Experts are still arguing what business intelligence is: is it identical to business analysis or is it a separate area of knowledge. To understand this, let’s look at the main goals of business analysis and business intelligence.
Business analysis is the study of a company’s activities in a broad sense: analysis of an enterprise’s development strategy, its business processes, organizational structure and park of information systems, designing and configuring the interaction of all this with the business environment and the external environment.
The main goal of business analysis is to develop and implement organizational changes that would allow the company to achieve its main goals in the best possible way.
The main goal of business intelligence is to support management decisions and organizational changes with high-quality, relevant and objective data.
Here are the three main tasks of business intelligence:
- get data about the work of the company in the form of numbers;
- process and structure this data – make it suitable for further analysis;
- to analyze the data – to find patterns in the activities of the enterprise and simulate forecasts of its development in certain conditions.
Thus, business intelligence is a part of business analysis that is responsible for collecting, processing and analyzing data. It is the first and necessary step in effective organizational change management.
Which companies need business intelligence and why?
Business intelligence is essential for all companies that want to make quality management decisions. Only decisions that are based on facts can be qualitative. Business intelligence is responsible for collecting and processing these facts.
It is important not only to collect data on the activities of the enterprise, but also to prepare them for managers:
- structure;
- analyze – identify trends and trends that affect factors;
- present the results of the analysis in a visual form;
- prepare recommendations on how to use this data to improve the company’s operations.
Through the recommendations of business analysts, the company’s management receives up-to-date and reliable information about what is happening in the company and beyond. This approach helps to make informed and high-quality business decisions.
A simple example: a company sells seasonal goods such as bicycles or skis. Business analysts will accurately determine the product demand curve taking into account seasonal factors, demonstrate it in an understandable way to managers and give detailed recommendations on what needs to be done to maximize sales revenue. Without business intelligence, such decisions are made blindly – this leads to the fact that the company misses out on value.
What are the trends in business analytics?
Typically, directions in business intelligence are determined through data analysis methods: cluster analysis, correlation analysis, regression analysis, linear programming methods. In the Business Set, we defined the business intelligence subtypes a little differently.
We distinguish four areas of business intelligence. Each of them corresponds to one of the key elements of the control system. These elements are:
- Enterprise development strategy.
- Business processes.
- IT architecture.
- Organizational-role structure.
The business intelligence you need to develop your strategy. The development strategy is the most important element of the enterprise management system. In order for the strategy to turn out to be of high quality, it is necessary to analyze a large amount of data and figures. For this, a business analyst is involved.
He analyzes external marketing information – for example, how customer demand is changing, how competitive forces are affecting the business. Based on the results of the analysis, the business analyst prepares a report that forms the basis of the enterprise development strategy.
Analytics of the company’s business processes. Business processes are a tool for implementing an enterprise strategy. Achieving the strategic goals of the company is possible only through the precise execution of customized business processes.
In order for the processes to meet modern approaches, take into account changes in the business environment, and successfully realize the internal potential of the company, they need to be updated periodically. Such changes are also prepared by working with data.
To do this, analyze the values of indicators of business processes:
- determine the factors of influence on the processes and the nature of these factors – they are random or not;
- evaluate the manageability of processes: are they capable of consistently producing a quality result;
- evaluate their throughput: how many requests per unit of time they are able to process.
Based on the results of the analysis, proposals for changes are developed. It is necessary that the proposed changes help eliminate failures in processes and improve the quality characteristics of products. This will allow you to more accurately achieve the strategic goals of the enterprise.