Business intelligence definition and solutions

With the passage of time, we have been observing the need for organizations to have timely information at the exact moment that is required, and over the years the technology has evolved to adapt to those needs, thus favoring companies where large volumes of information are handled.

We live in a world where databases are believed or believed to be the main tool that provides information about departments. From this, what is known as Business Intelligence or Business Intelligence arises.

BI (Business Intelligence) is what gives value to this information, since it turns it into knowledge and then uses it to make decisions in a more efficient and correct way.

This information that arises is very valuable, since thanks to it it is possible to know the current situation of the company, know its past and be able to predict its future in order to solve problems and make decisions.

All this process of extracting, transforming and reading this information is carried out through a Business Intelligence study, in which all the information that exists is collected, analyzed and understood.

Keywords:

Business IntelligenceBusiness IntelligenceData warehouseInformation repositoryStrategy

What is Business Intelligence?

An interesting definition for Business Intelligence or Business Intelligence, according to the Data Warehouse Institute, is the «combination of technology, tools and process that allow transforming the stored data into information, this information into knowledge and this knowledge to direct it to a business plan or strategy ».

Business intelligence should be a part of the business strategy, since it allows you to optimize the use of resources, monitor the fulfillment of company objectives and have the ability to make good decisions to obtain better results.

(Oracle)

The main objective of Business Intelligence is to support organizations in a sustainable and continuous way to improve their competitiveness, thus facilitating the information necessary for decision-making.

The first person to use this term was Howard Dresner who, as a Gartner consultant, made the term BI popular as an umbrella term to describe a set of concepts and methods that would improve decision-making but using information about what had happened (facts).

Through the use of BI technology and methodologies, it is intended to convert data into information and from it be able to discover knowledge.

Another definition of BI starts from Gartner's glossary of terms, where it describes what it describes as:

"BI is an interactive process to explore and analyze structured information about an area (usually stored in a datawarehouse), to discover trends or patterns, from which other ideas are derived and conclusions are drawn. The BI process includes communicating discoveries and making changes. The areas include clients, suppliers, products, services and competitors ». (Gartner, 2006)

The origin of BI is linked to giving direct access to information to business users to assist them in decision-making, without involving the Information Systems departments.

(Lluís Cano)

During the last years, the BI market has been marked by a clear evolution that marks it as a mature market. Some clear examples are:

That there has been a consolidated purchase of small companies by the main market players such as: IBM, SAP or Microsoft.

New companies with a focus on innovation have emerged, thus filling new niches in the business intelligence market.

They have also been enriched with some open source solutions which cover the needs of an organization or company to allow them to exploit the information.

Business intelligence

The context of the information society in which we live has led to the need for more and better methods to extract and transform the data of an organization or company into information, to distribute it throughout the entire value chain.

Business intelligence responds to this need, so it can be understood that it is an evolution of decision support systems. However, while considered critical, it is not new.

In the month of October 1958, Hans Peter Luhn, who was a researcher at IBM, defined the term how: "The ability to apprehend the factual relationships presented in such a way as to guide actions towards a desired goal."

Since those times, the term BI has been evolving, so the following definition has been reached:

"Set of methodologies, applications, practices and capabilities focused on the creation and administration of information that allows better decisions to be made by the users of an organization".

(Curto Díaz, 2010)

Business Intelligence Technologies

Here are some technologies that may be part of BI:

Data warehouse Visual analysis Predictive analysis Dashboard Data mining Performance management Dashboards Data integration Forecasts Business rules Balanced scorecard

Benefits of a business intelligence system

The fact of implementing this type of system in organizations brings with it several benefits, among which are:

They allow a unique, shaped, historical, persistent and quality vision of all the information. They create a virtuous link of information (since the information is collected, to generate knowledge, which will allow us to make better decisions, this translates into better results. and new data are generated). They provide updated information at an aggregated and detailed level. Create and manage key performance indicators and key goal indicators, fundamental for the company. It improves the understanding and documentation of information systems in the context of an organization..Reduces the orientation differential of a business between the information technology department and the organization.Improves the competitiveness of an organization since they are capable of:faster access to information Have greater agility for decision-making Differentiates the relevant from the superfluous.

(Curto Díaz, 2010)

Ultimately, a complete business intelligence solution enables:

Observe, what is happening? Understand why it is happening? Predict, what will happen? Collaborate, what should the team do? Decide, which way to go?

(Sinnexus, 2007)

Work methodology

(Information Technology Directorate) Among the main activities considered for a Business Intelligence project are:

Model Design Report Design Administrative Opening Model Building Data Review Universe Creation Report Building Certification Administrative Closure Historical Data Upload

Business Intelligence solutions

Business Intelligence answers some basic questions through which it will provide a solution:

Historical BI: What Happened Analytical BI: What Happened and Why Predictive BI: What Can Happen?

Historical Business Intelligence Solutions

Through this type of process, the set of products that are optimal for each department in each of the organizations could be decided. In this, the data is collected from the applications that process transactions and their subsequent analysis to help the decision maker understand what happened and from the construction point of view, these are the simplest.

Analytical Business Intelligence Solutions

In this case, it is generally an iterative process, since the data is collected from the systems but real-time data is added to finally do the process through trial and error.

Such an app could help a manager fine-tune their pricing and promotion policies on a daily basis, based on their box data along with inventory levels in a store and at a distribution company.

Predictive Business Intelligence Solutions

These applications allow integrating data from sources both internal and external to the organization, as well as statistical and mathematical tools, to generate information about possible future events.

Obviously, this type of application is not easy to build, so the most popular applications are those that try to foresee the future by projecting historical data.

However, despite the fact that many organizations have adopted BI solutions so far, they have not been able to achieve a competitive advantage.

(Uceda Martos, 2006)

Business Intelligence architecture solution

Illustration 1 Business Intelligence Architecture (Oracle)

The first figures or drawings (analyzing it from left to right) represent the different data sources and can be used to extract data from multiple sources simultaneously.

The second drawing represents the extraction, transformation and loading process known as ETL. This process is where the sources are defined which fields will be used, if they will be modified or transformed and also where you want to locate that data, this process is known as mapping.

The third represents the drawing repository, which is where the transformed data is stored and is represented by means of visual models.

Finally, there is a process between the data repository and user access, it allows interaction with the data and graphically representing those results of the consultations and the management indicators that were constructed.

When is Business Intelligence necessary?

(Curto Díaz, 2010) There are some situations in which the implementation of a BI system is adequate. These include:

If information quality problems are identified, Excel is used as a repository for corporate or user information. What is known as Excel chaos. Decision making is done intuitively in organizations. Avoid information silos. There is a need to cross information quickly between different departments. Marketing campaigns are inefficient due to the information that use as a base. It is necessary to automate information processes and the distribution thereof.

To summarize, BI systems seek to answer the questions:

What happened? What happens now? Why did it happen? What will happen?

Business Intelligence strategy

It is possible to detect if there is no BI strategy in an organization through the following points:

Management considers Business Intelligence to be another cost center. The IT department is perceived by users as the source of their business intelligence problems. The BI system is supported by the help desk. The IT department continues Asking end users about reporting needs There is no center of competence. Someone believes that it is a success that consolidated information is available to end users after two weeks. Data warehouse users believe that the information is not correct.

The development of a business strategy is a process that is considered long-term since it includes multiple activities, among which are:

Establish BI standards in the organization to rationalize existing technologies such as future acquisitions. Include results of analytical applications (data mining or any other) in business processes with the sole objective of adding value to decisions. Review and evaluate the current portfolio that exists about solutions in a context of risk or rewards. Evangelize the organization. Pay special attention to the needs that require BI in the organization because it tends to satisfy users or departments that shout louder, for example those of finance.

(Curto Díaz, 2010)

conclusion

If an organization has an efficient Business Intelligence system, it can obtain many benefits from its implementation and management, for example, obtaining a vision of how its business has evolved and progressed, in order to have information and knowledge available to be able to take decisions.

Thus, the information will be available at any time in real time, allowing organizations to detect opportunities and act on them.

It is also possible to prepare some action plans and focus strategies based on the data generated daily, and everything is possible thanks to Business Intelligence and the tools through which it can be applied.

Implementation of Business Intelligence through data mining.

General objective

Implement Business Intelligence through data mining in an organization for improvement in decision making.

Thanks

To the National Technological Institute of Mexico for being my alma mater and to Dr. Fernando Aguirre y Hernández for their support and motivation to write these articles on the subject of Fundamentals of Administrative Engineering.

References

Curto Díaz, J. (2010). Introduction to Business Intelligence. Barcelona: Editorial El Ciervo.

Information Technology Directorate. (sf). University of Concepción de Chile.

Retrieved on April 2016, from

Gartner. (January 2006). Retrieved April 2016, from www.gartner.com

Lluís Cano, J. (sf). BUSINESS INTELLIGENCE: COMPETE WITH INFORMATION. Esade Business School.

Oracle. (sf). Retrieved April 2016, from http://www.oracle.com/ocom/groups/public/@otn/documents/webcontent/3175 29_esa.pdf

Sinnexus. (2007). Business Intelligence. Retrieved on April 2016, from Strategic Computing:

Uceda Martos, P. (2006). Business Intelligence: Approach to an application experience in institutions in the region.

Business intelligence

Data warehouse: Information repository.

The value chain, by Michael Porter, is a theoretical model that allows describing the activities that generate value in an organization.