MENU
GET LISTED
GET LISTED
SHOW ALLPOPULAR CATEGORIES

What Is The Use Of BI?

Category: B2B News

What is BI (business intelligence)?

Business intelligence (BI) is a process involving the analysis of data wherein the results are used by business and corporations to make informed decisions. The breadth and reach of BI comprises strategies, processes, methodologies and technologies to support data collection and analysis as well as business information presentation and dissemination. With BI, businesses are able to source data from within and from outside their organization, subject data for analysis and run queries against it, and generate data reports and visualizations for corporate executives, department managers, teams and other end users.

What is the use of BI?

BI analysis provides corporate decision makers with actionable information to pursue both operational and strategic goals. As such, BI technologies are designed to handle and interpret big data, whether structured or unstructured, in order to identify and develop new business opportunities. Likewise, BI can go over and analyze financial records and operational statistics to identify areas that need improvement. Moreover, BI has a most useful goal management function that allows managers to program data according to goals set on a day-to-day basis. These goals could be financial objectives, sales targets, marketing aims or productivity measures.

Additionally, BI can integrate some forms of advanced analytics (e.g. data mining, predictive analytics) but mostly these are managed by separate teams of data scientists, predictive modelers and statisticians. On the other hand, BI programs are handled by IT teams for typical data collection, analysis and query as well as creation of reports. Lately, the availability of easy-to-use business intelligence platforms allowed end users like corporate executives, business professionals and employees to use BI programs directly for themselves.

The question “what is the use of BI” can best be answered by its many functionalities and capabilities that include:

  1. Analytics – the cornerstone of BI is the discovery, interpretation and communication of relevant and useful patterns in data. Analytics may rely on descriptive, prescriptive and predictive approaches as well as statistics, computer programming and other methods to come up with meaningful data that can describe, predict, quantify and improve business performance.
  2. Reporting – one of the hallmarks of BI programs is the rich visualization of the resulting insights and reports after data has undergone analysis. These reports can be charts, graphs, presentations and infographics, all designed to provide the user essential information that can be acted upon or decided on.
  3. Complex event processing – this combines data from various sources to identify significant events or things that happen across the organization. Whether they are threats or opportunities, CEP gives businesses the chance to respond accordingly.
  4. Data mining – BI supports data mining techniques in order to transform raw data into useful information. Oftentimes, BI programs source data from data warehouses which already store consolidated information. BI comes into focus on analyzing the data.
  5. Process mining – special algorithms are applied on event logs recorded by an information system to identify trends and details in order to improve process efficiency.
  6. Text mining – involves extracting pertinent patterns and deriving high quality information from text sources which are then analyzed by a BI program.
  7. Benchmarking – BI applies this method to measure business performance through a specific indicator (time, quality or cost) the result of which is a performance metrics that is compared or benchmarked with the best practices of other companies or the level of standards in a certain industry.
  8. Business performance management – BPM activities especially in large businesses and organizations involve large data that require collation, analysis and reporting, areas that BI programs are built to handle.

If you need more information on what is the purpose of business intelligence in a business check out our other article on that topic.

What business decisions can BI support?

Enterprises can gain insights from BI to help in tactical and strategic decisions. It must be understood that “intelligence” is most effective when data is collected from various sources – internal (corporate operations and finance data), external (customer information, market situation) – in order to derive a complete, consolidated view of what’s happening within and around your business and the landscape it is in. Armed with insights, decision makers can identify new and emerging opportunities and plot effective strategies to provide the business with a competitive advantage and long-term stability. Examples of areas where BI can support and guide businesses in important decisions include:

  • Pricing
  • New markets
  • Market segmentation
  • Marketing campaigns
  • Product demand
  • Product positioning
  • Sales goals
  • Suitability of products and services
  • Resources deployment
  • Corporate productivity and performance
  • Corporate priorities and directions
  • SWOT (strengths, weaknesses, opportunities and threats)

What is the difference between BI and business analytics?

Business intelligence and business analytics are often used interchangeably since both involve collecting and analyzing data and use predictive analytics to create highly visualized reports. The similarities end there. While BI optimizes and streamlines current operations through its powerful reporting and data analysis mechanisms that generate visual reports consisting of actionable information, business analytics on the other hand explores and analyzes previous and current data through data mining, statistical analysis as well as quantitative analysis. It does these to pinpoint past business trends and predict future business situations. Essentially, business analytics employs advanced predictive analysis to identify issues before they happen.

Although BI and business analytics have the same goal of enhancing a company’s viability and efficiency by using data analysis, they perform different functions in a business. BI is all about compiling and accessing big data and extracting insights, while business analytics is about forecasting upcoming developments based on all those past and present data in order for a business to be prepared for new challenges. Although BI and BA have defined roles with the former telling you what happened and what’s happening and the latter predicting what will happen next, businesses usually utilize both to cover all possible opportunities and eventualities in an ever changing market environment. 

What are real-world applications of BI?

More and more companies are discovering the advantages of business intelligence software as the need and use of data analytics grows. If you are still unclear on what is the use of BI, here are concrete examples of industry segments where BI has gained a foothold and is increasingly being utilized.

  1. Retailers – BI can use segmentation to differentiate the types of customers such as those who purchase small quantities but do so often, and those who spend big but do so rarely. Having such data will enable retail business owners to decide who are entitled to loyalty awards (the former) and who should get win-back offers (the latter).
  2. Supermarkets – BI helps in gathering comprehensive data about customers and shoppers to determine who may be candidates for promotional offers. For example, pregnant moms can be targeted for discounts on diapers or baby items.
  3. Service Providers – Utility companies use BI to predict when a customer will likely transfer to another service provider by collating billing information, website visits, customer inquiries, and other such metrics to give each customer a probability score, then offer incentives to customers perceived to have a higher risk of transferring.
  4. E-commerce – You have probably come across Amazon’s line “People who viewed that product also like this…” which is a BI-driven, data mining method to promote cross-sells and up-sells. This is a popular technique in online selling sites.

Why should your company use BI?

With a host of functions and a distinct role, BI brings immense benefits for your business. Typical BI solutions allow you to do the following:

  • Enhance decision-making
  • Increase operational efficiency
  • Improve internal business processes
  • Measure corporate performance
  • Generate new revenues
  • Gain competitive advantage
  • Identify market trends and directions
  • Spot business problems
  • Prepare for future challenges

Although the above examples may be too general in scope and circumstance, each can have a profound and lasting impact on your business. Itemizing specific advantages of BI for your company may need another article. Suffice to say that business intelligence will permeate and influence every aspect of your business processes – sales, marketing, management, administration, operations, performance, targets, directions – simply because each of these areas require large data that need to be collected, filtered, analyzed and known by key people who decides the what, when, who and how to keep your business healthy and profitable.

What are the best BI tools?

Business intelligence combines many different methods for data analysis and various means for reporting. These tools for analytical processing and enterprise reporting can be acquired separately and are available as specialized programs. However, several platforms have come about that offer all-in-one solutions in a single package. We go over some of the leading applications that carry essential BI capabilities.

  1. Sisense – a multi-awarded BI tool that allows users to analyze and extract useful information that makes possible more intelligent business decisions. It can unify all data into visually appealing reports, turn valuable insights into interactive dashboards, and then share them among decision makers and stakeholders. You can easily sign up for Sisense free trial here.
  2. Samanage – a highly acclaimed on-cloud customer support platform that specializes in managing, monitoring and controlling corporate assets as well as helping end-users resolve issues via a knowledge base. Its strength lies in its ability to process large data and analyze insights relating to your assets so as to optimize your support services.
  3. Zoho Reports – this popular BI software in the line-up of Zoho productivity tools has powerful and comprehensive analytics and reporting functions to provide businesses with meaningful insights. It supports a wide array of report creation options such as charts, pivot tables, tabular views, summary views, and dashboards.
  4. Looker – a web-based data discovery app that provides business users an intuitive approach to data exploration. It enables the quick building and sharing of reports, so that users can benefit from the questions they’re asking and the knowledge they’ve created. It can analyze data of all sizes and permit real-time access to data.
  5. Tableau – an advanced business intelligence system that helps companies visualize and understand their data through a self-service analytics tool. The app can connect to a number of data sources and visualize data in a matter of minutes. It boasts of the fastest operation when it comes to data analysis.
  6. GoodData – provides advanced analytics for driven companies to create new revenue streams. Its strength is helping marketers and independent software vendors understand their clients’ behavior and needs. What is more, GoodData provides valuable marketing analytics to understand your clients’ buying journey, boost the return on investment of multi-touch nurture campaigns, and utilize social analytics to link your company’s advertising expenses to revenue. You can find more information about GoodData alternatives here.

Is BI something for you?

If your company is using systems for customer relations, project management, inventory management, data mining or any other business optimization apps, a BI platform is an important addition that can complement and support all your other tools to keep your business in tip-top shape. In today’s competitive business environment, you need all the help you can get to stay on top of the game, and a BI tool will come in handy to keep you informed and guided in your crucial business decisions.

By Nestor Gilbert

Senior writer for FinancesOnline. If he is not writing about the booming SaaS and B2B industry, with special focus on developments in CRM and business intelligence software spaces, he is editing manuscripts for aspiring and veteran authors. He has compiled years of experience editing book titles and writing for popular marketing and technical publications.

Related posts

Leave a comment!

Add your comment below.

Be nice. Keep it clean. Stay on topic. No spam.

TOP

Why is FinancesOnline free? Why is FinancesOnline free?

FinancesOnline is available for free for all business professionals interested in an efficient way to find top-notch SaaS solutions. We are able to keep our service free of charge thanks to cooperation with some of the vendors, who are willing to pay us for traffic and sales opportunities provided by our website. Please note, that FinancesOnline lists all vendors, we’re not limited only to the ones that pay us, and all software providers have an equal opportunity to get featured in our rankings and comparisons, win awards, gather user reviews, all in our effort to give you reliable advice that will enable you to make well-informed purchase decisions.