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Any information that pertains to the history, current status or future projections of a business
organization (Wiktionary).
Any information that can be of strategic use to an organization.
Constituents of BI
Business intelligence (BI) uses knowledge management, data warehouse, data mining and
business analysis to identify, track and improve key processes and data, as well as identify and
monitor trends in corporate, competitor and market performance.(
http://www.bettermanagement.com/topic/default.aspx?f=10)
Following the above, we can define business intelligence as information about an organization’s
past performance that is used to help predict the company's future performance. It can reveal
emerging trends from which the company might profit.
We are going to be creating a framework based on the above using knowledge management,
datawarehouse, data mining and business analysis as our inputs and map it to processes and data
as the intermediate.
Literature Review
Opportunity analysis
Intelligence for its own sake is of little business value unless it can provide actionable value. By
this it is meant that opportunity analysis should be the objective we strive for within Business
Intelligence. Opportunity analysis is an intelligence assessment relating directly to the
vulnerabilities and
opportunities of the organisation as they arise from circumstances within the operating
environment. The key element of opportunity analysis is the intelligence production unit's
understanding of the organisation's objectives. Being able to relate to the knowledge on hand and
to interpret that within the context of the organisation's strategic objectives - in effect by pointing
out the opportunities and vulnerabilities that decision-makers and marketing personnel can
exploit to advance the organisation and to improve customer relationships is crucial. The
standard is to provide actionable analysis without prescribing general guidelines. Opportunity
analysis depends upon two fundamental principles.2The first holds that opportunity analysis
starts with the effective tasking by intelligence consumers - in most organisations the consumers
are the users of intelligence. The consumers are responsible for identifying the relevant
intelligence priorities. The second principle postulates that in order to satisfy the needs
of the consumers, the intelligence producers must provide analytical assessments that deliver a
high order of understanding and insight that can support sound decision-making, customer
relationship building and strategy planning. This implies that intelligence adheres to a distinct
process.( )
More meaningful (but still confusing) results are obtained when prefixing analysis with data or
business. Wikipedia, for examples defines data analysis as “… a process of inspecting, cleaning,
transforming, and modeling data with the goal of highlighting useful information, suggesting
conclusions, and supporting decision making.” On the other hand, business analysis is defined
as: “The discipline of identifying business needs and determining solutions to business problems.
Solutions often include a systems development component, but may also consist of process
improvement or organizational change or strategic planning and policy development.” These two
definitions may explain why the IT and business views of analysis sometimes differ. IT often
defines data analysis as covering the complete information life cycle from cleaning and
transforming source data making it ready for analysis, to analyzing the transformed data and
creating analytics. Business users, on the other hand, view business analysis as a set of
techniques for defining analyses and creating analytics on the transformed data.
Definitions for analytics, metrics, measurements, and indicators offer a confusing set of options.
It is worth noting that analytics is more often defined as “the science of analysis” rather than the
“results of analytical processing.” Given that business intelligence is about providing business
users with intelligence about the business, we offer the following:
“Business analysis is the process of analyzing trusted data with the goal of highlighting useful
information, supporting decision making, suggesting solutions to business problems, and
improving business processes. A business intelligence environment helps organizations and
business users move from manual to automated business analysis. Important results from
business analysis include historical, current and predictive metrics, and indicators of business
performance. These results are often called analytics.”
Business intelligence reporting and monitoring includes ad hoc and standardized reports,
dashboards, triggers and alerts. Business analytics include trend analysis, predictive forecasting,
pattern analysis, optimization, guided decision-making and experiment design
BI&DM
Data mining is the process of extracting hidden knowledge from large volumes of raw data. It
can also be defined as the process of extracting hidden predictive information from large
databases.
Data mining is not an “intelligence” tool or framework. Business intelligence, typically drawn
from an enterprise data warehouse, is used to analyze and uncover information about past
performance on an aggregate level. Data warehousing and business intelligence provide a
method for users to anticipate future trends from analyzing past patterns in organizational data.
Data mining is more intuitive, allowing for increased insight beyond data warehousing. An
implementation of data mining in an organization will serve as a guide to uncovering inherent
trends and tendencies in historical information. It will also allow for statistical predictions,
groupings and classifications of data.
Most companies collect, refine and deduce massive quantities of data. Data mining techniques
can be implemented rapidly on existing software and hardware platforms to enhance the value of
existing information resources, and can be integrated with new products and systems as they
become part of the system. When implemented on high performance client/server or parallel
processing computers, data mining tools can analyze massive databases to deliver answers to
many different types of predictive questions.
Data mining software allows users to analyze large databases to solve business decision-making
problems. Data mining tools predict future trends and behaviors, allowing businesses to make
proactive, knowledge-driven decisions. Data mining tools can answer business questions that
traditionally were too time-consuming to resolve. Data mining is, in some ways, an extension of
statistics, with a few artificial intelligence and machine learning twists thrown in. Like statistics,
data mining is not a business solution, it is just a technology.
Data mining allows users to sift through the enormous amount of information available in data
warehouses; it is from this sifting process that business intelligence gems may be found.
BI&DW
Different people have different definitions for a data warehouse. The most popular definition
came from Bill Inmon, who provided the following:
Subject-Oriented: A data warehouse can be used to analyze a particular subject area. For
example, "sales" can be a particular subject.
Integrated: A data warehouse integrates data from multiple data sources. For example, source A
and source B may have different ways of identifying a product, but in a data warehouse, there
will be only a single way of identifying a product.
Time-Variant: Historical data is kept in a data warehouse. For example, one can retrieve data
from 3 months, 6 months, 12 months, or even older data from a data warehouse. This contrasts
with a transactions system, where often only the most recent data is kept. For example, a
transaction system may hold the most recent address of a customer, where a data warehouse can
hold all addresses associated with a customer.
Non-volatile: Once data is in the data warehouse, it will not change. So, historical data in a data
warehouse should never be altered.
This is a functional view of a data warehouse. Kimball did not address how the data warehouse is
built like Inmon did, rather he focused on the functionality of a data warehouse.
(http://www.1keydata.com/datawarehousing/datawarehouse.html)
Scott Howard’s Answer: Business intelligence refers to systems and technologies that provide
the business with the means for decision-makers to extract personalized meaningful information
about their business and industry, not typically available from internal systems alone. This
includes advanced decision support tools and back-room systems and databases to support those
tools. The data warehouse is that back-room database. Combine that with the support tools
required to build and maintain the data warehouse, such as data cleansing and extract, transform
and load tools and you have what many call data warehousing.
Think of the data warehouse as the back office and business intelligence as the entire business
including the back office. The business needs the back office on which to function, but the back
office without a business to support, makes no sense.
Chuck Kelley’s Answer: My 30,000-foot level answer – I think that you build a data warehouse
to put a tool on top of it to do business intelligence. So data warehousing is the foundation that
business intelligence is built upon.
Clay Rehm’s Answer: People were performing data warehousing (DW) before it had a name.
The term "data warehousing" stemmed from the terms "decision support" and "management
reporting" many years ago. Business intelligence (BI) sought to encapsulate more processes that
included data warehousing. If you notice, many vendors use the term BI to describe their
services; to show that they provide more services than just data warehousing.
Uses of BI
2. Forecasting
Many of you have no doubt run into the needs for forecasting, and all of you would agree that
forecasting is both a science and an art. It is an art because one can never be sure what the future
holds. What if competitors decide to spend a large amount of money in advertising? What if the
price of oil shoots up to $80 a barrel? At the same time, it is also a science because one can
extrapolate from historical data, so it's not a total guess.
3. Dashboard
The primary purpose of a dashboard is to convey the information at a glance. For this audience,
there is little, if any, need for drilling down on the data. At the same time, presentation and ease
of use are very important for a dashboard to be useful.
4. Multidimensional analysis
Multidimensional analysis is the "slicing and dicing" of the data. It offers good insight into the
numbers at a more granular level. This requires a solid data warehousing / data mart backend, as
well as business-savvy analysts to get to the necessary data.
This is diving very deep into business intelligence. Questions asked are like, "How do different
factors correlate to one another?" and "Are there significant time trends that can be
leveraged/anticipated?"
(http://www.1keydata.com/datawarehousing/datawarehouse.html)