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Business Intelligence

Business Intelligence

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Published by sonuka

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Categories:Types, Business/Law
Published by: sonuka on Feb 27, 2009
Copyright:Attribution Non-commercial

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10/23/2010

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BUSINESS INTELLIGENCE
What is Business Intelligence?
Business intelligence (BI) refers to skills, knowledge, technologies, applications and practicesused to help a business to acquire a better understanding of the market behavior and businesscontext. For this purpose it employs collection, integration, analysis, interpretation and presentation of business information to support better business decision making. It is a criticalcomponent of a CRM strategy.
Is Business Intelligence strictly a CRM thing?
BI is not only confined to Customer Intelligence but is also found in product, services, supplychain, financial, and human resources intelligence. BI extends along the entire enterprise valuechain and has applicability in different forms to both commercial and government enterprises. Ascustomer records grow into millions and customer value rises to the top of the corporateobjectives hierarchy, Business Intelligence has grown multifold and has undergone atechnological evolution that mirrors the increasing complexity of analytics.
Isn't BI the same as Enterprise Reporting?
BI isn’t same as Enterprise reporting
.
Enterprise reporting
is merely the combination of multiple reports from multiple systems using a standard reporting tool and a common delivery platform, which means that it is an impartial information aggregator that grabs already analyzedand interpreted data from multiple sources and neatly ties the data together in a format thatmakes it readable where as
Business intelligence
is beyond this and involves the use of anorganization's disparate data to provide meaningful information and analysis to employees,customers, suppliers, and partners for more effective decision making.
Is BI the same as Predictive/ Descriptive Analytics?
Business intelligence uses both predictive and descriptive analytics, particularly the formerbut it isn’t the same thing
. The analytics features of business intelligence help present thatactionable information and help you make decisions. BI takes raw data and turns it intoinformation. It uses complex algorithms on captured data and makes some interpretive sense outof it. This information provides tremendously valuable input for developing the innovations andapproaches to improve customer experiences. Some of the general uses of business intelligenceaccording to the
OLAP (online analytical processing)
Report are:
Data warehouse reporting
Sales and marketing analysis
Planning and forecasting
 
Financial consolidation
Statutory reporting
Budgeting
Profitability analysisThe purpose of business intelligence is not really any different than any combination of  predictive and descriptive analytics. The basic purpose is to provide you with a set of results thatcan help you make a smart business decision.
What are BI's challenges?
The implementation of a BI project is not without challenges and many of the major challengesremain internal.
The major nonproduct challenge faced is company politics
. Experience has shown that singledepartment implementations are less challenging, but often result in fragmented, nonintegratedapproaches that, in the long run, increase interdepartmental issues instead of simplifying them.With any project, the user is very important and the interest of the user must be considered key to project success. The OLAP 3 report indicates that the inability to get users to agree onrequirements is a common problem with BI implementations and if the requirements are agreedupon, staying the course without changing the requirements proves difficult.
There are technological challenges too.
The dispersion of the data sources, the ‘dirtiness’ of thedata and lack of standards for a common data format, the disparate technologies that are beingused, the availability of web services – or not, the sufficiency of the hardware and software to dothe job, the sheer size of the total data available – all provide significant challenges to theapplication of those pesky and complicated analytic algorithms.
BI well done, Customer value received
If you meet the challenges that BI presents in a CRM environment, then the value of thecustomer Intelligence returned can be immeasurable. It helps you identify four basic customer value categories:
Customers to retain
 – These are the high value customers that should get the mostattention because they will provide the highest profitability.
Customers to acquire
 – These are the customers that have high value potential based ontheir segments and the relevance of the products or services of the offering company.
Customers to grow
 – These are the future high value customers that will become thecompany’s and its partners long term investment. These are strategic accounts.
Customers to harvest
 – These are low value, low margin customers or product/serviceofferings that can be gathered to the bosom of the company by optimized services or  pricing with a minimum of effort and investment.
 
Once you have this information, you have to plan to do something with it, not assume it isanother notch in a belt or a thing to be catalogued and forgotten.
 The Marketplace grows as the return Increases
The value of BI is becoming apparent to those interested in gleaning customerintelligence as part of their overall CRM initiatives
. BI is perhaps the hottest segment of the CRM market in 2004 and promises to be for several more years. It is a market that grewup to
$6 billion by 2005
. The value of tools in that they help companies understand andinfluence behavior.Aberdeen group found that approximately
19% of companies implementing BI claims theyhave met or exceeded their business goals
. More than
60% state they have at leastlargely me their goals
. As always, soft nonmonetary benefits were more easily obtainable,and even quantifiable, than hard revenue bearing benefits.Companies that had the data collection tools seemed to be willing to spend between $1million and $2 million on these analytic applications. In results it was found that those whohad deployed them were staggering.
While those who were using it could see 30%-70%improvement in response rates.
Business Intelligence begins to Verticalize
Business Objects, perhaps the BI industrys most significant player, has introduced asubstantial number of industry-specific business intelligence applications that cover consumer products, communications, energy, financial services, government/public sector,healthcare, manufacturing, pharmaceuticals, and retail. CRM- centric analytics-strongcompanies like Epiphany, Peoplesoft, Siebel and oracle follow similar industry- specific patterns in their offering including analytics. The idea of vertically smart BI would be to havealgorithms that deal with processes that are faithful to their industry only.
Business Intelligence and a real-time future
There is a BI holy grail. The vast majority of BI applications are not real-time at this stage.
They run their algorithms at some pre-determined time intervals and then slice anddice appropriately
. While well suited long-term planning and identifying customer segment,they are not suited that well for personalized real-time interactivity that most competitivecompanies want to maintain and gain an edge. The current generation works well with bothidentifying the state of the current customer database and evaluating the appropriatesegments for targeting campaigns.
Personalization = real time
Personalization is basically human touch without the actual interaction with a realhuman
. The best personalized engines are those that provide you with a
“warm and fuzzy”
experience and an associated good deal during your sojourn with a company through some

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