Driving Change with Business Intelligence (BI)

What is Business Intelligence and What Does it Do?

by Crystal Lee, PMP, and Chris Patrick, PMP

Recently we’ve been hearing a lot about business intelligence (BI). In today’s challenging economy, many companies are turning to business intelligence to find ways to save money and identify new opportunities to make money. Do you know what BI is and what it can do for you?

More often than not BI discussions focus on the end result – visualize the image of the CEO poring over a report and making important decisions. However, business intelligence is much more than just a bunch of reports. BI refers to a wide range of applications and technologies aimed at collectingstoring,analyzing, and providing access to data to help people make better business decisions. In the end, to get the right report to the right person, every step of the BI cycle must function optimally.

There are business intelligence tools on the market that claim to provide exceptional reporting capability. The truth is that these data integration and business intelligence reporting tools are only part of the equation and provide little benefit without a scalable, accessible, and resilient data warehouse. The goal of this article is to discuss the critical components of a BI system and provide tips on choosing and implementing a winning BI system.

The BI Information Cycle

In a business intelligence system, information must pass through several transfer points. Data must be collected, sent to the data warehouse location (sometimes via intermediaries), transformed if required, and then stored in its original or transformed state in the data warehouse. The BI consumer then requests the information which is delivered in the requested format. During the reporting process, data may be transformed once more via various analytical techniques such as data mining, visualization, online analytical processing (OLAP), scorecards, drill-down, and modeling.

The following chart outlines what occurs in the BI cycle for three sample businesses: a bank, a restaurant, and a clothing store.


Collect Data Transfer Data Transform and Store Data Report Data to Management and Staff
Customer banking transactions, loan and credit services used ATM and banking network Data warehouse with financial analysis software and custom queries Where do we open the new branch? What credit card enhancements can we offer to our customers? How can we make this data useful to our customers?
Dining purchases from food ordering system, in-store surveys, credit card data Point-of-sale system (single store or at central HQ) Spreadsheet or data warehouse, special analysis software for restaurants Which menu items should we discontinue? Which items should waiters push more? Should we stay open later on weekends?
Clothing purchases from cash register receipts, in-store surveys, credit card data Point-of-sale system (single store or at central HQ) Spreadsheet or data warehouse, special analysis software for clothing stores Should we spend more marketing dollars on babies or teens? Are there enough customers coming from the next city to open a new store there?