Information Systems Today: Chapter # 5

Information Systems Today
Eighth Edition, Global Edition
Chapter # 5
Enhancing Business
Intelligence Using Big Data
and Analytics
Copyright © 2018, 2016, 2014 Pearson Education, Ltd. All Rights Reserved
Learning Objectives
• 5.1 Describe the need for business intelligence and advanced analytics and
how databases serve as a foundation for making better business decisions.
• 5.2 Explain core concepts of business intelligence and advanced analytics.
• 5.3 Describe how organizations can enhance decision making by using

knowledge management and geographic information systems.
Enhancing Organizational Decision Making
• Learning Objective: Describe
the need for business intelligence
and advanced analytics and how
databases serve as a foundation
for making better business
decisions.
• Why Organizations Need Business Intelligence and

Advanced Analytics
• Databases: Providing Inputs into Business Intelligence
and Advanced Analytics
Business Intelligence, Advanced Analytics,
Business Analytics
• Looking back and answering important questions require
analyzing data of past and current transactions to
understand what happened
• Business Intelligence (BI) refers to tools and techniques
for analyzing and visualizing past data
• Advanced analytics refers to tools and techniques used
to understand why something happened, predict future
outcomes, or discover hidden patterns in large data sets
• Business analytics is used as an umbrella term for all
these concepts
Business Intelligence and Advanced
Analytics (Table 5.1)
• The need for business intelligence and advanced analytics
goes beyond traditional businesses; rather all types of
organizations utilize it to improve their data-driven
decision making as seen in the examples below
Context Example
Political parties Model the influence of social media on election
outcomes
Government Analyze performance of public benefits programs
Defense Manage maintenance and logistics during overseas
deployments
Hospitals Predict patient volume and resource utilization
Nonprofit organizations Manage fundraising campaigns and target donors
Big Data
Understanding Big Data
• Businesses are dealing with the challenge
of “Big Data”
– High Volume
▪ Unprecedented amounts of data
– High Variety
▪ Structured data
▪ Unstructured data
– High Velocity
▪ Rapid processing to maximize value
Databases: Providing Inputs into Business
Intelligence and Advanced Analytics
• Data and knowledge are an organization’s most
valuable resource
• Enabling interactive Web sites using databases:
– E-commerce makes extensive use of databases
– Product catalog data are stored in databases and
available to users
– Customer billing and shipping
– E-commerce applications process millions of
transactions per day
Databases: Foundation Concepts
Databases: Tables and Records
This sample data table for the entity Students includes 7 attributes and 10 records
Source: Microsoft Access
Databases: Advantages (Table 5.2)
Advantages Description
Minimal data redundancy There is a single copy of the data
Improved data consistency Eliminating redundancy improves consistency
Increase security Simplifies enforcement of access restrictions
Improved data quality Centralized control, minimized redundancy, and
improved data consistency enhance data quality
Improved data accessibility A centralized system makes it easier to deploy and
and sharing control access in or out of the organization
Enforcement of standards Centralized data management standardizes rules
Program-data independence Easier to evolve and alter software to changing
business needs when independent
Increased productivity of Data standards make it easier to build and modify
application development applications
Reduced program maintenance Changes in data replicate seamlessly
Databases: E ective Management
• The Data Model
– What data will be captured
– How the data will be represented
• The Data Dictionary
– Document of database metadata
▪ Attribute name
▪ Type of data
▪ Valid values
▪ Business rules
Databases: Entering and Querying Data
Online Transaction Processing
• Online Transaction Processing (OLTP)
– Systems that interact with customers and run a
business in real time
• Data Warehouses
– Integrate data from multiple database and other
data sources
– Contain historic as well as current data
• Data Marts
– Subset of a data warehouse, limited in scope
Operational vs. Informational Systems
(Table 5.4)
Characteristic Operational System Informational System
Primary Run the business on a Support managerial decision
Purpose current basis making
Type of data Current representation of Historical or point-in-time
state of the business (snapshot)
Primary users Online customers, clerks, Managers, business analysts,
salespersons, administration and customers (checking
status and history)
Scope of Narrow and simple updates Broad and complex queries
usage and queries and analyses
Design goal Performance Ease of access and use
Data Warehouses: Extract, Transform, Load
Building a data warehouse involves integrating data from multiple sources.

Extracting is the process of obtaining the necessary data. Transformation is
done to ensure that the data are in a common format and are free of errors.
Finally, the extracted and transformed data are loaded into the warehouse for
use by decision makers.
Business Intelligence and Advanced
Analytics
• Learning Objective: Explain
core concepts of business
intelligence and advanced
analytics.
• Business Intelligence
• Advanced Analytics
Business Intelligence Tools
• Decision Support Systems
– Used to support decision making at all levels
in the organization
• Online Analytical Processing (OLAP)
– Process of quickly conducting complex, multi-
dimensional analyses of data stored that is
optimized for retrieval usually using graphical
software tools
OLAP Terms and Concepts
• Measures
– Facts, numerical data that can be aggregated
• Dimensions
– Provides a way to summarized the data
– Hierarchically arranged to enable drill-down and roll-up
• Cubes
– Multidimensional structure of dimensions and measures
• Slicing and Dicing
– Analyzing data on a subset of dimensions
Information Visualization (Digital
Dashboards)
• Digital dashboards are
used to visually present
key performance
indicators used by
management
• Data usually highly
aggregate
• They use a variety of
design elements to
present data in a user
friendly way
Visual Analytics
• Visual analytics is the combination of various
analysis techniques and interactive visualization
to solve complex problems
Advanced Analytics
• Advanced analytics are designed to help users
gain a deeper understanding of why things
happen and then build predictive models to
support decision making
• Data science describes the advanced analytics
field of study and practice
• Advanced analytics are often used by business
analysts to take decisions out of their hands, thus
freeing up valuable resources
Data Mining
• Discovering “hidden” predictive relationships in the
data
• Complicated algorithms run on large data warehouses
• Types of data mining algorithms
– Association discovery
– Clustering
– Classification
– Text and Web content
mining
Text Mining
• Web content mining refers to

extracting textual information
from Web documents after-
which text mining is used to
apply analytical techniques to
produce useful reports
Data Mining Results
• Data mining
results can be
delivered to
users in a
variety of ways
Machine Learning
Intelligent Systems
• Artificial intelligence (AI) is the science of
enabling information technologies to simulate
human intelligence
• Intelligent agent (also called a bot) is a program
that works in the background to provide some
service when a specific event occurs.
– Examples include:
▪ Apple’s Siri
▪ Microsoft’s Cortana
Knowledge Management and Geographic
Information Systems
• Learning Objective: Describe
how organizations can enhance
decision making by using
knowledge management and
geographic information systems.
• Knowledge Management Systems

• Geographic Information Systems
Knowledge Management Systems
• Explicit knowledge
– Easily codified
and documented
• Tacit knowledge
– Embedded in
people’s minds
– Hard to get at
– Important for best
practices
Goal: gain the greatest value
from knowledge assets
Social Network Analysis
• Social network analysis is a technique that maps
people’s contacts to discover connections or
missing links within the organization
Geographic Information Systems
• A geographic information system (GIS) is a
system for creating, storing, analyzing, and
managing geographically referenced information
• GIS benefits greatly
from advances in
machine learning,
especially for
recognizing and
classifying
geographical features
END OF CHAPTER CONTENT

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Information Systems Today

Eighth Edition, Global Edition

• 5.2 Explain core concepts of business intelligence and advanced analytics.

• 5.3 Describe how organizations can enhance decision making by using

• Why Organizations Need Business Intelligence and

Building a data warehouse involves integrating data from multiple sources.

• Web content mining refers to

• Knowledge Management Systems

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