What is Business Intelligence (BI)? From Data to Decisions

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Summary: Business Intelligence is about using data to make better, more informed business decisions. Data-driven business decisions boost operational efficiency and customer satisfaction while lowering risk and driving innovation.

Business intelligence includes all of the tools, tech, applications, and practices involved in collecting, analyzing, and using data to inform business decisions. BI provides a historical, present, and future view of business operations, leveraging data to present insights that allow key decision makers to make more informed, strategic, and aligned decisions to enhance business efficiency and increase competitiveness.

Components of Business Intelligence

Data Warehousing

Just like an Amazon warehouse is a central repository of Amazon products that have been sent there by a variety of sources (sellers), a data warehouse is a central repository of data collected from a variety of sources. Data warehouses make it easier to store, organize, and retrieve data, and this boosted consistency and availability of data boosts the speed and efficiency of data science and, subsequently, business intelligence within a business organization.

Data Mining

Like mining for diamonds, data mining is the process of searching for valuable insights within large sets of data. Data mining is used to extract knowledge and patterns from data in order to identify trends, correlations, and anomalies which can then inform business decisions. For example, data mining can reveal customer purchasing behaviors, and that knowledge can then be used to tailor marketing strategies.

Reporting

Reporting involves presenting key findings via reports and dashboards so that results are presentable and approachable to a variety of key decision-makers. When creating visual reports, common tools used include Power BI and Tableau. Some types of information communicated via reports include performance metrics, financial results, and other forms of critical business data that can guide strategy and planning for data-driven decision making.

BI Objectives

What are the objectives of business intelligence? Why should your business have a BI strategy?

Enhancing decision-making processes

BI enhances decision-making by supporting data-driven insights-leaders can make strategic decisions based on historical and predicted information rather than on gut-feelings. Often, BI software and data analysis can spot trends and insights that would be missed by a human. This is, in part, by virtue of the sheer amount of data that can be processed by a machine, but statistical analysis and machine learning can also unearth patterns that humans may not so readily see without the help of technology.

Increasing operational efficiency

By analyzing data, businesses can spot inefficiencies and streamline operations. BI supports optimizing processes, enhancing productivity, and lowering costs. For example, BI can reveal supply chain bottlenecks ahead of time, allowing for more buffer time to prepare or otherwise resolve the issue.
Identifying market trends and business opportunities

Market shifts become more apparent with BI. By predicting market conditions and consumer behavior, businesses are better able to launch products and services that lead markets, boost revenue streams, and find new growth opportunities vs. businesses that are simply following trends. BI helps businesses move from reactive to predictive, creating leaders in innovation.

Benefits and Challenges of Implementing BI

Benefits of Business Intelligence

Business intelligence can result in improved data accuracy and consistency in part due to maintaining a central repository of data that is regularly cleaned and analyzed. BI also results in faster analysis and reporting, better decision, boosted optimization and growth speeds, and better alignment with business goals. As a result, BI also results in substantial boosts to customer satisfaction and retention.

Challenges in BI Implementation

Implementing business intelligence processes for the first time can seem daunting. Especially in the past, high initial costs and ongoing maintenance kept all but the most successful companies from implementing BI. Now, however, BI is more approachable and is being utilized by businesses of all sizes. Data integration and quality issues can still be problematic for beginners, especially those without skilled personnel and training. Now, more than ever, BI is approachable-even for those without large amounts of technical know-how. With substantial improvements to tools and processes over the last several years, BI is available to anyone.

Help With Business Intelligence Strategy and Setup

Newcomers to business intelligence and data science can benefit substantially from having a knowledgeable guide or consultancy assist with their initial strategies. VisionWrights can set your business up for success with business intelligence strategy and implementation that incorporates the latest as well as the tried-and-true of data science, business intelligence, and artificial intelligence strategy. Reach out today to see how we can help secure the success of your business, for now and in the future.

 

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