Business Intelligence
In the modern business world, and more every day, knowledge is the single factor that can make or break a company. Information technology like the Internet has revolutionized the way economics, advertising, sales work, and information itself can often be worth a fortune. Make sure you're on top of information needs with your business activity monitoring and business intelligence programs.
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What is Business Intelligence?
Business Intelligence, or BI, refers to the process by which business and companies gather data, analyze it, and re-apply it in order to make the best possible business and financial model possible for their particular instance. Many businesses devote entire divisions just to this process, in order to try to streamline their workflow and make more money for less effort. Those that succeed, succeed financially also. Those that fail don’t usually last long.
Business performance management solutions like business intelligence might, for example, set up a monitoring system on sales – profits, amounts lost in small transaction fees, amounts paid originally – with enough data, it is possible for a good business intelligence system to pinpoint exactly where costs need to be cut or new systems put in place. A good business intelligence system essentially manages the “value flow “ of a business in an effort to find out where that flow hits its rapids or its deep, fast flowing strong points. Ideally, that data flow will be evened out into a single organic, powerful system capable of producing great results with a minimum of effort. This might include anything from adding jobs in an area, converting a process to automation, or even just changing an advertising strategy; regardless, these processes come about because of the results determined by business activity monitoring processes like business intelligence and related fields.
Why is Business Intelligence Important?
The key reason for utilizing processes like those employed in business activity monitoring and business intelligence is to be able to make, as the head of your company or even in a high management position, informed and intelligent decisions regarding the way your company or business is run; informed decisions like these lead to better, more efficient processes in the actual work environment, and will certainly lend your corporation that competitive edge it needs to succeed in today’s dog eat dog work environment.
Simply put, managers need information in order to run an effective and profitable company, and information can only come through one way – business activity monitoring. Business performance management, when it is successful, may be exactly the trimming and streamlining touch you need to make your corporation or small business a driving force in today’s information driven economy. Good information lets managers know what types of changes will shift things in your company toward a more profitable end product, and helps them better know how their competition compares – and, through that information, how to make sure their companies are better than the competition. If you have good business performance management, you can get a leg up on the competition and deal out the best product for the lowest price – and still get more actual profit than your opponent across the street.
How a Business Intelligence System Works
Business intelligence is essentially a science of economics, and works according to the scientific method. This means it is founded on data rather than simple guesswork. These data are gathered using fair, accurate, unbiased means, and organized in a logical manner in order to produce the best results. It’s not simply some employee walking around and saying what he thinks – it’s careful observation and data collection, which is in turn placed into a large, organized database for careful and considerate review by experts in business management.
A well-designed business intelligence system should be able to pull in data with a minimum of effort and cost – remember, the whole point is to make the company more efficient and profitable – and convert that data into a useable form for the company’s managers and employees. Business intelligence and business activity monitoring may focus on more than just your company, too. You can use business activity monitoring to track, for instance, other competing companies and see how they’re doing in comparison with you.
You might also want to use business intelligence for companies you depend on or work with, even if they don’t directly compete with you. For instance, if you run a landscaping company, you would want to monitor stonemasonry services, quarries, sod companies, and all the various services and companies you would depend upon to make sure your company ran smoothly.
Cooperative Business Intelligence: Making Money, Together!
Besides not only being self focused, business intelligence is also not always self directed either. You may use information gathered through business intelligence to inform companies you work with as to how your company is run, in order to help them become more efficient and, by proxy, help you as well. If, for instance, you run a production company, making widgets or hamburgers or hinges or something similar, you’d want to share your production information with your sellers and retailers that will be selling your product – if they know, for instance, how much you have in inventory and how much you will have within the next week, they’ll be better able to plan how best to sell your product and, by doing so, help you both make more money than you would otherwise. Business intelligence is not always meant to be kept to oneself.
Basically, no one makes money in a vacuum. The whole point of economics and business management is that you’re working with some entity outside of yours – they need something, which you give them. There are other companies out there that have things you need, which you take from them. Everyone gets paid, wealth balances, and value is created where there was none before. Time and ingredients, mixed skillfully, create wealth. Business information just helps you create more of it, faster than ever before.
Business Intelligence Technologies
Not surprisingly in this highly technological age, business intelligence processes and systems in the modern workplace are almost always run through the use of computers and other automated systems. The computer gathers data in a regulated and regular process, as accurately as technology can allow for, and that data can then be accessed by management officials in the company with access to the computer system running the business intelligence programs in the company database.
Business intelligence computer systems generally depend on several highly specialized and advanced pieces of software to operate effectively and meant to analyze several very specific types of data. Those data types include production metrics – things like time of production for one unit, cost of materials, cost of production, and even things like power and raw material costs – sales statistics – the way things work on the sales end, like price of wages for employees, cost of checkout equipment, that sort of thing – and things like customer statistics and basic inventory information blocks.
After the data itself have been collected and gathered, software is sometimes also implemented in order to improve business performance management. Software uses applications like associative logic, performance monitoring, and similar algorithms to monitor the complex masses of data and boil them down to something useable for the high level execs responsible for making sure things get done in the upper echelons of a company or corporation.
The History of Business Intelligence
Believe it or not, business intelligence has been around a lot longer than the technology used today for it has. If you look back into the ancient mists of history, you’ll find a small book written by a brilliant Chinese general. The general’s name was Sun Tzu, and his famous little book is the celebrated The Art of War. The Art of War emphasizes the importance of intelligence and information in war – but the book isn’t useful for only war. Even today, high level executives and managers read that book, precisely because it is useful in situations of any sort of conflict – and Sun Tzu’s advice about information is particularly applicable in the business world.
The term “business intelligence” itself was coined in 1989 by Howard Dresner, a Research Fellow at the Gartner Group, an information and technology research group headquartered in Stamford, Connecticut. It was essentially an umbrella term to cover a number of methodologies and ideas designed for the increase of efficiency and profitability in the corporate workplace.
Business Intelligence Today
Today, business intelligence relies heavily on data and data processing. The computer is foremost in this process, and any business intelligence analyst would be foolish to ignore the use and practicality offered by computer technology. Software, as we’ve said, collects data and interprets it for the CEO or other managers of a company, making sure that company outdoes its competitors and knows exactly how its own internal affairs are being run. A human can improve him or herself by introspection; the same goes doubly for a company or corporation.
Business Intelligence Tomorrow
The world is changing, whether we want it to or not. Computers are getting faster, as are cars, planes, and nearly everything else in this world. The human race is speeding up – your customers will want more for their money, and they’ll want it faster than ever before. The attention span of the average American, or so they say, has gone down to about fifteen seconds – if you can’t make a product fast and exciting, you’re going to fall in second place to someone who can.
Business intelligence can help predict the trends of the customer base even as they shift, faster and faster every day. It’s that fast shift, as fast as lightning sometimes, which makes business intelligence vital. Business intelligence itself is shifting as a process and an ideology to conform to the faster, more demanding rigors of the modern and future economy.
On the cutting edge of the business intelligence of tomorrow is a new type of process, suggested by information analyst Andy Hayler – Business Intelligence 2.0. This new sort of business intelligence wouldn’t just gather and analyze data, but would also do it in real time – in other words, you’d be able to see a shift in profits or customer dynamics as it happened. On the other side of that process, technological automated systems would be built in place to instantly move to remedy the problems that did arise.
Problem; Solution
This kind of automation is, in essence, the very heart and soul of what makes business intelligence so vital to the modern businessman. It used to be that a company could be around for centuries with the same customer base. There will always be rich old retirees who need a place to store their money; thus, there will always be banks. For a long time, that was all that was needed, and the only business intelligence any banker needed had been written decades earlier in economic books, studies, and journals.
These days, it’s not so easy. Customers need a lot, are demanding, and shift with the wind. People simply aren’t fast enough to watch, observe, report, and change. If you tried to do that, you’d always be behind the curve – you’d be reacting to the fad that happened to iterations ago, and be continually producing a product that was already obsolete. As customers shift faster and faster, business intelligence and business activity monitoring is shifting to adapt to that faster, more volatile customer base.
This kind of adaptability is exactly what you and your company needs. Good intelligence leads to good processes, which leads in turn to good profits and a faster, more efficient workplace. Be smart, and make your company smarter – technology, automation, and the other cybernetic nerves that make the modern corporate brain tick are absolutely essential, and you and every businessman should make sure you are taking full advantage of the services they have to offer. If you educate yourself and stay on the crest of the waves of change, you’ll come out ahead and on top every time, and be an economic force to reckon with.
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