The business world is swimming in data and most businesses use various types of information to drive their decision making. The skill comes from gathering the right data and understanding what to do with it. Business intelligence leverages technology, not humans, to transform raw numbers into actionable insights that businesses can use. It helps you get to the story behind the data so you can make better business decisions.
What Is Business Intelligence?
Business intelligence is the art of delivering relevant, reliable and actionable information to the right people at the right time. The goal is to achieve better business decisions faster. To achieve this goal, businesses must create strategies for collecting raw data, structuring the data into relevant categories so it's easier to navigate, then turning the data into meaningful information that decision-makers can use. In other words, it's about taking your messy and disparate data from lots of different sources and putting it all in one place – typically a dashboard with clear visuals – so you can easily find what you need.
Example of Business Intelligence
The easiest way to understand BI is to use an example. Suppose you operate a retail business comprising an online store and a couple of bricks-and-mortar stores. You give customers a loyalty card which they can use in-store and when making purchases online. These cards push a massive amount of data about each customer's purchasing activity onto your company's databases. In itself, this information doesn't tell you very much. But with BI tools and software, you can quickly understand:
- What products your customers are buying and how often.
- Whether they prefer to shop in-store or online.
- How those preferences differ for the different products you sell.
- How loyal they are to your brand.
You can use these insights to predict a customer's needs and preferences, and thus develop better ways to sell, deliver service and create targeted marketing campaigns such as delivering coupons for a customer's favorite products.
What Skills Are Needed for Business Intelligence?
Despite the relatively simple explanation, business intelligence is a complex field involving data mining, analytics, business modeling and more. Some of the key skills include:
- Business acumen: You'll need to understand the business strategy, objectives and competitive environment to translate data into key performance indicators and other metrics that support tactical and day-to-day decision-making.
- Data analysis: BI uses data modeling to map information to the real world of the business. BI professionals often have a background in statistics.
- Technology skills:
- **++Proficiency in Microsoft Excel and off-the-shelf business intelligence software is essential if you are to convert raw data into tangible, real-life narratives. Proficiency in a query language like Microsoft SQL is also beneficial.
Business Intelligence Tools to Use
Smaller businesses that are just starting out with business intelligence can choose from a long list of vendors offering self-service business intelligence tools. Microsoft, Qlik and Tableau are market leaders; other vendors like Sisense and DBxtra specifically target smaller businesses that do not necessarily have a dedicated BI or technology team. These tools auto-create interactive dashboards and reports in a few minutes and the selling point is, you don't need any programming skills to operate them. There are lots of tools on the market – look for those that offer a free trial period so you can try before you buy.