Although businesses have been using intelligent computer systems for many decades now, big data analytics have completely transformed the field. Business intelligence tools allow you to collect, manage and analyze data to make informed business decisions. The age-old concepts of probability, statistics and flowcharting, can be perfected to their minutest accuracy with terabytes of data. With simple decisions like which color T-shirt a consumer purchases after having purchased a red T-shirt to what impact a new highway project in Texas is going to have on the steel industry in South America in the coming two years, business intelligence gives you unprecedented insights with indisputable clarity.
What is business intelligence?
According to the definition present on the CIO website, “Business intelligence (BI) leverages software and services to transform data into actionable insights that inform and organizations business decisions.”
Business intelligence, when it exists in the form of software, is a set of processes, architectures and technologies that convert your raw data into meaningful insights and bits of information that can help you take profitable decisions and actions. It can have a significant impact on your strategic, tactical, and operational capabilities. It facilitates fact-based decision-making using historical data.
Most of the business intelligence tools are used for data sourcing (inter-and intra-organization data), data mining and analysis, risk assessment and finally, decision-making.
Business intelligence does not tell you what actions to take in case there is a problem. It tells you what’s the problem and what might be the root cause of the problem. For example, if your supply chain is being plagued by delays, business intelligence can tell you where the delays are happening in the shipping process. Then, once you know where the problems are originating, you can deal with them.
Most of the problems in business happen due to lack of information. The decision-makers don’t know why things are going wrong and even if they know eventually, it may take months or even years to know them and that too, by a tedious and costly trial and error process. Capable business intelligence tools can give you this information in minutes. Of course, to draw intelligence, lots of data must exist.
The BI tools use the data that you have generated over months and years. It also uses data from external sources. It analyzes the data and then presents to you business insights in the forms of reports, predictions, summaries, graphs, dashboards and other forms of output to help you make advanced business decisions. Efficient business intelligence software tools mitigate risks and increase opportunities.
Transforming data into business insights
The volume data collected by businesses all over the world doubles every 1.2 years. With advanced technology, the volume of data is predicted to increase by 85% every year, across all the major sectors.
It is your data that fuels business intelligence. Different business intelligence solutions are increasingly using artificial intelligence to unleash the power of hidden insights that reside within tons of structured and unstructured data. The intelligence obtained from this data can help you predict and shape future outcomes, empower your employees to deliver higher-value work, create intelligent workflows for meaningful automations and ultimately, even help you create personalized business models for individual customers and clients.
In the contemporary world, whenever you talk of business intelligence, it is a technological synthesis of software, hardware, data and personal skills. There are numerous BI tools for your individual requirements that can help you analyze, manage, and protect various business outcomes.
Traditional databases no longer work. Despite connected and relational databases becoming the norm of the day by the late 1990s, businesses all over the world are still handicapped by incorrect, inadequate, disconnected, and misleading data. Specialized BI solutions are needed. The problem with traditional databases is that there are no across-the-board applications to access data residing in various silos and then create collective intelligence. Your marketing department may not be sharing data with your accounts department and your accounts department may not have access to the appropriate production reports and your human resource department may be working through an entirely different tangent.
The data is often inconsistent. It is invalidated. Integration is missing. BI solutions can completely transform the way you used data to grow your business.
A business intelligence tool extracts data from your corporate database and other related sources, reformats it, refines it, cleans it and then saves it in a format that can be used for meaningful interpretations and analysis. Once the data is cleaned and formatted, you can run advanced queries and the most advanced information becomes available at your fingertips. Events that seem like depending on chance begin to appear predictable and controllable.
How do you choose the right business intelligence tools for your business
With an increased penetration of technology and the subsequent advancement, most of the BI tools provide you more or less the same functions at the fundamental level. What differentiates them? The finer details. Listed below are some considerations to keep in mind when going for the most appropriate BI tool for your business:
- Ability to integrate: You must already have legacy applications with massive amounts of data. You would prefer a BI tool that easily communicates with your enterprise solution, accesses its data and provides you intelligent insights.
- Ability to go mobile: Most of your business leaders would like to use your business intelligence tool from their mobile phones or tablets. Mobile apps coupled with cloud-based data storage are pretty much a default for every competent business intelligence tool.
- Security and privacy: This must be the most important aspect of your business data. While information is being accessed and analyzed, it needs to be kept safe from the prying eyes. Hence, it is essential for a business intelligence tool to provide world-class security to your data.
There is a constant pressure on businesses to innovate. Competition is constantly on the rise. Many businesses existing in physical form until a few decades ago have been digitized (media, music, food delivery and even taxi service). These developments have demolished barriers to entry and consequently, there are multiple options available to customers and clients. Business intelligence tools are going to play an increasing role in business administration, customer service, growth forecasting, innovation, marketing and product design.