Business intelligence can be defined as a set of business processes designed to garner and analyze business information. It is a vast category of application of programs that includes providing access to data to help an entrepreneur in his business decisions, task of query and reporting, online analytical processing (OLAP), statistical analysis, forecasting and data mining.
Big and small companies collect information to assess the business environment i.e. to acquire a sustainable competitive advantage in the business environment and also cover the areas of marketing research, industry research and competitive analysis. Every business intelligence system has a particular purpose (be it short term or a long term purpose) based on a vision statement or organizational goal.
Business intelligence involves different strategies. The BI task can be handled with the aid of application software. Application software is broadly categorized under class of computer software that enables a computer to function in accordance with what the user desires. The application software is different from the system software that integrates different capabilities of the computer but these are not directly applied to the benefit of the user. The application software is designed to help people be prudent in taking decisions by imparting them accurate, current and requisite information. This is precisely the reason that business intelligence is also referred to as ‘decision-support system’ or DSS.
While framing and implementing a business intelligence program there are several crucial points to be borne in mind.
a) The goal or the purpose of the program, in simple terms the goal of the organization that the program will address should be considered. There should be a rough idea of how can the program will lead to better results.
b) Secondly the expense of adopting a new business intelligence program should be estimated. Along with this the risk involved in the business intelligence program should also be calculated and so planning should be done accordingly.
c) A person should also know that who all will be direct and indirect beneficiaries and who will pay for the initiative. Also see what will be the quantitative and qualitative benefits and about employees, shareholders, distribution channels etc.
d) The information so gathered must be tracked into well-defined metrics. A person should be sure of the kind of metrics adopted, its standardization and its performance.
e) A person should establish a procedure to reach the ideal way of measuring the requisite metrics. In this you must also acknowledge what methods to be adopted and the pace at which the organization will collect the data. Make sure that you know about existing industry standards if any and the best way to do the measurements.
f) The business intelligence program should be carefully governed to ensure completion of the desired targets. You may have to make several adjustments or modifications in the program from time to time. The business intelligence program should also be tested for accuracy, reliability and validity. One should also know that how the business intelligence initiative entails a variation in results and how much change was a chance product.