What is Business Intelligence?
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Business intelligence helps companies run smoother, analyze weaknesses and find growth opportunities. In this post, we look into why business intelligence is beneficial, careers related to it, and more.
Business intelligence is software that businesses use to help them run smoother.?
“[It] allows people to make better strategic decisions around their business,” said Insider Intelligence director of marketing and commerce briefings Jeremy Goldman .
The term was first used in 1865 by author Richard Millar Devens, when he “cited a banker who collected intelligence on the market ahead of his competitors,” according to IBM .?
The first data management systems and decision support systems were developed in the 1960s and 1970s to store and organize growing volumes of data.
“B.I. used to be referred to as tools developed to extract data from ERP [enterprise resource planning systems],” said Qlik executive vice president of global sales Steven Birdsall . “Companies like Cognos and Hyperion existed essentially for the sole purpose of pulling data out of an ERP system.?
“It [later] expanded into areas outside of ERP – market data, CRM [customer relationship management] data, supply chain data, workforce data, things like that. The term B.I. kind of evolved at that point to include all facets of the enterprise, all functional areas of the enterprise and the consolidation or application of the data to be used by a business leader in that respective, functional area in order to run the business.”?
I chatted with Birdsall and Goldman to learn more about business intelligence, how companies use it, and why they find it beneficial.?
How Companies Use Business Intelligence?
Numerous competitors populate the marketplace, and companies must use business intelligence to level up.
“[When companies use BI], you have better information at your disposal about your business,” Goldman said. “You can learn faster about what works and what doesn't work. If you can provide yourself with the right insights, you can make better decisions than somebody else who is staffed in the same way, who has the same resources, who is just as smart.?
“You are giving yourself a major competitive advantage over everybody else in your field.”?
Companies find business intelligence attractive because it “spans the breadth of all different lines of business,” Birdsall said.?
“So regardless of the application, there is data that goes into those applications, and you want to extract that out and then use that across all of the lines of business. If you do business planning or financial planning, or you are building out process mining, or those types of specific vertical applications, you are able to do that effectively because you have the information through the data extraction of all those different applications.”
Types of Business Intelligence
In addition to helping you make better decisions about your business, business intelligence can also analyze opportunities, and discover weaknesses within your business structure, Goldman said.?
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Three types of business intelligence are data warehouse, business analytics and business performance management and user interface.
“Data warehouses hold data obtained from internal sources as well as external sources. The internal sources include various operational systems,” according to Management Study Guide .?
“Business analytics creates a report through queries and rules. Business performance management is a linkage of data with business objectives for efficient tracking.”?
Data architecture and data governance also are major components of business intelligence, Goldman said.?
“If you are having ongoing calls with clients and you need to be able to rank their satisfaction with a call or what category they were talking about, how do you decide what those satisfaction levels are?” Goldman said.? Are there five levels? Are there 15 levels? And for the categories, are there six categories? How do you call those categories?”?
“The governance is, ‘Do you have tools in place to essentially validate data?’ So, if somebody inputs some data incorrectly does it force you to fix it? Or does it allow an error to go into your data set? These types of things seem super nerdy and super boring until it's time to make a decision. And then you can't make a good decision because 17% of your data was input incorrectly. And you've got less confidence that you are making the right decision by virtue of the fact that you didn't have the right structures in place from the outset. “
Training You Need If You Want to Pursue a Career in Business Intelligence?
Business intelligence careers include a wide range of roles, including business analysts, customer analysts, data analysts, data engineers, economists and statisticians, according to Wake Forest University School of Business .?
Several training options are available if you want to pursue a career in business intelligence, and the nature of your college degree doesn’t make or break your chances.?
“There's a ton of training,” Birdsall said. “They typically don't have a college degree for B.I. but there are certifications that companies provide [like] master's level certifications.”
You will need hard and soft skills to be successful in the field, according to WFU.
“Technical proficiency in the software types such as database user interfaces like those that accompany Microsoft Access and ERP software like Oracle PeopleSoft, with a heavy emphasis on Structured Query Language (SQL), are recommended.”
Business intelligence also requires soft skills such as critical/analytical thinking, attention to detail, deductive and inductive reasoning, and active listening and learning.
WFU also recommends knowing “regression (using statistical models to estimate what factors influence a particular outcome), forecasting (extrapolating historical data to do trend analysis), and factor analysis (determine which variables have the most impact)” for soft skills.
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What is Business Intelligence?
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1 年BI can provide significant benefits for companies seeking a competitive edge by analyzing and presenting data effectively. However, flawed data quality, privacy, and security issues can pose challenges to BI. Companies must use BI responsibly and comply with relevant laws and regulations while gaining insights into customer behavior, market trends, and operational performance to make better decisions.