Business intelligence gives company owners useful insight into their raw data that can be leveraged into new, more effective strategies. Organizations generate a lot of raw data from their day-to-day operations, and this data serves as valuable material for business intelligence software to analyze.
While manually organizing and analyzing all pieces of organizational raw data is possible, it may be beyond the scope of what is reasonable within an organization’s time constraints. Business intelligence software can make it far more feasible for an organization to take full advantage of its raw data with the smallest possible margin of error.
What Business Intelligence Can Determine
To put it simply, business intelligence helps businesses identify the most effective practices to improve their performance quality and decision-making skills. The extremely sizable archives of data that organizations build up over the course of their operations contains many gems of insight that businesses can use for everything from predictive analytics to complex event processing, according to CIO.
A data warehouse is where a great deal of the information used for BI analysis is drawn from. It is important to make the distinction that not all data warehouses are explicitly meant to serve as BI harvesting sectors, nor are all forms of BI dependent on data contained within a data warehouse.
Predictive Power
Through the implementation of accurate business intelligence metrics, businesses can determine which of their practices are producing the most positive returns with the most consistency. Though a business may have a vague idea of what does and doesn’t work already, with business intelligence, it is possible for the complete picture to become far clearer than otherwise.
If the intelligence is of a high enough quality, then the business may be able to discover brand-new market opportunities entirely. It is already valuable enough to know just what the demand is for individual products and services, but the ability to crack into new potential markets in advance can be invaluable for businesses that want to stay ahead of the competition.
Specific Factors Composing Business Intelligence
Business intelligence is made up of a great many different pieces that collectively create its full value. The different components making up business intelligence include: open item management, process management, key performance indicators, forecast for group consolidation, budgeting, statistical inference, real-time reporting, denormalization, multidimensional aggregation, and several other things as well.
Historical Use of Business Intelligence
The origin of business intelligence can be traced back to the mid-19th century, with the work of Richard Miller Devens and his book: Encyclopedia of Commercial and Business Anecdotes. In the earliest use of the term, business intelligence was used to describe the way bankers were able to maximize their profitability by paying special attention to key signs in the socioeconomic environment before their competitors.
Banker Sir Henry Furnese served as a key example that Devens used to illustrate the meaning of the term. Furnese took note of many different branches of business intelligence in France, Germany, and several other countries simultaneously; because of this, he was always at the forefront of the most profitable trends to capitalize upon.
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Conclusion
Business intelligence has often been compared with business analytics, if not used as a synonym; however, there are a number of distinctions to be aware of, according to TechTarget. While business intelligence is made possible through a combination of analytical solutions and direct questions being asked, business analytics attended mostly on statistical processes. With business intelligence, an organization can find the answers to questions that their less-savvy competitors won’t know to ask yet.
