What is Business Intelligence (BI)?
Business Intelligence (BI), in a nutshell, is gathering and analyzing a business’s data, using computers, to answer certain questions about the business. It is used for decision-making, tracking, benchmarking, and strategic planning.
It’s data science, for business, and the term itself refers to a software product that coordinates and completes the process for users.
Is Business Intelligence the same as AI?
No - although the two can have overlaps. AI is software that mimics elements of human intelligence. While there may be AI aspects involved in a BI software product, this isn’t always the case.
When was Business Intelligence invented?
The term Business Intelligence dates back to the 1800s. During this period, it was found that data gathering and analysis (by pen and paper) was found to be more successful in predictive banking than an educated guess
The more modern definition of Business Intelligence was described in a 1958 paper, ‘A Business Intelligence System’ by H.P. Luhn. The paper describes a system that consumes documents, then automatically distributes them to different audiences based on the content.
Where can BI help businesses?
Business decision making
Instead of going a gut feeling or simply looking at one chart, BI software can combine multiple data points to help businesses in decision making. For instance, , or when to hire new employees to cope with incoming demand.
With a more informed view of financial flows and projections, financial planning can be more reliable. This could include things like helping decide whether the profit/loss balance sheet will be stable in the next two quarters to support opening a new site, or how much to payout to shareholders this current year.
Understanding customers better
Whether it’s marketing feedback loops, product sales, or lead conversions, when fed the right data, BI platforms can tell you more about your customers’ wants and needs. This could include whether the number of touchpoints influences customer value, or natural customer segmentation based on their collected demographics.
BI can be used to uncover hidden operational efficiencies, for example planning for machinery downtime, allocation of employee hours, oridentifying current bottlenecks in your product or service rollout.This in turn can improve profitability.
Why do we need BI?
Every organization should be looking into getting a BI solution (or solutions) for their business. Why? Because the right software can help across all aspects of the business - from sales, to HR, management, operations, security - everywhere.
As more and more organizations pick up BI solutions, it’s going to be important to keep up or the competition will move ahead of you. Finding optimizations, identifying new opportunities, and doing accurate business projections is the way to ensure longevity in your industry. Intelligent businesses gather the right business data, process like an expert, and get informed reports into the right hands quickly.
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