The term ‘business intelligence’ refers to the systems and processes that help to simplify and use information in an organization to enable faster and easier decision making by providing key information to the decision makers in a timely and efficient manner. Often, business intelligence is confused with the tools that simplify the process. It is necessary to understand that business intelligence goes beyond these tools, which are only the technology that streamline the process of business intelligence. In recent times, the concept of business intelligence has gained huge significance in every organization. To understand this significance, we first need to understand the benefits of business intelligence.
1.Helps align the organization towards its key objectives:
Business intelligence helps an organization to align towards its key objectives. To this end, an organization must first design its key performance indicators (KPI) to suit its style and strategies. The KPIs need to be designed for each of the levels in the organization starting from the highest, moving towards the lowest. In order to be successful, these KPIs must be in tune with the competitive advantage of the organization, act as lead indicators that predict outcomes in the future, focus on performance rather than outcomes, and permit the combination of metrics. Again there should be process-related and outcome-related KPIs and it is essential to maintain a healthy balance between these to ensure the success of its design. Because, ultimately organizations are built based on the outcomes they deliver and not on their processes, the processes only enable the outcomes. Thus, business intelligence effectively uses the KPIs and metrics to enable the organization to achieve its key objectives.
2.Enables faster and fact-based decision making:
Often business decisions are delayed or changed due to lack of information or frequent changes in the data received or in the way it is perceived. The data in an organization should be organized in such a manner as to allow a user who queries the data to explore further details as per their requirement instead of looking at data as provided by the developer of the reports. The way we perceive data influences and changes our decisions; therefore it is essential that data be available in an accurate as well as easily accessible manner. Business intelligence enables easy access to data in its actual format enabling faster and fact-based decision making.
3.Combines multiple sources of data for decision making:
Often decisions made in an organization impacts more than one aspect. Business or marketing decisions are based on the clientele that an organization wants to concentrate on, financial decisions are based on sales and marketing prospects, hr decisions are based on employee requirements, attrition rate, and gaining new business deals. Therefore business decisions also require data and metrics from various aspects of an organization. Business intelligence provides data not only from various aspects but also in ratios and formats that enable to compare these metrics to enable effective and efficient decision-making.
4.Efficient collection and distribution of vital data and statistics:
Business intelligence refers to a system that enables the collection of different data and metrics for the purpose of efficient decision making. Therefore it establishes a system wherein data can be collected and distributed in an effective manner. It provides accurate data and at real-time ensuring all decisions are not only made quickly but also based on factual data.
Thus, business intelligence can be considered a process or system that can be effectively implemented in any organization irrespective of its size or niche. It helps organizations to enhance their competitive edge and thereby establish themselves in a highly competitive market, where small differences mark the big difference between failure and success.
Source of the information: benefitof.net