Have you heard the term business intelligence (BI) lately? Are you unsure what it means? Business intelligence is taking off in a high-tech way, becoming the center of the industry.
If you’re looking to improve upon your business model or expand upon your capabilities, business intelligence could be the right choice for you. BI comes with an abundance of benefits that can help you grow your company, but it also has some drawbacks.
What Is Business Intelligence?
Business intelligence is the systems and technology that enterprises use to collect data analyses about the company. Think of it as the infrastructure of your enterprise. It will collect and analyze the company’s data and present it for you to use to your advantage. Some of its processes include predictive analysis, performance management, data mining, event processing and much more.
BI is a method of guiding business planning through metrics in comparison to your past operational data. It’s similar to business analytics (BA), and people sometimes interchange the two terms. However, BA has less control over large chunks of data. Both are very similar in their functions and features, but BI tends to have more capabilities to help future planning because of its range of information gathering systems.
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How can business intelligence help, and why are people talking about it more and more? You can use the information it provides to understand business insights, work around supply and demand and improve upon marketing strategies.
BI offers some benefits. With them, you can transform the future of your enterprise.
Benefits of BI
Business intelligence can help with several different aspects of your organization. From hiring and productivity to advertising and marketing, BI offers data metrics that improve it all.
One of the primary benefits of BI is decision-making. Because of its range of data and metrics collection, you can use it to decide where to take your company in the future. It influences what products or services you market and when.
It can change how you advertise, too. If you find that customers are responding better to some forms of marketing over others, you may choose to focus your resources on the popular method. With these analytics, BI can change the direction of your enterprise for the better.
2. Productivity Boost
BI can take time-consuming tasks and make them mindless. Something like manual data collection could take hours, days or weeks. BI systems gather and organize that information instantly.
As you let business intelligence take over these time-consuming responsibilities, you and other employees will have more hours to focus on other pressing projects. For instance, workers could develop new marketing strategies based on the BI information instead of doing the data collecting themselves.
3. Financial Improvements
BI can offer two different forms of economic benefits and improvements. First, the reorganization of priorities and responsibilities can lead to decreased staff costs. If you implement BI into your enterprise, you won’t have to hire additional employees to do the work that BI takes care of.
Second, with optimized data and metrics, you can see where to invest your time and resources. If a certain product is doing well, you can promote it knowing it’s worth the investment. Then, with more recognition, you may see additional customers purchasing the product.
Drawbacks of BI
Though there are benefits to BI, it does come with drawbacks as well. The price, practicality and complexity are areas that small- and medium-sized enterprises are skeptical of.
One of the main cons for business owners who want to invest in BI is the price. Primarily, the technology is something only bigger companies can afford. It’s expensive, so smaller operations don’t always have the resources to purchase it.
Small- and medium-sized businesses typically choose to gather data in traditional ways. Though some developers are trying to lower prices and target smaller organizations, it still may come off as too expensive and not worth it.
Many smaller businesses choose to invest in needs that are more pressing to their sales or customer base. For instance, a florist may want to invest in refrigerators or vases for their flowers before looking into BI.
Larger companies tend to benefit more from the technology as they have the financial resources. Developers must still convince small- and medium-sized organizations that BI can be a practical solution and worth the price. If not, costs will need to drop more before developers can expand their client base.
A con that affects companies of any size is the complexity of BI. If they do choose to purchase a system, the next step is setting it up. Yet many find that implementing it into their business model can be tricky.
While operating and understanding the system itself can take a while to adjust to and integrate, the solutions take time as well. From months to years, BI projects can be time-consuming and not as instant as many organizations may need.
Examples and Applications
If the pros and cons didn’t sway you to one side or another, consider these real-life examples and applications of BI.
In a general sense, BI can help retail stores and businesses. A BI interface can let you know what to market, how to advertise it and who to sell it to. These metrics can come in any form, as well.
Something like a “people counter” can help with retail store traffic statistics as you measure consumer behavior. This information can help with things like tweaking marketing strategies and increasing engagement.
HelloFresh is a meal-kit company that operates through the internet and apps. They implemented a BI system when their market reporting process became too time-consuming and unproductive.
This transition allowed them to use real-time data to their advantage. From there, the marketing team had more time to create advertising campaigns.
3. Des Moines Schools
Public schools in Des Moines, Iowa, were having difficulty with administration issues when they turned to BI. Administrations couldn’t see real-time data about attendance or performance. And with some students dropping out, they needed a better system.
BI provided that opportunity as they used analytics to understand each students’ trajectory. With this technology, they could interpret the statistics and help with individual student experiences and give at-risk students the help they needed.
Is BI Right for You?
As you consider the pros, cons, examples and real-life applications, there are some questions to ask yourself before you invest. How practical is BI for your company? Do you have the financial resources to support the technology? How can BI improve your business model and marketing strategies?
Business intelligence is an investment, but depending on your needs or the size of your company, it could sway your decision to one side. Remember, the priority is your enterprise. Where you take it from here can brighten your organization’s future.
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