The Business Intelligence software sector is expected to expand from $23.1 billion globally in 2020 to $33.3 billion by the year 2025. It will grow with a CAGR of 7.6%. (MarketsandMarkets)
“He who knows the enemy and himself will never in a hundred battles be at risk.” This thought shared by the famous Chinese Military General, Lao Tzu still rings true after 2500 years, especially in the corporate battlefield. Business Intelligence (BI) is nothing short of military spy games. You’re trying to defeat the competition at their own game!
BI in general can be defined as user-friendly insights in the form of text reports, graphical dashboards, graphs, charts, and comparison tables that inform business decision makers about the current state of an opponent or self’s business operations. The data can be recorded and saved, so that it can be used for comparison with future reports.
Users can apply the insights gained from BI to identify business issues eating through profits, find new revenue streams, identify market trends, and improve business decisions. It enables users to leverage different datatypes — third-party data, inhouse data, historical data, realtime data, structured data, unstructured data, semi-structured data, and more.
When It All Started
‘Business Intelligence’, as a term, was first used by author Richard Millar Devens in 1865 to cite a smart banker who collected information on the market before his potential competitors could. According to the author, it gave the banker an unspeakable advantage of speedy business scaling.
Later, IBM scientist Hans Peter Luhn in 1958 decided to use technology to gather business intelligence. The research into BI helped Lugn create IBM’s early data analytics strategies and platforms. By the 1970’s, the very first decision support system (DSS) was developed to store huge stacks of data and to organise them effectively.
BI grew popular in the 90s, but since the data accumulation and reporting system were complex, it required high levels of maintenance from IT. And hence there were backlogs affecting business strategy creation. Early BI software required extensive technical training to use, which a lot of techies couldn’t wrap their head around.
It wasn’t until the end of the 21st century’s 10th decade that self-service BI applications were created. It allowed non-technical people and common business owners to get the benefit of self-generated analytical reports. Modern BI platforms are cloud-based and can gather intelligence across multiple geographies. They also handle big data in a relatively short time than earlier BI interactions.
How Do Business Intelligence Software Work?
Business Intelligence tools rely primarily on data warehouses, which aggregate big data stored within them into baseline data. The data is multiplexed from multiple sources into a core data system that’s easy for business analytics processes to approach.
Data warehouses are integrated with an online analytical processing (OLAP) engine, which supports multi-dimensional queries. For example: What is the clickthrough rate of a company’s ad in their targeted geography’s southern region against the same in the northern region, compared to two years before.
Data scientist Dough Daley from IBM suggests that OLAP is a powerful technology that can be used for data discovery, predictive analysis, and it can solve compounded analytical calculations. He explains, “The primary benefits OLAP offers is consistency of information that’s used to drive quality improvement, process improvements, and customer interactions.” These days, avant-garde BI solutions can use tools like Hadoop to extract actionable proto-intel from a mountain of raw data. Yet, most businesses still prefer the tradition of using data warehouses.
Advantages of Business Intelligence Software
Some of the well-known advantages of using business intelligence software include:
Accurate and Speedy reports: Variety of data sources can be used to create customised reports that help monitor various KPIs. Relevant data warehouses are used and the results are generated in real-time. These reports are usually made up of easy-to-read visualisations including charts, graphs, and tables. Modern BI software offer the opportunity to interact with the data while the report is being generated.
Analysis of Competition: Organization and the extraction of useful information from heaps of competition’s data can slingshot the processes of business forecasting, planning, and process budgeting. It’s a powerful strategy to stay one step ahead of the competition. Such data extractions are easy to perform with a business intelligence software, where competitor’s sales and marketing performance can also be surveilled concurrently.
Improved data quality: Data is mostly cluttered like puzzle pieces spread on the ground. Using a BI platform to structure it and clean it into an intelligible unit is like putting the puzzle pieces together to see the bigger picture.
Market trend identification: External market data can be fed into BI system to extract latest market trends and insights. Future predictions can be made based on the trends effectively if the data visualisation of such a pattern shows a recurring pattern.
Boost efficiency of business operations: When a business is not focused on tracking down data for business strategies, they can get more done. A BI software can handle all data extraction and intelligence extraction requirements while the business can focus on more important operations.
Data-backed accurate decisions: Business decisions taken with the help of BI-churned data can be backed by data itself. If data suggests a particular venture is risky, based on numbers and upcoming trends, it’s likely to happen unless there’s an external factor not accounted for. Such intelligence can be delivered to stakeholders speedily, thanks to BI software, that further optimises time-to-decision.
Increased revenue: When it comes to revenue, the right questions can be triggered, thanks to business intelligence tools. The answer to the questions reveal sales weaknesses and prompt improvements in business operations. Business intelligence tools can also scan for inefficiencies and expand profit margins.
Perhaps BI’s biggest advantage of all is increased customer satisfaction. A BI software sheds light on customer behaviour and other associated patterns. Modern companies like to take customer feedback in real-time as it betters customer retention rate. More customers means more profit. Majority of data that contemporary businesses operate on is that of customers and leads. A lot can be done with business intelligence, you just need to know how it should be used. Contact us today to learn more about Business Intelligence and the solutions we offer for it!