Wake up and smell the servers. It’s almost 2017.
The entire world is fueled by data. Decision makers no longer make choices based on gut reactions, instead they rely on business intelligence (or BI if you want to speak like the cool kids). Although BI isn’t really anything new, it’s definitely time to understand it if you don’t already, mostly because your competitors are probably already masters of it.
In its simplest form, BI is the process of taking raw data and transforming, or interpreting, it into useful information that companies use for business analysis determinations. The reasons for using BI typically are to uncover flaws or inconsistencies, identify market trends and purchase patterns, and/or develop new decisions and business opportunities. Think of it as the “here and now” of your company’s data. It takes all of the structured or unstructured data you currently have, analyzes it and regurgitates it back in a way that is easy to understand through querying and reporting. It is the evidence you and your executive team needs to make vital decisions for the betterment of the company. To gain a profounder understanding of BI, let’s dive a little deeper into its benefits, process and enterprise applications.
Benefit from Info You Already Have
At the end of the day, when your executives make decisions, they want to make sure they are right. No one wants to look dumb, but more importantly, no one wants to lose money. In order to stay ahead of the game, being proactive rather than reactive is key. With everything in today’s world being quantified and recorded, people are able to have concrete proof to support their decisions with the help of BI. Aside from it posing as evidence, here are some of the other main benefits:
- Enables companies to react quickly to consumer demand
- Allows people to efficiently implement cost-cutting ideas
- Optimizes pricing strategies
- Uncovers flaws and inconsistencies in processes
- Provides more leveraging to quantify decisions
Understand the Process
Alright, now that you have a basic understanding of what BI is, let’s discuss the process of how it’s used.
In all companies, data is presented and formatted in a plethora of diverse ways. For example, the way a hospital consumes their data will be much different than way a credit card company does. However, the process is characteristically the same. The first three primary steps in compiling all of this data are Extract, Transform and Load (ETL).
- Extract – The most critical step in this process is extracting your data from your databases source systems. It’s imperative that this is done accurately and successfully. This is crucial because the extracting phase will influence the rest of the process.
- Transform – Once the data has been extracted from the source systems, it’s time to apply rules to the data. This essentially keeps the data clean and consistent, and converts it into the desired state.
- Load – Now that the data has been pulled and tidied up, it’s time to load it all into one centralized location, or a data warehouse. Storing this data in one place creates easier accessibility for those who need to delve into it.
Aside from ETL, another aspect of this process that helps businesses understand their raw data is data mining. Data mining is the process of discovering patterns in large, vast amounts of data sets. The overall goal of mining, once it has gone through the ETL process, is to accurately interpret data in a way that decision makers will understand. Data mining basically functions as the Rosetta stone for interpreting your info.
Mixed Applications Amongst Varied Industries
For several years, BI’s been a term that has been knocked around from industry to industry. With the advancement and widespread use of technology, capturing data has only grown larger and larger, and will continue to grow as long as we continue to consume. It’s no wonder almost every industry relies on business intelligence to cultivate and encourage accurate decision making. For instance, in the realm of retail, companies are using BI to detect fraudulent transactions in order to retain profits and eliminate losses as well as identify where such fraud is most commonly taking place. Restaurants such as Wendy’s and T.G.I. Friday’s, use BI to figure out the best sustainability methods for their food. In baseball, a prominent front office figure, Theo Epstein of the Chicago Cubs, uses BI to analyze player statistics in an unorthodox way through a method known as Sabermetrics, which is designed to maximize an organization’s salary cap while still fielding the best possible team. As a matter of fact, just a couple of weeks ago, he successfully ended the “Curse of the Billy Goat” by winning the World Series relying on business intelligence that he and his staff had accumulated.
Whether you’re an end user or an IT professional, business intelligence is used all across the world in numerous industries. Appreciating the process of inferring such data will not only aid in the feats of a company, it will aid in the success of its leaders and executives. With how much raw data is compiled in this day and age, it’s astonishing how creative and imaginative people become after analyzing all of it. The value placed on data is only increasing and becoming more and more prevalent. You don’t want to be the one held responsible for what your gut told you. Stick with the data, it doesn’t lie.
New Horizons offers an abundance of classes pertaining to business intelligence whether you’re a novice or an experienced user. Here is a list of some of our most popular courses we provide based on audience: