What is business intelligence? Transforming data into business insights

Business intelligence definition

Business intelligence (BI) is a set of strategies and technologies enterprises use to analyze business information and transform it into actionable insights that inform strategic and tactical business decisions. BI tools access and analyze data sets and present analytical findings in reports, summaries, dashboards, graphs, charts, and maps to provide users with detailed intelligence about the state of the business.

The term business intelligence often also refers to a range of tools that provide quick, easy-to-digest access to insights about an organization’s current state, based on available data.

Benefits of BI

BI helps business decision-makers get the information they need to make informed decisions. But the benefits of BI extend beyond business decision-making, according to data visualization vendor Tableau, including the following:

• Data-driven business decisions: The ability to drive business decisions with data is the central benefit of BI. A strong BI strategy can deliver accurate data and reporting capabilities faster to business users to help them make better business decisions in a more timely fashion.
• Faster analysis and intuitive dashboards: BI improves reporting efficiency by condensing reports into dashboards that are easy for non-technical users to analyze, saving them time when seeking to glean insights from data.
• Increased organizational efficiency: BI can help provide holistic views of business operations, giving leaders the ability to benchmark results against larger organizational goals and identify areas of opportunity.
• Improved customer experience: Ready access to data can help employees charged with customer satisfaction provide better experiences.
• Improved employee satisfaction: Providing business users access to data without having to contact analysts or IT can reduce friction, increase productivity, and facilitate faster results.
• Trusted and governed data: Modern BI platforms can combine internal databases with external data sources into a single data warehouse, allowing departments across an organization to access the same data at one time.
• Increased competitive advantage: A sound BI strategy can help businesses monitor their changing market and anticipate customer needs.

Business intelligence examples

Reporting is a central facet of BI and the dashboard is perhaps the archetypical BI tool. Dashboards are hosted software applications that automatically pull together available data into charts and graphs that give a sense of the immediate state of the company.

Although business intelligence does not tell business users what to do or what will happen if they take a certain course, neither is BI solely about generating reports. Rather, BI offers a way for people to examine data to understand trends and derive insights by streamlining the effort needed to search for, merge, and query the data necessary to make sound business decisions.

For example, a company that wants to better manage its supply chain needs BI capabilities to determine where delays are happening and where variabilities exist within the shipping process. That company could also use its BI capabilities to discover which products are most commonly delayed or which modes of transportation are most often involved in delays.