Business and IT decision makers need to maintain a clear distinction between true BI and gratuitous data. This research note provides that delineation by addressing the following key areas:
• A working definition of BI – what it is and what it is not.
• A summary of common BI tool types, with examples.
• Key considerationsprior to adoption.
• Recommendations for high-level BI planning.
IT and business leaders can leverage this information to develop a solid grasp of BI and ensure the initiative does not stray too far from the core principles.
Business Intelligence (BI) is rapidly becoming one of the most overused terms in IT. More and more software vendors are claiming that their products have BIcapabilities; a growing number of consulting firms offer BI optimization assessments. Part of the explanation for this trend is that BI as a concept involves both business processes and enabling technologies that can be implemented in a variety of ways with different levels of complexity. Enterprise decision makers need to fully understand what BI is before they can decide what to do about it.What It Is & How It Works
There is a common tendency to equate BI with the set of proprietary technologies that bear the same name. However, organizations that do not make use of a major vendor toolset can still engage in BI activities. At its core, business intelligence is both a set of processes and technologies aimed at improving strategic and operational decision making by leveraging enterprisedata.
Business Intelligence (BI) is…
• A process involving the consolidation, analysis, and communication of business information to assist business decision making.
• A technology which consists of a variety of tools that automate data consolidation, analysis, and the presentation of business information to end users.
Understood this way, even organizations that make use of simplespreadsheets can be engaged in BI. What matters is that enterprise data is being strategically used to provide better insight on the state of the business and/or the marketplace. Although other enterprise applications, such as customer relationship management (CRM) and enterprise resource planning (ERP), provide information for decision support, data is typically fragmented and the systems are not tightlyintegrated. By bringing together data from disparate sources, BI offers an enterprise view (a single version of the truth) of the state of the business.
Business Intelligence is not…
• A source of business information. BI tools do not create their own raw data – they collect and work with data generated by other enterprise systems.
• Reporting alone. A tool must contribute toward businessdecision making to be considered BI. Reports generated for strategic analysis are part of the BI process. Routine operational reports are not. The same principle applies to all BI-related technologies. Without strategic intent, a tool is just a tool – not BI.
• Content intelligence (CI). BI works with standardized structured data, while CI tools provide insight into unstructured data. There have beenattempts to fuse BI and CI together, but none have taken hold in the enterprise market to date.
Component BI Tools
Generally speaking, the component BI tools can be partitioned into three distinct categories:
• Data consolidation tools (back-end technologies).
• Analytical tools (data manipulation tools).
• Presentation tools (front-end technologies).
Figure 1. BI Tool Spectrum
Source:Info-Tech Research Group
Figure 1 describes the most common BI tools that fall under the BI tool categories. It is important to reiterate that the spectrum of BI implementations varies enormously. As a result, the list of tools in Table 1 is not intended to define a standard BI implementation. Organizations will tend to adopt toolsets as they are needed.
Table 1. Business Intelligence...