Contents :
- Concept and Various Technologies of Business Intelligence.
- Framework and Elements of Business Intelligence.
- Working of Business Intelligence.
- Advantages & Disadvantages of Business Intelligence.
- Applications of Business Intelligence.
What is Business Intelligence ?
The combination of different types of systems and tools which are vital for strategic planning process of an organization is known as Business Intelligence.
An organization can store, gather, access and analyze the various corporate data for supporting the decision making process with the help of these systems. Various types of business intelligence in the fields of customer support, market segmentation, statistical analysis, inventory and distribution analysis, customer profiling are collected through BI systems.
A large variety of data is collected from different sources in a BI system and it helps in a significant manner in decision making process if these are implemented in an accurate manner by using advanced reporting and analytics.
The Various Technologies which are Employed in Business Intelligence are given below :
- Data warehousing, data stores and data marts.
- Query and report writing technologies.
- Decision support systems(DSS).
- Enterprise resource planning (ERP) systems.
- Product life cycle and supply chain management systems.
- Database systems and database integration.
- Customer relation management software.
- Data mining and analytics tools.
The conversion of data into useful information is the basis of business intelligence which can be utilised in taking various decisions and finally implementing these.
Framework of Business Intelligence :
For maintaining the entire data life cycle from fetching of data to storing it, converting, integrating, controlling, evaluating, archiving and presenting of data, a wide spectrum of applications and technologies are employed by BI. The operations of BI include the entire process from collecting the simple data and processing it into a very complex data analysis and presentation applications. BI covers highly integrated applications from a single vendor to a slackly connected environment of several vendors as it does not have any specific architecture. However, there are some basic operations which are shared by almost all BI.
The general framework of Business Intelligence is illustrated in figure :
The Key Elements of BI Structure are Described Below :
1) Data Warehouse :
A certain or special database or repository of data which is specially designed for supporting decision making process is known as data warehouse. It varies from easy query and reporting to complex setup.
Various methodologies such as data extraction, metadata, transformation and loading (ETL) are performed in data warehouse.
2) Business Analytics :
The combination of various applications, technologies, abilities and operations which are used for regular repetitive investigation and exploration of historical business performances is known as Business Analytics and it is used to have a clear view about the various inputs and forces of business planning.
For developing various on-demand reports, and analysis of data and queries, a number of software tools are available for the users. These are included mainly in online analytical processing (OLAP).
For example, vanous aspects of data and patterns can be evaluated by the users. Business users use graphing tools and trend analysis methods to evaluate quickly and easily the performance patterns.
Number of BI techniques and tools are available for the end users which can be segmented into following three categories :
i) Reporting and Queriesii) Advanced Analyticsii) Data, Text and Web Mining
3) Business Performance Management (BPM) :
The balance scorecard methodology is the basis of Business performance management of BI process. It can be seen as a setup of defining, executing and controlling the organization's business strategy by establishing a relationship between the factual methods with objectives. BI analysis queries and reporting are used by BPM. The optimization of comprehensive performance of an organization is the main objective of BPM.
4) User Interface :
There are mainly two types of user interface which are explained below :
i) Dashboards: Various information is organized and presented in a manner which is easy to understand with the help of dashboard. Various trends, exceptions and organizational performance measures (key performance indicators) are presented by these dashboards.
ii) Visualization Tools : The basic elements of BI system are different types of visualization tools including multidimensional cube presentation to virtual reality. Visualization includes the technologies similar to Geographical Information Systems (GISs).
Working of Business Intelligence :
Corporate database is used to store the various operational raw data.
For example : various kinds of data such as customer information, data about past marketing activities, inventory etc. is contained in a business organization which deals in almost everything ranging from grills and patio furniture to normal utensils.
Although all these information can be stored in different systems and there is no direct relationship among them, some special software can be used to combine all these data into a data warehouse.
Different tables can be connected with each other in a data warehouse and various data cubes (a type of multidimensional databases) are established.
For example : customer databases and sales statistics are connected to inventory information which can facilitate the rigorous analysis of information. There are some data warehouses which are connected to static databases while there are some which are connected to dynamic links.
Advantages of Business Intelligence :
1) Employees Authorization :
If the users are allowed to have a direct access to the uncomplicated data which can be understood easily and analyzed quickly, the performance can be improved significantly and all the business plans can be promoted if employees can process the data in various manners. In order to facilitate rapid and improved decision making by almost every employee of the organization, various healthy, lively business score registering, investigation, and reporting equipment are included by business intelligence.
2) Link Various Employees for Competent and Successful Processing of Data :
The decision making process has become quite simple because of the development of business intelligence. Data can be evaluated and accessed by the opinion leaders at certain places and time. One can get the latest information either directly on the user's system or over the internet.
3) Easy Teamwork and Allocation :
Managerial efficiency can be improved to a great extent using business intelligence and partnership expertise. The data sharing by employees with team members, associates and clients is supported through BI in a safer and administrated web environment. In order to monitor the KPIs (Key Performance Indicator), information evaluation, accessing the accounts, linking with the pertinent subject matter and sharing of various texts can be done with the help of a centralized site.
4) Communicating Business Intelligence to Whole Organization :
The requirement of an organization related to business intelligence issues can be supported by BI. The application of familiar tools can facilitate the uncomplicated premeditated planning and a more attractive expansion is possible.
5) Evaluate and Improve Inputs :
By implementing well known and accessible tools, employees can improve the insight with the help of fully integrated BI. The information can be evaluated and investigated effectively by the individuals when data is received easily. Different individuals interact with each other without any hindrances and smart business plans can also be made.
6) Improved Association :
An improved association is achieved in the entire organization through the business intelligence. The organizations can be benefited by the goals, pre-set objectives, expressive approach, supervising performance and taking effective decisions which can support the comprehensive business plans. Various accountability guidelines can be formed by administrators on a policy diagram and there can be a harmony between the organizational goals and individual goals of the employees.
7) Reduced Training Requirements :
Various information required by the employees can be facilitated by business intelligence. The training cost of an organization can be reduced significantly by implementing business tools which are easily accessible, common and extensively backed.
8) Transport Refined Investigation and Reporting :
The key performance indicators (KPIs) of the employees can be taken up voluntarily to accomplish the goals of the organization with the help of impressive scorecards (which are supported by account graphs, diagrams, assessments). A higher level of business performance can be obtained with the help of examining and accepting the relationship between the organizational goals and KPIs of the employees for ensuring the quick response of the organization.
Disadvantages of Business Intelligence :
1) Lot of Historical Data :
Collection of historical data of an organization's deals and expressing these data in such a manner that it helps the professionals in decision making process, are the main objectives of Business Intelligence System. On the other hand, this information is just a small part of the total information which is required by an organization apart from its controlled utilization. In fact in other circumstances, the significance of past data may not be much crucial for many users as there are regular modifications in the markets in which an organization functions.
2) Cost :
For small and medium sized organizations, business intelligence can be very confusing. When these applications are utilized for basic business transactions, the cost becomes quite expensive.
3) Difficulty :
The difficulty of implementing data can be considered as the other demerit of BI. The business techniques can be very stringent to tackle due to the difficulty of BI. Many business experts have the opinion that the business organizations can ultimately be suffered due to these difficulties.
4) Disordering of Commercial Set-ups :
There can be a very high degree of disorder in the commercial set-ups due to business intelligence.
5) Limited Applications :
The main reason behind the implementation of business intelligence was the purchasing capacity of rich organizations, same as the case with other improved technologies. Even now-a-days, there are many business organizations which are not able to afford business intelligence. Yet, many organizations have started altering their services towards small and medium sized industries. But due to its high level of difficulty, the necessity of BI is not so crucial for many business organizations.
6) Implementation is a Time Consuming Event :
In current fast paced business environment, most of the business organizations do not have such a patience to wait for the implementation of BI. For the complete implementation of the system by data warehousing system, time frame of almost 18 months is required.
Applications of Business Intelligence :
1) Measurement :
Some types of bench marking and hierarchy of performance metrics is developed by these programs which provides the information to the business leaders about the accomplishment of business objectives.
2) Logical :
It can be implemented in those programs which are used to execute Business Knowledge Discovery and establish the quantitative processes for an organization to determine an optimal decision. Generally, the techniques such as data mining, predictive analytics, business process modelling and statistical analysis are included in it.
3) Reporting Enterprise Reporting :
The infrastructure for strategic reporting for serving the strategic management of an organization rather than operational reporting is created by these programs. OLAP, Executive Information System and Data visualization are included in it.
4) Collaboration/Collaboration Platform :
With the help of Electronic Data Interchange and Data sharing, different fields (both within and outside the business) are combined together by these programs.
5) Knowledge Management :
The organizational data is derived with the help of various practices and strategies by these programs for creating, identifying, distributing, representing and enabling the acceptance of various insights and experiences which can be seen as the real business knowledge. Regulatory Compliance and Learning Management are resulted through knowledge Management.