Business intelligence or BI is a term that is increasingly used in business. It can benefit both large and small businesses, although typically, larger businesses have had more scope to invest in implementing effective BI solutions. However, that seems to be changing, with research revealing that small businesses, with up to 100 employees, had the highest rate of BI penetration during 2018.
But what does the term “business intelligence” mean and how can it benefit businesses and even drive them one step ahead of their competitors? Read this article to find out.
What is business intelligence?
Business intelligence is the technology-driven process of storing, gathering and analysing vast amounts of raw data. This can be from both internal and external sources. Data is then transformed into insights and presented in a digestible format that is useful to managers, such as in a report or via online dashboards with data visualisations. This enables much more informed business decisions to be made, using the data.
How can business intelligence benefit businesses?
Businesses collect and store huge amounts of data, such as from email signup forms, via social media marketing, from sales, purchased data and much more. There are several problems though. Data may be kept in simple spreadsheets as silos, so only certain people can benefit from it. Managers may struggle with data overload and be unsure what to do with it, resulting in data being left unused. This unprocessed data can be meaningless in its current state, whilst also being costly to store. Over time, this data will also become out-of-date and of little value to the business.
Some businesses may attempt to use spreadsheets to manually sort through data, but this doesn’t allow you to manipulate and drill down the data in the same way as business intelligence tools. By using business intelligence tools and converting the data into a meaningful format, it can provide huge benefits for the business. Here are five important benefits to consider:
Make more informed decisions
Rather than guessing, assuming or going with your gut feeling, effective business intelligence can enable managers to make more informed, data-driven decisions. These decisions can be made with far more confidence too and can help reduce the level of risk. Decisions can also be made far quicker than before, which saves valuable time and money.
Understand customer needs
Businesses can collect data on their customers, such as who they are, what they like, what they don’t like, what influences their purchasing decisions etc. This data can enable businesses to see trends and understand customer needs more. These insights can help you provide the right services, to the right people, at the right time and in the right place. This can enable you to stay one step ahead of the competition too.
Cut costs and remove inefficient spending
Detailed reports can help you see exactly where you’re spending money and can compare this to your budgeted costs. This can enable you to decide where adjustments need to be made to help cut wasteful spending and reduce inefficient costs in the future.
Spot inefficient business processes
Business intelligence will help you to see meaningful data on business performance, productivity, projects and much more. This is a good opportunity to see the bigger picture and spot areas where things may not be performing as well as expected or hoped. You can then use these insights to make changes and improve business processes for the better.
Identify new business opportunities
Most managers may feel they know how the business is performing, but with business intelligence, you may see trends that you didn’t even realise existed. This can help you see new unidentified opportunities for the future which can help to give your business an increased competitive advantage.
Want to develop your understanding of business intelligence further?
The amount of data that is created is astonishing and the rate of data creation is only going to accelerate further in the future.
An increasing number of businesses, large and small, are investing in business intelligence. Not only do they need the systems in place to support their data and business intelligence, but they also need people to help convert the data into something meaningful. This requires skills such as analytics, data mining and reporting.
If you’re interested in developing your business intelligence understanding and expanding your current skill set, browse Open Colleges Database and Cybersecurity Learning Library now. You will find interesting assets specifically about Database Business Intelligence, such as “A Practical Guide to Data Mining for Business and Industry” eBook, a “Big Data Essentials” video course and “Big Data: A Revolution That Will Transform How We Live, Work, and Think” audiobook. You will also find a total of over 1,955 assets on the wider subject of database and cybersecurity, with a range of topics, such as Database Backup and Recovery, Database Performance Tuning and much more.