What is Business Intelligence? Definition, tools and areas of application
In today's data-driven business world, Business Intelligence (BI) has become an indispensable tool for making informed decisions. This article offers you a comprehensive insight into the world of business intelligence and shows you how you can use this technology profitably in your company.
The definition of business intelligence
Business intelligence refers to the systematic collection, analysis and presentation of business data to optimize decision-making processes. It is a holistic approach that combines technologies, applications and methods to transform company data into usable insights. Further information on the basic definition of business intelligence can be found here. Modern business intelligence goes far beyond mere reporting. It enables companies to identify trends at an early stage, minimize risks and proactively exploit opportunities. By integrating various data sources and advanced analytical methods, companies can now make more precise predictions and adapt their strategies accordingly.
One particularly important aspect is the democratization of data within the organization. Modern BI solutions enable employees without in-depth technical knowledge to gain and utilize data-based insights.
The business intelligence life cycle
The BI lifecycle consists of several phases that build on each other and enable a continuous improvement process.
Data collection and integration
The basis of every BI solution is the systematic collection of relevant data from various sources. These can be internal (such as ERP systems or CRM databases) or external (such as market research data or social media analyses). The biggest challenge is to standardize these heterogeneous data sources and bring them together in a consistent structure.
An increasingly important aspect is the use of external data sources to analyse the market and competition. Methods of automated data collection and processing help companies to efficiently analyse relevant information and incorporate it into their strategic decisions.
Data preparation and quality assurance
After collection, the data must be cleansed and standardized. This process includes the elimination of duplicates, the correction of errors and transformation into a standardized format. The quality of the subsequent analyses depends largely on the care taken in this phase.
Analysis and interpretation
Various analysis methods are used in this phase:
- Descriptive analysis: Description of the current status
- Diagnostic analysis: Investigation of cause-and-effect relationships
- Predictive analysis: prediction of future developments
- Prescriptive analysis: Derivation of recommendations for action
By using modern AI-supported analysis methods, companies can identify market trends at an early stage and make well-founded strategic decisions.
Modern business intelligence tools
Choosing the right BI tool is crucial to the success of your business intelligence strategy. Leading solutions on the market offer different focal points and functionalities.
Microsoft Power BI
Power BI has established itself as one of the market leaders in the BI sector. The solution is characterised by its intuitive user interface and seamless integration into the Microsoft product family. The extensive visualisation options and AI-supported analysis functions are particularly noteworthy.
SAP BusinessObjects
SAP BusinessObjects is particularly widespread in large companies. The platform impresses with its scalability and deep integration into SAP systems. It offers advanced functions for enterprise reporting and independent data exploration.
Practical areas of application for business intelligence
Business intelligence is used in almost all areas of a company. Here are some of the most important areas of application:
Sales and marketing
- Customer analysis and segmentation
- Sales forecasts and trend analyses
- Performance tracking of marketing campaigns
- Optimization of the customer journey
Finance and controlling
- Budget planning and control
- Cost analysis and optimization
- Cash flow management
- Risk assessment
Supply chain and logistics
- Inventory optimization
- Supply chain analysis
- Quality control
- Process optimization
The targeted use of business intelligence offers considerable advantages, particularly when it comes to analysing the market and competition. Automated processes for collecting and analysing external data enable companies to make strategic decisions on a broader information basis.
The future of business intelligence
The business intelligence industry is constantly evolving. According to a study by Straits Research, the global BI market will reach a volume of over 40 billion US dollars by 2030. The following developments are particularly exciting:
Integration of artificial intelligence
AI technologies are significantly expanding the possibilities of BI systems. Machine learning algorithms can recognize patterns that are not obvious to humans and automatically generate recommendations for action.
Augmented analytics
This new generation of BI tools uses AI and natural language processing to make data analysis even more accessible. Users can ask their questions in natural language and receive automatically generated insights.
Conclusion and outlook
Business intelligence has evolved from a pure reporting tool to a strategic asset that helps companies remain competitive in the digital age. The key to success lies in the right combination of technology, processes and people.
A step-by-step approach is recommended for companies that want to develop or optimize their BI strategy:
- Taking stock of the current data situation
- Definition of clear goals and KPIs
- Selecting suitable tools and technologies
- Training and involvement of employees
- Continuous evaluation and adaptation
