Overview of Business Intelligence
Business intelligence (BI) is the process of achieving data from a data warehouse to produce business reports and analysis. It enables companies to decrease their information technology structure costs (e.g., hardware costs, software costs, human operation costs) by removing redundant data. BI tends to solve problems in an organization with enormous data, but there is insufficient information from the data. Thus, it helps save time because it delivers what users want precisely. As can be seen, business intelligence tools allow managers to make better decisions by identifying the company’s needs, asking and answering the right questions, delivering reliable analysis, and eliminating unnecessary information.
There is a relationship between data, information, business intelligence, and knowledge. While data are raw facts that describe an event or object’s characteristics, information is the data converted into a meaningful and useful context—the difference between the two dwell on the fact that computers need data, and humans need information. The collected information from multiple sources analyzes patterns, trends, and relationships that strategic decisions are made. Without BI, organizations cannot adapt to changes in the business environment. For example, without analyzing the information, businesses may not be able to assess their internal strengths and weaknesses and the competitors’ strengths and weaknesses.
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Advantages of Business Intelligence Tools
Challenges of collecting information, discerning patterns, and meaning in the information and response are normally cited as the cause of business failure. High-quality information with the characteristics of accuracy, completeness, consistency, timely and unique are collected can lead to accurate analysis of the information to identify patterns and trends and therefore lead to high-quality BI to help management in strategic decisions business growth. For instance, businesses should be aware to facilitate information technology in terms of business intelligence to encourage strategies and international operations that will finally support business growth.
There are notable advantages of using BI to support managerial decision-making. BI helps turn information into actionable knowledge. Managers can use BI to have complete business perspectives regarding their company’s history, present, and future. There are three examples of how managers may benefit from BI. Firstly, historical perspectives in terms of performance may help predict important variables for determining future trends and patterns. Secondly, the current business situation may allow managers to solve issues before they grow out of control effectively. Thirdly, planning, and creating business strategies may be done to guide the organization into the future.
Despite the accrued advantages of BI, most organizations still experience a lack of BI in their decision-making processes when implementing enterprise systems, such as Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), and Supply Chain Management (SCM). BI can be used effectively to help in making strategic decisions with the use of support tools.
Demand for Business Intelligence Tools
Organizations should use BI tools and techniques to help them in making decisions. BI tools utilize a set of methodologies and technologies to prepare, present, and help analyze data. Management should use tools and techniques of business and competitive intelligence to make the right and quick decision. Information on the organization, acquired through business intelligence techniques, and information on the competition, acquired through practicing competitive intelligence, presents a basis for making the right business decisions, leading to its established business goals. BI applications can analyze large volumes of data required to be processed to reach full and useful reports for negotiation between the partners involved in business agreements.
Some problems occur in implementing BI technologies, and transactional processing systems have to ensure that they meet the business executives’ information needs. Normally this is not the case. For instance, information architecture using data warehousing, online analytical processing (OLAP) tools, and data mining can provide a more agile means of meeting the executives’ needs. Proper BI tools are needed to help in analyzing the information to help management with the correct decision. BI tools simplify the presentation of needed information for discussions and provide a foundation for joint analysis of economic dynamics to reach complete and actual lines of possible future cooperation.
Top Trending Business Intelligence Tools Example
There are eight main business intelligence tools. Choosing the right BI software tools is not simple, and it is important to the company’s success. The eight main tools can be split into two categories: the first half is commercial software programs (Cognos Analytics by IBM, Power BI by Microsoft, Oracle Business Intelligence Suite Enterprise Edition and MicroStrategy), and the other half is open source tools (Jaspersoft Business Intelligence Software, Vanilla – Analytics Business Intelligence, Pentaho Business Analytics Platform, and SpagoBI Open Source).
These business intelligence tools provide warehouse capacities (data integration and transformation from different sources) to companies and the abilities for the end-users to retrieve, analyze, and convert business data for business intelligence purposes. They often offer dashboards where users can see information summaries and the current state of their business. The users can share and work together with others. The business intelligence tools can be cloud-based or desktop-based, depending on the needs of the companies.