Business Intelligence

What is Business Intelligence ?

The key to this vital knowledge lies in the mountain of raw data that your organization already collects. Business intelligence uncovers innumerable competitive advantages by transforming that raw data into actionable intelligence and by creating knowledge to implement winning strategies and deliver information that can be leveraged by your entire organization.

One of the greatest inhibitors to competitive advantage is acting solely on “gut feeling” or “intuition” so many decisions have been made based on what someone feels versus what the data say. These decisions cannot be measured. They cannot be repeated. They cannot be easily understood or shared. Many domain experts have specialized knowledge and this knowledge and context needs to be joined with the data to improve future decision making and provide competitive advantage. This union of gained experience and expertise need when converted to quantified measurement tool is termed as 'Business Intelligence'.

Foresight Vs Insight in Business Intelligence

Many organizations have adopted BI applications in hopes of extracting greater insights from all the data generated by their operational and transactional systems. Unfortunately even after acquiring the traditional BI the competitive differentiation remains elusive. One reason is that the competition is probably doing the same thing with the same tools

Furthermore hindsight and querying the typical offering that is often termed as Business Intelligence cannot deliver the predictive insight and deep understanding that is required to outperform the pack. Past trends tend to be poor predictors of the future possibilities. Organizations need a way to way to distill the predictive insights from the multitudes of interrelated factors, far beyond simple trend analysis. Otherwise revenue opportunities reveal themselves as too late for positive action.

If a BI solution can not help you make sound decision about your organization future easily, reliably and at every level of the organization it is neither good nor intelligent solution.

According to SAS the leader in providing a new generation of business intelligence software and services, definition a platform does not offer true business intelligence unless it satisfies the following criteria

1. Breadth (It integrates functions and technologies from across the organization)

2. Depth (It reaches all those who need it, in a way that is relevant to them)

3. Completeness (It is a comprehensive, end to end platform)

4. Advanced analytics (It delivers predictive insights, not just hindsights)

5. Data quality (It gives the applications one validated, verified version of the facts

6. Intelligence Solutions (It meets the information needs of the intelligence applications)

BI tools and Vendors currently in the market

1. Microsoft

2. Business Objects

3. SAS

4. Cognos

5. Hyperion

6. Oracle

*this is a random listing and not as per any order defined, more details separately present as per different criteria

Application of Business Intelligence in Industries

1. Banking, Finance and Insurance Sector

2. Sales and Marketing

3. Manufacturing

4. Education

5. SME ( Small and Medium enterprise )

6. Retail

7. Telecom

8. Healthcare

9. Tourism

10. B2B industry

11. Media and Entertainment

Data intensive industries

Not only that but also the usage of traits from BI have been found in the speculations analysis of the Exit-Polls during recently government elections for Indian Government.

(* BI does not have any say in the allocation of portfolios though :-) )

Use of BI in different Departments

There are several distinctive departments in an industry. The nature of work done in these departments is highly specific. Thus the business intelligence solutions for a particular department are designed with specifications so as to meet the requirements of that particular department.

Some of the specific usages of these softwares in a particular department are discussed below:

1. Sales, CRM and Marketing

2. Finance

3. Human Resource

4. Operations

5. Strategy

BI Market Overview for India

The Business Intelligence software market in India is in high growth phase and currently witnessing a year-on-year growth of more than 20 percent. Revenue from BI software market was worth $23.8 million in 2004, and is expected to reach $99.1 million in 2011, growing at a compound annual growth rate (CAGR) of 22.6 percent during the period 2004-2011. The adoption of BI software in India is region-specific. Western part of India is the largest market for the BI software, whereas the demand from eastern part of India is comparatively very low. Majority of vendors for BI software have partnered with system integrators (SI) and value-added resellers (VAR) to effectively market their BI software products. Business Objects has formed strategic partnership with Teradata, and Hyperion has partnered with IBM. The presence of many BI software vendors has made the market highly fragmented. There is a greater demand for customized BI software solutions from medium-sized enterprises. Majority of these enterprises generally opt for the local BI software vendors that develop customized BI software that suit their budgetary requirements. BFSI and telecommunication verticals are the major adopters of BI software in India, and contribute maximum to its revenues.

A significant number of public sector banks are yet to deploy BI software, which provides a good potential for the BI software vendors to foray into this vertical. The current contribution of verticals including manufacturing and government are relatively low: however, it is expected that these verticals would drive the BI software market during the forecast period 2005-2011. As the awareness about BI software increases, other verticals such as retail and distribution and hospitality are also expected to invest significantly in the BI software solutions in the Indian market.

Business Intelligence Importance After the 2008 Recession

After the hit of 2008 recession to the world economies it has become even more important to include in the strategy and invest in Business intelligence. This has even been agreed upon and acted by various national economic advisors. Usage of deep analytical capabilities of various BI tools has been done to find out root cause and emerge with multiple strategies to revive economies.

Microsoft forecasted the growth of BI early with the onset of recession in Oct-Nov 09 and was also publishes in one of its articles.

There’s little doubt that the current economic situation presents challenges for businesses of all sizes in every industry. Around the globe, companies must cut costs and reduce risks as they confront slower sales, hesitant suppliers, and tighter credit. But with challenges come opportunities. If you maintain a long-term perspective—even as you take short-term steps to adjust to economic realities—you can sharpen your organization’s focus. Even with limited resources, it’s possible to achieve your business objectives if you reduce costs, make smarter strategic decisions, and continue innovating new products and solutions.

With Microsoft Business Intelligence (BI), you can focus your resources—whether they are people, technology, or capital assets—to achieve these goals and generate the maximum return for your organization. You get the right information to the right people faster. As a result, they make smarter, more informed decisions, increasing efficiencies in the short term and positioning the company for growth in the long term.

This is just one of the instances where companies have done a public approach of explaining the details of BI.

Not only has BI found an entry into company policies starting from Sales and Marketing, Finance to Human Resources (Of course some of it also is being utilized in right sizing the company based on BI done over the employee productivity count, ROI, Cost to company and Performance. A lot of pink slips distributed owing to the decision given by the BI).

Taking things on the lighter sense BI now has even gained entry into the common man's home even without availability of any tool in decisive areas like

1. Spending done on entertainment per week

2. Savings per week

3. Energy and Fuel consumption

4. Grocery purchase to spending done on the phone bills

5. Forecasting and planning of travel expenses

6. Insurance and safety deposit planning

7. Proactive analysis and intervention in terms of health

After this a really money conscious person can not say that he will not be affected by utility of Business Intelligence. In one way or the other he definitely is going to be affected by it. The only difference that will remain is the level of penetration into his day to day system and the utility of the concept in terms of tools and domain that it is being utilized.

Finally to say

STRATEGY to make a responsible decision is being REDEFINED

More details in terms of market analysis, competitor analysis, future trends, drivers and key challenges coming up in the next blog.