What is Business Intelligence (BI)?
Business intelligence (BI) is a buzzword that has been around as long as companies have sought to use data for competitive advantage. Forrester indicates it’s a more than $20 billion market with almost 10 percent year-over-year growth.
There are several BI tools that provide key performance indicators (KPIs), metrics, and numerical information about how businesses are performing. Many involve aspects of artificial intelligence (AI), data visualizations, and dashboards to deliver insight from all the data organizations have.
Some companies have dedicated teams using these tools to provide strategic direction for specific departments. But chances are, unless you’re a data analyst or work for IT, you’re simply wondering what is BI – and what exactly can it do for you?
According to Gartner, BI is a means of analyzing data to understand its significance in relation to business objectives. It involves reporting, search, and other techniques to find trends in the information that reveal what actions employees can immediately take to meet departmental goals such as boosting sales.
BI tools can analyze whatever data is relevant to a specific departmental user. E-commerce teams can use them to evaluate which markets are performing best and for what products; financial companies can leverage them to determine how market trends impact investment opportunities. There are few limits to the type of insights BI can produce, which is why they’re increasingly used throughout enterprises today.
Common BI tools
BI platforms involve an array of different toolsets to enable end users to leverage data to do their jobs better. Common BI tools include:
- Dashboards: Dashboards are usually centered around KPIs such as different sales tallies, individual employee productivity, and others. They offer a centralized place to view data according to these metrics so employees can note at a glance –how they’re doing, where they need to improve, and which areas to emphasize to meet departmental objectives.
- Reporting: Reporting capabilities detail information about specific queries. Users might want to know in which markets a certain product is most frequently coupled with a particular service. Reports provide this numerical information; modern BI tools use AI to explain what those numbers mean. Other AI techniques are used to forecast results for future trends.
- Data visualizations: This element illustrates the predominantly numerical information found in reports and dashboards. Visualizations involve different colors, shapes, and charts to show users in a pictorial format how the business is performing. These images are often more convincing than mere numbers are.
- Search: Natural language search capabilities enable users to dynamically interact with data sources by simply typing in questions in everyday conversational terms – as opposed to writing queries with code.
Business intelligence benefits
There are numerous advantages to evaluating departmental or organizational metrics with BI toolsets. The most important is they put data in the hands of the users that need it most to work better. The function of business intelligence is to deliver this information in an increasingly self-service way so that front-office employees are no longer dependent on IT teams for it.
With these capabilities, end users can slice and dice data as needed for insights indicating their next best course of action – which is otherwise difficult to tell. Many tools in this space recommend the next best actions based on machine learning results.
BI also clarifies what strategic approach organizations should take to maximize their goals. Without this information, it can be difficult to learn which products resonate with which customers and why. These tools can answer each of these questions, which are timely for developing new products or features to excite customers.
For managers, these capabilities can maximize employee output by enabling them to measure the impact of their efforts – providing a smooth path for intelligently going forward. It’s also a great means for evaluating employees to reward those that are effective and help those with room to improve.
The key to insights
The role of business intelligence is to consistently translate data into the insights necessary for users to achieve departmental objectives, such as increasing revenues. Its various tools spotlight important data trends with a combination of verbal, numerical, and pictorial approaches implying timely actions for realizing goals. These techniques are essential to profiting from data, improving the decision-making process, and acting to produce tangible results.