Business Intelligence

BUSINESS INTELLIGENCE

This lesson intends to stress that data analysis process aims in

boosting business performances by helping corporate executives and
other end users make more informed decisions.

Learning Outcomes:

At the end of the lesson, you are expected to:

1. Identify the phases in the decision-making process, and

use a decision-support framework to demonstrate how
technology supports managerial decision making;
2. Describe and understand the manager’s role;
3. Increase decision making skills;
4. Describe and provide examples of the different ways in
which organizations use business intelligence;
5. Specify the BI applications available to users for data
analysis, and provide examples of how each might be
used to solve a business problem at your university;
6. Describe three BI applications that present the results of
data analyses to users, and offer examples of how
businesses and government agencies can use each of
these technologies.

Managers and Decision Making

Management is process by which organizational goals are

achieved through the use of resources (people, money, energy,
materials, space, time).

Productivity
A measurement of resources used as compared to the goals met.

The Manager’s Job and Decision Making

• Interpersonal roles: figurehead, leader, liaison

• Informational roles: monitor, disseminator,
spokesperson

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• Decisional roles: entrepreneur, disturbance handler,

resource allocator, negotiator

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A decision refers to a choice among two or more alternatives

that individuals and groups make. Decisions are diverse and are
made continuously. Decision making is a systematic process. It
starts with the intelligence phase, in which managers examine a
situation and identify and define the problem or opportunity. In
the design phase, decision makers construct a model for the
situation making assumptions that simplify the expressing the
relationships among all the relevant variables. Finally, the
choice phase involves selecting a solution or course of action
that seems best suited to resolve the problem. This solution is
then implemented. Implementation is successful if the proposed
solution solves the problem or seizes the opportunity. If the
solution fails, then the process returns to the previous phases.
Computer-based decision support assists managers in the
decision-making process.

Fig. 1: The Decision making phases and process

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Why Managers need IT support?

1 The number of alternatives to be considered constantly

increasing. Due to innovations in technology, improved
communication, the development of global markets, and the
use o the Internet and e-business.
2 Decisions must be made under time pressure. It is often
not possible to manually process information fast to be
effective.
3 Decisions are more complex. It is usually necessary
conduct a sophisticated analysis in order to make a good
decision.
4 Decision makers can be in different locations and so is
the information. Bringing everything together quickly can
be a major challenge.

What is Business Intelligence?

The applications and technologies for consolidating, analyzing,

and providing access to vast amounts of data to help users make
better business and strategic decisions.

Business Intelligence Applications for Data Analysis

A good strategy to study the ways in which organizations use

business intelligence applications is to consider how the users
analyze data, how they present the results of their analyses, and
how managers and executives(who can be users implement the
results).

A variety of BI applications for analyzing are available these

includes:

1. Multidimensional data analysis (or online

analytical processing - OLAP) – “involves
slicing and dicing” data stores in dimensional
format, drilling down in the data to greater detail
and aggregating the data.
• Provides users with a look at what is
happening or what has happened.

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Business Intelligence

• Allows users to analyze data in such a

way that they can quickly answer
business questions.

2. Data mining – refers to the process of searching

valuable business information in a large
database, data warehouse or data mart.

Common Data Mining Examples:

• Predicting trends and behaviors

• Identifying previously unknown patterns and
relationships
• Specific Industry Examples:
o Retail: Predicting Sales, Inventory Levels
o Banking: Determining credit approvals
o Police work: Tracking crime patterns, collecting
criminal evidence
o Healthcare: Diagnostics & symptom analysis

3. Decision support systems- Computer-based

information systems that combine models and
data in an attempt to solve problems with
extensive user involvement.

3 Common types of DSS.

• Sensitivity analysis: the study of the impact

that changes in one (or more) parts of a model
have on other parts.
• What-if analysis: the study of the impact of a
change in the assumptions (input data) on the
proposed solution.
o Example: Excel Scenario Manager
• Goal-seeking analysis: the study that attempts to
find the value of the inputs necessary to achieve a
desired level of output.
o Example: Excel Solver

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Business Intelligence Applications for Presenting Results

The results of the data types of the data analyses can be

presented with dashboards and data visualization technologies.

a. Digital dashboards- evolved from executive information

systems, which were information systems designed specifically
for the information needs of top executives.
b. Data visualization – after data have been processed, they
can be presented to users in visual formats such as text, graphics
and tables. This process is known as data visualization.

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Business Intelligence

Assignment:

Provide at least 3 industries using Business Intelligence software and how it benefits them.

Glossary
Business Intelligence is the applications and technologies for
consolidating, analyzing, and providing access to vast amounts
of data to help users make better business and strategic
decisions

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Business Intelligence

Decision refers to a choice among two or more alternatives that

individuals and groups make.

Management is process by which organizational goals are

achieved through the use of resources (people, money, energy,
materials, space, time).

Productivity
A measurement of resources used as compared to the goals met.

References
Rainer & Prince. Introduction to Information Systems, 5th
Edition. Wiley 2015

Joseph Valacich and Christoph Schneider. Information Systems

Today, 5th edition. Prentice Hall, 2010..

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http://csbapp.uncw.edu/mis213/12/12-3.html

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