisations to make better business decisions by exposing key metrics that drive the organisation.
Business Intelligence is sometimes confused with Competitive Intelligence but they are not the same concepts. This is true even though BI technology does give management a methodology for getting a better grasp on the internal and external forces that are driving their organisation as well as a way to measure their organisation’s performance against the performance of their competitors.
Properly used, BI systems assist management in developing a data-based decision making model that provides more consistent results when compared to non-BI methods. Organisations that have successfully implemented BI systems have better and timelier access to customer activities, marketplace trends, supply chain issues and a host of other key performance indicators (KPIs) that are not able to be easily measured in a non-BI environment.
The Technology Behind The Business Intelligence Process
All of the data that BI systems access comes from the organisation’s data warehouse which is a specially-designed database that stores integrated data from various sources from within the organisation.
Business intelligence analysts perform data mining, which is the process of analyzing the data in the data warehouse to uncover patterns and relationships, using specialised BI tools such as Microsoft BI, Oracle BI and Business Objects BI.
Because BI needs vary among business sectors, many BI tools are highly industry-specific. Even so, most BI tools provide a similar core suite of capabilities which include executive reporting tools and a management dashboard that aggregates data and provides a high-level view of the organisation from a BI perspective.
Many organisations employ BI strategies in order to support the Balanced Scorecard (BSC) success measurement program. Unlike traditional measurements which are solely financial-based, the BSC approach measures both the financial lagging indicators as well as well as a variety of future performance indicators which are called leading measures. The BSC approach works so well because it not only provides a means for analyzing financial indicators, it also provides a way to quantify an organisation's other value drivers including its learning and growth perspective, business process perspective and its customer perspective.
Companies such as Exxon/Mobile and Cigna Insurance credit their profitability and explosive growth to implementing a BI/BSC strategy that enabled them to precisely gauge their market opportunities and position their companies to become financial and performance leaders in their market niches.
Business Intelligence is a process that works for any size organisation that is dedicated to gaining a competitive edge and raise their visibility in a crowded marketplace.