To talk about the valuable applications of using business intelligence in organizations, one must pay attention to the theories of analysts in this field. Consider these three quotes, for example:
Chase Hammond, the business intelligence analyst at Skyword Inc. content marketing company, summarizes the value of the business intelligence process, or BI, as follows: “Learn more about what happens in business and understanding what happens at the micro-level ”.
“The kind of understanding of business intelligence initiatives is very important for corporate and business executives,” says Doug Henschen, an analyst at Capabilities.
“It is almost impossible for an organization today to be run competitively without the basics of reporting and analytical ability,” Hansen said. The use of business intelligence in organizations is a necessity. “It’s important to know where the units, departments, and the whole business are compared to competitors, market trends, and the company’s past performance.”
Why is business intelligence important?
Uses of business intelligence include a variety of programs that assist in operational and strategic decision-making. Hansen and other analysts said that organizations in all industries see BI as an important component of becoming a data-driven company. This increases the vast investment in business intelligence tools, BI professionals, and other resources needed to implement a successful business intelligence strategy.
For example, Gartner Market Research and Consulting said in its Magic Quadrant 2020 report on BI operating systems and analytics that the number of people using them is “increasing exponentially.” Reflecting the growing use of business intelligence, a report released in November 2019 by Business Research Corporation estimated the total value of the global BI software market at $ 3.14 billion in 2018 and predicted that this figure would be compounded by an annual growth rate of 19. 1. To reach $ 77.28 billion in 2022.
Dresner Consulting Services, in its Business Intelligence Market Survey published in May 2020, said that according to a survey of BI users, reports, dashboards, data integration, data warehousing, and data preparation as the top technologies and initiatives for establishing business intelligence. They have mentioned. Dresner added that self-service BI, advanced data visualization, data discovery, data storytelling, and the use of cloud space have been the next priorities of users.
Although the return on investment in BI tools, programs, and teams varies depending on how the firm is positioned, the following five uses indicate the type of business benefits and value of BI for an organization.
Business benefits The main uses of business intelligence
Organizations can achieve these benefits by using business intelligence.
1- Pursuing key performance indicators to identify business issues
Organizations regularly track down key performance indicators for decades. In fact, some of them have a lot of KPIs in a department. Tracking and, most importantly, understanding this volume of business metrics is impossible without the help of technology. This stage is exactly where BI shines.
Experts say identifying KPIs for tracking and layering will provide insight into other parts of the data that add more dimension to those KPIs. In addition, business intelligence and data analysts can use BI tools to add weight to specific data points that are more influential than others; A process that helps organizations understand how these elements affect KPIs.
Megan Silva, leader of the data optimization at private equity firm Cresset Capital Management, said: So they can be ranked in some way. That fact must be taken into account. ” For example, a hotel in a tourist area with seasonal business acumen generally tracks its revenue and occupancy. Silva added: “With BI, this hotel can include other data; “Like weather records to add context to KPIs and help make data meaningful.”
“BI analysts typically work with business executives and other stakeholders to define metrics and then build a reporting infrastructure in a data visualization tool,” Hammond noted. “A BI analyst is also likely to analyze the numbers behind the KPIs to better understand what is happening.”
2- Accelerate and improve decision making for business intelligence in organizations
Business intelligence brings together data mining, data analytics, and data visualization to give managers and other business users a complete view of organizational data, then they can use them to make more informed business decisions. To take. “Using BI tools to support decision-making is one of the main uses of business intelligence,” said Christopher Asakiewicz, an associate professor of industry at the Stevens School of Technology and director of BI and its analytics program.
It is important to be able to use data to make decisions. In a 2019 survey conducted by Feedback Loop (a consumer feedback platform vendor), 91% of the company’s 310 respondents said that data-driven decision-making is very important to them. Only 4.57% of them stated that they do this often or almost always. On the other hand, 33.9% consider the lack of reliable data to be the biggest challenge in doing so. Similarly, 8.46% cited the lack of quality data as one of the most important barriers to good decision-making.
Modern BI methods are achieving the goal of enabling faster decisions through the receipt, processing, analysis, and visualization of data, on a larger scale and at higher speeds, which are influenced by the powerful management of data and data quality processes.
“Not only have we been assessing what happened faster, but we can predict the possible outcomes sooner and more accurately,” said Robert Duttill, a chief business officer at UST Global Technology Services. That fact must be taken into account. ” He noted that predictive analytics related to BI programs can provide near-real-time updates for business users for quick action. It can also be used to automate decision-making and implementation aspects.
Companies can also use BI capabilities and real-time analytics, such as understanding customer acquisition trends, comparing the success of different customer engagement programs, and measuring their lifetime value. This enables marketing managers and business leaders to make immediate decisions at the right time and for how to make their decisions.
3- Optimizing business processes to increase productivity and efficiency
In a typical organization, the amount of operational data can be so vast that the workflow is not obvious to employees involved in specific business processes or the managers who oversee them. But BI technologies, including embedded analytics tools, can collect data from enterprise resource planning (ERP) systems and other business applications to discover the dynamics of operations that need attention.
For example, BI tools can detect inefficiencies in production processes, supply chain bottlenecks, and unbalanced information technology networks in which some systems are overloaded and others are not used at all.
“You have all this transactional data that can be used to discover things that are failing in your organization,” said Dennis Smith, a business consultant at Swingtide IT Consulting.
“A large distribution and realization operation with nearly 40 warehouses had an automated regeneration system that would order replacement stock whenever inventory fell below a certain level,” Smith said. However, in a BI report, the company found orders for which it received invoices, but not real stock. “It shows that the material is lost somewhere in the process.”
“This is a good example of how business intelligence can help you do your homework,” says Smith. You can clear the data. Link data together and organize it. The BI Analyzer can put the data together and diagnose a business problem. They cannot see the problem until they have combined all the data to produce that report. ”
In fact, according to a Dresner market study, using business intelligence to increase operational productivity is BI’s main goal for organizations in 2020. This study showed that greater productivity and cost savings have generated revenue as BI priorities in response to the economic downturn caused by the COVID-19 epidemic.
4- Analyzing customer data to improve marketing and sales programs
By analyzing data from several internal and external sources, BI provides marketing and sales teams with in-depth information about the needs, wants, and purchasing patterns of current and potential customers. The purpose of using this BI is to further the success of the customer’s advertising efforts and ultimately increase sales.
“It gives them insight into what [marketers] recommend, and it shows them what people like,” said Tom Austin, CEO and founder of The Analyst Syndicate, a network of independent tech and business analysts. “Which way can their organization lean?”
The insights generated by BI take the speculation out of the equation and enable organizations to build more effective marketing campaigns and create the right sales pitches and promotional offers. Target the right audience with the right message and create new products and services that best fit the customer’s tastes; Customers looking to serve them. Austin and others point out that all of these can reduce marketing and sales costs and increase revenue.
Consider a financial institution with a new client who has just started working with them. “The sales and marketing team can use business intelligence to analyze data about that customer – age, revenue, etc. – and the portfolio of similar customers, to identify marketing opportunities for the additional product,” says Silva. “In this case, the firm can figure out who to contact and who to offer to find the next customer,” he adds.
5- Assisting managers of companies and businesses in strategic planning
In a quarterly survey of senior executives involved in the company’s risk management plans, Gartner found that “strategic assumptions” were the number one concern in the first quarter of 2020 and the fourth quarter of 2019.
BI is a key element in the analysis of strategic risks. But it is essential that corporate and business executives be able to access BI information of any kind to gain accurate insights into organizational strategies and directions.
Hammond labeled strategic planning as an important use of business intelligence, noting that “providing information to the executive team for planning purposes often involves analyzing more comprehensive data.” “Not just launching some simple dashboards.” “A BI analyst may have to analyze large amounts of customer historical data alongside third-party data to help managers understand the current state of the business and various future scenarios.”
Other analysts agree, saying the ability to extract strategic insights from data is essential to staying competitive in today’s digital world, where rapidly changing market dynamics may necessitate adjusting company focus and business strategies as quickly as possible. Is.
“BI and analytics are effectively the eyes and ears of the organization, helping managers and operations staff to orient and make decisions using data,” Hansen explained. “With this data, executives can interpret trends and patterns over time,” he added.
The result of business intelligence in organizations speech
Business intelligence, or BI, plays a key role in the strategic planning of organizations and is used for a variety of purposes, including measuring performance progress toward business goals, performing quantitative analysis, reporting and sharing data, and identifying customer insights. Business intelligence includes the strategies and technologies used by companies to analyze a business’s data. BI technologies provide historical, current, and predictive perspectives on business operations. Strategic business decisions also include priorities, goals, and directions at the broadest level.