Running your own business can be both beneficial and challenging. To stay on top of the competition, companies must strive to come up with different ways to improve their operations. And that is where business intelligence comes in.
What Is Business Intelligence?
Business intelligence (BI) entails using software and algorithms that allow companies to carry our data analysis to arrive at strategic business decisions. BI tools can take the form of graphs, charts, tables, reports, maps, and other forms of data visualization to help users better understand the information presented and draw conclusions and make actionable insights.
For some, BI serves as descriptive analytics since it only shows the past and present state of a company. While it cannot provide information about a business’s future state, it can, however, guide executives better manage the company to ensure its success and growth.
What Are the Use Cases of Business Intelligence?
BI uses past, present, and predictive outcomes of decisions made. As such, it can impact all business functions ranging from finance to production to sales. Here are some uses cases of BI for organizations:
Perform Consumer Analyses
Technological advancements over the years have allowed companies to connect with consumers and clients more efficiently. Some of these include social media, emails, interactive conference calls, websites, chatbots, and other communication means. These touchpoints give businesses a method to gather data from several avenues.
BI can then collate and analyze the data collected from various sources to provide a comprehensive overview of a company’s consumers and clients. Compared with the average data analysis that only provides insights into a business’s current status, BI can also evaluate possible reasons why a specific strategy worked or failed.
As such, with BI, companies can establish cause-and-effect relationships to delve deeper into consumer and client behaviors and make sound predictions that can guide them in the future. They can adjust their marketing, advertising, and sales strategies to suit their clientele’s requirements better.
Enhance Operational Efficiency
A closer look at today’s market reveals that it is rapidly moving toward saturation, if it has not yet, that is. The Internet has tons of content, products, and services for just about anything any person may wish to see. It has made it easy for people to gain access to everything they need or even want.
With BI, company owners and executives can receive guidance on what resources and infrastructure they should fund more. They can then include their findings in proposals for new business models, processes, and methods that can enhance their operational efficiency.
BI can also provide critical insights into a company’s end users. It can uncover what influences their purchases and then locate and use these in their marketing, advertising, and sales campaigns.
The current market landscape is full of companies fishing for information to rise above the competition. BI can provide business owners with accurate information about their target audiences. They can then use this data to make sounder decisions that would help them improve returns on investment (ROIs) and drive revenue.
Maximize Competitive Advantage
Most businesses fail because they cannot keep up with the competition. Nokia, for instance, used to be at the forefront of mobile technology. But that changed through the years as many startups introduced new business models that eventually led to Nokia’s downfall.
While it is true that companies can quickly gain insights using tools such as Google Analytics and account statements and reports for their decisions, these provide limited information about the market in general, consumers and clients, and the competition.
Companies that genuinely want to edge out the competition need information that is not readily available to anyone. That is something that BI can provide. BI analysts scour secondary resources, market trends, and social signals, allowing businesses to outpace their contemporaries.
Identify Business Challenges
More than analyzing profit-and-loss statements, BI can also be integrated into applications such as accounting software to identify market trends that often stay hidden from stakeholders. Aside from tracking key performance indicators (KPIs), BI tools can also forecast potential pain points that are time-sensitive and so require immediate decisions and actions. In short, BI can help unmask problems that traditional analysis methods often miss.
When Should Business Intelligence Be Used?
All companies can benefit from incorporating BI into their operations. BI is particularly useful in cases such as:
- When you want more visibility into how well your company is doing in terms of news, events, finances, and operations
- When there is a pressing need for you to integrate data from several business applications into existing processes and systems
- If your company has a high employee volume who need to access information to perform their tasks
- When you need quick and efficient access to crucial business data for, say, preparations for a possible merger or acquisition
- When you need to make necessary upgrades to your information technology (IT) environment
What Are the Current Trends Driving Business Intelligence?
If you are thinking of using BI, here are some trends that you should consider:
- Collaborative BI: BI tools can be integrated into collaboration and communication tools to improve information sharing among users. They can, for instance, be used to gather data from social media platforms that can serve as inputs for collaborative decision making.
- Artificial intelligence (AI): AI- and machine learning (ML)-powered BI tools can help collect real-time data to improve analysis and reporting.
- Embedded BI: Most companies embed BI software into business applications to improve and expand their reporting and analysis capabilities.
- Cloud analytics: Cloud analytics is gaining traction, and BI is likely to benefit from this shift. Companies with smaller budgets can benefit from more cost-efficient cloud-based BI applications.
BI refers to a set of processes and technologies that efficiently transform raw data into useful and insightful information that helps business owners improve their profitability. BI technology can help data analysts, executives, IT professionals, and company owners identify current market trends and identify challenges that need immediate solutions.