By Pohan Lin – Senior Web Marketing and Localizations Manager #2:
Elements of running a successful business can feel invisible; you can look at profits, losses, and sales, but it’s not always straightforward to ascertain why the figures are what they are. What’s causing the drops or surges and where you should concentrate future efforts can feel like guesswork.
But if you aim to start boosting online sales, extend into a new market or pitch your marketing for maximum impact, drilling down into the data generated by your business is vital.
The way to gain the insights you need is to harness the power of business intelligence. Business intelligence, also known as BI, involves collecting data from various sources, analyzing that data, and presenting it in clearly accessible and usable formats such as spreadsheets or dashboards.
The aim is to show your team exactly what’s happening in terms of sales, customer service, or any other relevant area of your enterprise to help build your business so that it achieves the best possible results.
The kind of valuable insights that can be gained through BI includes identifying best-selling products and the most lucrative contracts and territories. But it can also reveal weak points, such as when low stock levels have led to a loss of sales or which goods and services are becoming less popular.
Business intelligence is crucial in identifying key performance indicators. It can save time and money and help a business focus and plan. Let’s look at what we mean by business intelligence in more detail.
What Is Business Intelligence?
At its most fundamental, business intelligence provides data that has a practical application, is actionable, and can inform business strategy. BI relies on gathering data from various points, both internal and external, to the business. A data pipeline helps centralize the collected information, which is generally then stored in a data warehouse.
Through the creation of data models which analyze the stored data sets, representations of the results that can be digested and understood, such as charts and dashboards, are made. It is these final presentations that a company can use to plot its future course, pinpoint flaws and weaknesses, and drill down into the reasons for and patterns of its successes.
Business Intelligence and Data Science, What’s the Difference?
If all this sounds somewhat similar to data science, that’s understandable; there are indeed crossovers between the two approaches. Undertaking business data analyst training would be invaluable for both disciplines. But there are certainly differences; let’s clarify them.
The most obvious difference is in focus. Business intelligence tends to answer questions about what has happened and is currently happening with a business. It gives vital information about what has worked well, what continues to work well and what doesn’t. This information allows business owners and managers to make an action plan based on these results.
Data science, or business analytics, on the other hand, tends to focus on data that allows predictions and projections to be made. The focus is to identify a business trajectory and decide on strategies accordingly.
Types of Business Intelligence
Data from business intelligence can help a company attain its commercial objectives, such as leading the digital market or boosting sales. But not all business intelligence is the same, and depending on what a business wants to achieve, the type of intelligence needed will differ.
Some intelligence is strategic; it will provide data that allows for forecasting, making plans, and forming strategies. It does this by optimizing the collected data, identifying business drivers, and answering key business questions.
Operational business intelligence, on the other hand, is much more immediate in its application. It’s less about graphs and projections and more focused on concerns such as what employees need to execute their work and provide good service to consumers.
Businesses don’t just rely on tools necessary to carry out everyday routine tasks like a virtual telephone system for answering customer queries and free electronic signature software for signing documents. They also rely on business intelligence tools that are used to gain insights from data.
Business intelligence tools include various types of software to mine, store, analyze, and report on data, such as Azure Databricks Elasticsearch. Data sources can access the business’s operational systems, such as supply chain management (SCM) and customer relationship planning (ERP).
Dashboards are another tool; these provide a way of accessing and seeing data which gives businesses a clear presentation of information upon which to base decisions.
Benefits of Business Intelligence
Business intelligence can be a valuable tool for any business, as with AI for small businesses its application can be beneficial no matter the size of the operation. There are several key areas where business intelligence can be of value:
Insights and Opportunities
Business intelligence can provide data that helps a business get a clear picture of areas such as productivity, performance, and profits. These insights can reveal strengths and weaknesses that were perhaps suspected but largely unseen without clear and extensive data. Knowing a business better through data can lead to fresh approaches and opportunities, and can give companies a competitive advantage.
Speed and Efficiency
Having up-to-date, easily accessible data can enable staff and management to act quickly; pivot, and change tack where the data highlights the necessity for a different course of action.
This frees up time for targeted action instead of managers and staff having to rely on trial and error to identify ways to grow the business and improve service and efficiency. As well as these advantages, this type of technology can reduce costs, as it’s a way of identifying and allocating where resources are needed most.
Consumer Contentment and Profits
Providing customers with what they want and building consumer loyalty relies on accurately assessing their needs and buying behavior. Business intelligence is invaluable in determining through data what customers like and don’t like and how those preferences might evolve and change.
As well as keeping customers happy, the aim is to keep them spending. Business intelligence can help identify revenue gaps and guide businesses on where to invest and expand to increase profits.
BI Best Practice
To make the most of business intelligence, it’s important to plan and set clear objectives. Decide what information is most valuable to your business and create an action plan based on this. It’s vital to ensure your performance indicators are well-considered. The worst outcome for any company using business intelligence is that it doesn’t produce helpful enough results that concretely help the business.
Make sure you have a team to cover the various roles within business intelligence. You might need data mining experts, analysts, database administrators, and project managers. You will also need specialist software such as the extract transform load process to handle and store the raw data.
Another consideration is which data storage option is the right fit for your company’s budget and needs. Data warehouses can offer incoming data analysis and can be cloud-based, in-house, or a hybrid version.
Business Intelligence: The Way Ahead
Technology for business is ever-evolving and expanding, from the benefits of a contact call center to chatbots for customer service. Business intelligence is another area where technology drives efficiency and streamlining business practices.
The way ahead for business intelligence is to become increasingly more collaborative, enabling more teamwork and user interaction. If teams beyond the tech specialists responsible for the data can interact with it and use the information gathered, the potential benefits will be far greater for companies.
This seems to be a natural direction in which business intelligence will evolve. Although, this will depend greatly on having user-friendly dashboards and accessible and clear presentation of data.
Greater integration into wider business systems is another direction business intelligence will certainly take, with data connected to broader company networks. This includes the capacity to allow interfaces with existing company systems. Machine learning is also appearing in data gathering and analysis; ever more intuitive forms of business intelligence, with the ability to predict questions and tailor analysis to individual needs are currently being developed.
Of course, it’s impossible to talk about data collection and especially storage without mentioning cloud-based systems like cloud erp. Business intelligence elements such as data models could easily become cloud-based. Having data in a cloud environment avoids the high cost of physical hardware and infrastructure, and it enables greater connectivity between teams in different locations that might need access to data.
Business intelligence will become more accessible and user-friendly and this will go hand in hand with users themselves becoming more skilled, with more extensive knowledge of how to access and understand data.
But companies will need to take on the responsibility for training and education. A workforce that is not only familiar with business intelligence procedures and systems, but who can help drive the innovation of more sophisticated ways to use data will mean businesses making full use of business intelligence’s potential.
This technology is leading to a future where businesses are more self-aware and nuanced in their targeting of activity and the allocation of resources. Business intelligence allows businesses to work smart, armed with information that data can provide.