How Business Analytics Works

January 17, 2018 Author: rajesh
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Every business is dynamic in nature and is affected by various external and internal factors. These factors include external market conditions, competitors, internal restructuring and re-alignment, operational optimization and paradigm shifts in the business itself. New regulations and restrictions, in combination with the above factors, contribute to the constant evolutionary nature of compelling, business-critical information; the kind of information that an organization needs to sustain and thrive. Business Intelligence (“BI”) is broad term that encapsulates the process of gathering information pertaining to a business and the market.

What is Business Analytics?





Business intelligence (BI) has two basic different meanings related to the use of the term intelligence. The primary, less frequently, is the human intelligence capacity applied in business affairs/activities. Intelligence of Business is a new field of the investigation of the application of human cognitive faculties and artificial intelligence technologies to the management and decision support in different business problems. The second relates to the intelligence as information valued for its currency and relevance. It is expert information, knowledge and technologies efficient in the management of organizational and individual business. Therefore, in this sense, business intelligence is a broad category of applications and technologies for gathering, providing access to, and analyzing data for the purpose of helping enterprise users make better business decisions.

Business Intelligence (BI) is a vital subject that covers a vast area of interest for today’s businessman. BI consists of both internal and external categories that deal with the ability of a company to determine what its competitors are doing as well as understanding what forces may be at work against them. Finally, how does your business incorporate the data that it collects into useful information yielding a competitive advantage? The field of BI is frequently murky and can easily cross the confused boundaries of business ethics as well as federal law. Using current academic literature, case studies and an interview with a BI provider, we have outlined the key aspects of BI that your business needs to understand in today’s competitive environment.

Business Intelligence Cycle

Figure 1: Business Intelligence Cycle

Defining Business Intelligence





The term Business Intelligence (BI) refers to technologies, applications and practices for the collection, integration, analysis, and presentation of business information. The purpose of Business Intelligence is to support better business decision making. Essentially, Business Intelligence systems are data-driven Decision Support Systems (DSS). Business Intelligence is sometimes used interchangeably with briefing books, report and query tools and executive information systems.

“Business Intelligence is the art of gaining a business advantage from data by answering fundamental questions, such as how various customers rank, how business is doing now and if continued the current path, what clinical trials should be continued and which should stop having money dumped into!”

With a strong BI, companies can support decisions with more than just a gut feeling. Creating a fact-based “decisioning” framework via a strong computer system provides confidence in any decisions made.

Business Intelligence (BI) is a set of methodologies, processes, architectures, and technologies that transform raw data into meaningful and useful information which can be used to enable more effective strategic, tactical, and operational insights and decision-making. Within this are included a variety of technologies, including data quality and master data management.

Business intelligence Examples





Business intelligence (BI) is the use of data analysis in taking strategic decisions in the business environment. This definition might seem somewhat abstract if it is not illustrated with some concrete examples.

Stock Optimization

Sectors with a pronounced seasonal business cycle often find it very difficult to optimize their stock. For example, if sales of particular product shoot up in summer or at Christmas, it is a big challenge to store the right amount of stock in order to maximize profit.

To address this issue, some companies in the canning, preserving and general food sector have been able to increase profitability by nearly 10% using BI techniques based on:

  • The adoption of a decision support system (DSS).
  • The exhaustive analysis of historical sales and stocktaking data for warehouse products.

In many cases, the results obtained have made possible a much more efficient and profitable redesign of the entire logistical and productive warehousing process.

Increasing Customer Loyalty

Business intelligence processes are also very useful for identifying the most profitable customers of, for example, a supermarket or clothing chain, who can subsequently be brought into loyalty schemes.

To do this, a great deal of data must be correctly analysed in order to find the ideal profile: age, sex, geographical location, marital status, number of children, etc. A good way of obtaining this information might be the creation of “discount cards”, where in exchange for a card; the client has to provide a range of personal details.

Detecting and Correcting Budget Deviations

There are plenty of companies, especially large ones that are affected by significant budget deviations, discrepancies between the estimated operational parameters and targets set at the beginning of the year, and the actual results produced twelve months later.

An analysis of the strategic objectives of the company itself by means of a Balance Scorecard can quickly detect the reason for these deviations and enable their rapid correction. Sometimes, the problem might be a mismatch between a company’s advertising and marketing operations and its real needs.

Problems for Small Businesses

The view that BI is only of any use to large companies is as widely-held, as it is wrong. Simple business intelligence systems can be of great help to small businesses in deciding, for example, what the best opening hours are, or what day of the week is best to take off.

Business intelligence Vendors

The BI market is in constant flux. New vendors frequently appear, and just as frequently disappear or become acquired by a larger company. Following are the BI Vendors are listed here:

Cloud-based 1010 data provides big data discovery options within the same location where it is stored, speeding up important business decisions by giving all users easier, quicker access requiring fewer clicks.

Actuate’s BIRT business intelligence software, known for its focus on open source, utilizes an Eclipse platform to streamline reports help generate useful insights with three unique types of reporting tools.

Alteryx’s BI platform is powered by a unique data blending capability which seamlessly unites cloud data, third party data, and internal company information, creating a smoother, more efficient workflow.

Arcplan offers their customers two platforms as a way to deliver Business Intelligence functionality – the Enterprise platform and engage platform, and can integrate with other BI tools.

Birst’s BI solutions include a wide variety of features, such as big data, data warehouse automation, and data mashups. Users can choose between two platforms based on their needs.

References

[1] Dejan Zdraveski and Igor Zdravkoski, “Business Intelligence Tools for Data Analysis and Decision Making”, available online at: file:///C:/Users/maxtech-10/Downloads/cks_2011_economy_art_006.pdf

[2] Jayanthi Ranjan, “Business Intelligence: Concepts, Components, Techniques and Benefits”, Journal of Theoretical and Applied Information Technology, Volume 9, Number 1, pp 060 – 070, 2005-2009

[3] Greg Nelson, “Introduction to the SAS® 9 Business Intelligence Platform: A Tutorial”, In SAS Global Forum. 2007.

[4] Captio, “Some practical examples of the use of business intelligence”, available online at: https://www.captio.com/blog/some-practical-examples-of-the-use-of-business-intelligence

[5] Justin Heinze, “The Ultimate List of Business Intelligence Vendors”, available online at: https://www.betterbuys.com/bi/business-intelligence-vendors/

4 Comments

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