Business intelligence vs.

business analytics

One thing you will have noticed from those examples is that they provide insights
into the current state of the business or organization: where are sales prospects in
the pipeline today? How many members have we lost or gained this month? This
gets to the key distinction between business intelligence and another, related term,
business analytics.

Business intelligence is descriptive, telling you what's happening now and what

happened in the past to get us to that state. Business analytics, on the other hand, is
an umbrella term for data analysis techniques that are predictive — that is, they can
tell you what's going to happen in the future — and prescriptive — that is, they can
tell you what you should be doing to create better outcomes. (Business analytics are
usually thought of as that subset of the larger category of data analytics that's
specifically focused on business.)

The distinction between the descriptive powers of BI and the predictive or descriptive
powers of business analytics goes a bit beyond just the timeframe we're talking
about. It also gets to the heart of the question of who business intelligence is for. As
the Stitchdata blog explains, BI aims to deliver straightforward snapshots of the
current state of affairs to business managers. While the predictions and advice
derived from business analytics requires data science professionals to analyze and
interpret, one of the goals of BI is that it should be easy for relatively non-technical
end users to understand, and even to dive into the data and create new reports.

For more, see “Business intelligence vs. business analytics: Where BI fits in your
data strategy.”

Business intelligence strategy

In the past, IT professionals had been the primary users of BI applications. However,
BI tools have evolved to be more intuitive and user-friendly, enabling a large number
of users across a variety of organizational domains to tap the tools.
Gartner’s Howson differentiates two types of BI. The first is traditional or classic BI,
where IT professionals use in-house transactional data to generate reports. The
second is modern BI, where business users interact with agile, intuitive systems to
analyze data more quickly.

Howson explains that organizations generally opt for classic BI for certain types of
reporting, such as regulatory or financial reports, where accuracy is paramount and
the questions and data sets used are standard and predicable. Organizations
typically use modern BI tools when business users need insight into quickly changing
dynamics, such as marketing events, in which being fast is valued over getting the
data 100 percent right.

But while solid business intelligence is essential to making strategic business

decisions, many organizations struggle to implement effective BI strategies, thanks
to poor data practices, tactical mistakes and more.

For more, see “7 keys to a successful business intelligence strategy” and “9 ways
you’re failing at business intelligence.”