Over the last decade the interest in Business Intelligence (BI) has become widespread across all industries. This term, which refers to technology, information systems, and practices for collecting, integrating, analyzing, and presenting business information, is something that should be on the radar of all organizations. This article will answer the question of what is business intelligence?
What is Business Intelligence – Overview
Business Intelligence is a broad term that refers to different types of technology and information systems, as well as methods, techniques, and the processes of obtaining and utilizing business data.
The goal of business intelligence is to understand your business better, which will allow the organization to make strategic decisions based on underlying data instead of relying solely on gut instinct. Business Intelligence is all about transforming data into insightful information that can be acted upon. One can then leverage this information to help and assist in digitally transforming an organization.
It should be known that every organization may define business intelligence differently, so it is important to understand your business’ goals and expectations before you dive in.
If you are looking to launch a successful BI department within your organization, you must be willing to roll up your sleeves and learn about all of the processes that are currently being used across your entire business. You will also need to know what business data is currently being collected which will differ between organizations.
Depending on the type of industry you are in, the data can be based on customer trends and purchase history, transaction data, consumer demographic data, and in some cases consumer internet history.
Benefits of Business Intelligence
If you are asking what is Business Intelligence, then you may be wondering how deploying BI techniques within your organization can be beneficial. Below are just a handful of these benefits.
One of the main goals of business intelligence is to create efficiencies within your organization. By leveraging different software programs and applications, you may be able to automate processes that will end up saving time which can be transformed into cost savings.
Having access to business related data by itself will not be very useful – it is all about how you use this data to provide insight. One of the mail goals of Business Intelligence is to turn this random and sometimes meaningless data (if it is looked at a high level) into information which can be acted upon.
By analyzing this data through several different techniques, and possibly applying forecasting and predictive analytics models to this data, you will be able to uncover patterns and find meaningful insights that may have remained hidden. This information can then be leveraged by management to make strategic decisions to strengthen the competitiveness of your company.
Reducing Cost/Increasing Profitability
By utilizing your business’ data, you should be able to create efficiencies within by automating processes. For instance, if you are able to automate the generation of a monthly report that normally takes an employee 4 hours to complete, you immediately created a costs savings. This 4 hours a month is nearly an entire work week. Now that the time has been freed up, this employee can focus on more value added tasks, like obtaining new customers.
What is Business Intelligence – Software and Systems
Before you will be able to recognize the benefits of Business Intelligence, you will need to make sure you have the proper software and systems in place. When asking what is Business Intelligence it is imperative that you know about these types of technology in order to understand the big picture. Below are several types that are worth mentioning:
In its simplest form, a database is just a repository of all of your business data. Databases can normally be queried (through a programming language such as Structured Query Language – also known as SQL) which will allow you to return exactly the data you are looking for.
Databases can either be structured in a relational way, meaning that all of the data stored within is in some way related to each other. An example of this would be a database that stores client data – each client will have a specific identifier, and all of their information such as purchase history, payment information, and demographic data will be stored in separate tables within the database schema that can be linked back to that distinct identifier.
Another type of database is a non-relational database. Non-relational databases contain all of the data you are looking for however it is stored in a way which may be advantageous depending on the amount of data stored.
An example of a non-relational database is a graph database. This type of database is designed so that each piece of data is equally important and looks almost like a web – each individual entity connects or is related to others. A real world example of a company that utilizes a graph database is FaceBook – every user is linked to other users through their friends, and users that are not friends are linked together by mutual friends.
In most cases, each source of business data within your organization will require its own database. If you work in a financial institution, you will most likely have a core system that houses client data such as personal information, account information, and transaction history. You will also have additional systems in use for other purposes – this data will most likely housed in a separate database.
Having multiple databases for different data can cause headaches if you ever wanted to cross reference data stored in different databases. A data warehouse solves this problem as it aggregates data from disparate sources into one.
Data Visualization Software
In order to get the most out of a database or a data warehouse, you are going to need a way to visually represent it. While it is possible to extract data from a database or data warehouse into excel to perform additional analysis or create graphs, charts, or pivot tables, this is not the most effective way to do so.
This is where data visualization software comes into play. This type of application is able to ingest the data from your sources and generate interactive dashboards that provide insight into possible trends in your data. This tool provides an accessible way to see and understand data trends, outliers or extreme values, and patterns in the data that may be otherwise difficult to spot by just looking at the data itself.
Two examples of data visualization software that are popular within the business intelligence community are Tableau and Power BI.
If you want to make the most out of launching business intelligence methods in your organization, or just want to get more information about the subject to see if it makes sense to pursue further, then you may want to do some additional research. Below are some materials that we recommend.
A great book that details Business Intelligence in its entirety, including discusses all of the related topics, trends, technology, and applications, is Business Intelligence For Dummies.
After reading this book you should be able to:
- Determine what your business needs
- Compare different approaches to BI
- Build a solid BI architecture and roadmap
- Design, develop, and deploy your BI plan
- Relate BI to data warehousing, ERP, CRM, and e-commerce
This book is a super useful resources, even for those are have experience in the field. The best part is that it can be picked up for just around $20.
Being interested in BI and understanding how its applications can help you and your organization is only half of the battle. The other half is convincing management at your business to give you the green light on implementing BI.
Data Science for Executives: Leveraging Machine Intelligence to Drive Business ROI is a great book that can give you insight as to how to sell Business Intelligence to management. This book, in conjunction with Business intelligence for Dummies will give you an understanding of the entire picture, from collecting and managing data, to making sure your company can realize ROI from moving forwards. Lastly, this book only costs $10.
“In Data Science for Executives, Nir Kaldero dispels the myths and confusion surrounding this game-changing technology and provides practical strategies for harnessing its profitable power.”
Being able to successfully convey this message is critical, as many times Business Intelligence related projects can be costly.
No matter what type of Business Intelligence application you choose to pursue, you will most likely need to be familiar with the underlying programming language that is used across many BI platforms. This language is known as Structured Query Language (SQL) and is pretty simple to use, easy to learn, and very powerful.
“SQL (Structured Query Language) is the language we use to interact with databases that store data. This allows us to retrieve data with ease and simplicity. As terms like business intelligence and big data become more familiar, businesses will need more people to learn the SQL language.”
If you want to learn how to use this language, as well as how it can be used in a business environment, we recommend checking out this all inclusive online Udemy course – SQL for Beginners.
This class includes around 4 hours of video content as well as 39 lectures. This online course is currently priced at $15 which is an incredible value for what you will get out of it.
What is Business Intelligence – Summary
Looking at Business Intelligence from the outside with little to know background knowledge may seem intimidating. This is especially true if you are unfamiliar with BI terms such as SQL, databases, or data warehouses.
We hope that this article gave you some information and answers to the question of What is Business Intelligence? If you are looking to take an even deeper dive, then be sure to check out the resources that we listed above.