Business Intelligence? Definition & Example

What is Business Intelligence?

BI(Business Intelligence) is a lot of processes, architectures, and innovations that convert raw data into significant information that drives profitable business actions.It is a suite of software and services to transform data into noteworthy intelligence and information.

BI directly affects organization’s strategic, strategic and operational business choices. BI supports truth based dynamic utilizing historical data rather than presumptions and premonition.

BI tools perform data examination and create reports, summaries, dashboards, guides, graphs, and charts to provide users with itemized intelligence about the nature of the business.

Why is BI important?

  • Measurement: creating KPI (Key Performance Indicators) based on historic data
  • Identify and set benchmarks for varied processes.
  • With BI systems organizations can identify market trends and spot business problems that need to be addressed.
  • BI helps on data visualization that enhances the data quality and thereby the quality of decision making.
  • BI systems can be used not just by enterprises but SME (Small and Medium Enterprises)

How Business Intelligence systems are implemented?

Here are the steps:

Step 1) Raw Data from corporate databases is extracted. The data could be spread across multiple systems heterogeneous systems.

Step 2) The data is cleaned and transformed into the data warehouse. The table can be linked, and data cubes are formed.

Step 3) Using BI system the user can ask quires, request ad-hoc reports or conduct any other analysis.

Examples of Business Intelligence System used in Practice


In an Online Transaction Processing (OLTP) system information that could be fed into product database could be

  • add a product line
  • change a product price

Correspondingly, in a Business Intelligence system query that would beexecuted for the product subject area could be did the addition of new product line or change in product price increase revenues

In an advertising database of OLTP system query that could be executed

  • Changed in advertisement options
  • Increase radio budget

Correspondigly, in BI system query that could be executed would be how many new clients added due to change in radio budget

In OLTP system dealing with customer demographic data bases data that could be fed would be

  • increase customer credit limit
  • change in customer salary level

Correspondingly in the OLAP system query that could be executed would be can customer profile changes support support higher product price

Example 2:

A lodging owner uses BI scientific applications to gather measurable information regarding average inhabitance and room rate. It assists with discovering aggregate revenue generated per room.

It additionally gathers insights on market share and data from customer surveys from every lodging to chooses its competitive position in various markets.

By dissecting these trends step by step, step by step and step by step causes management to offer limits on room rentals.

Model 3:

A bank gives branch managers admittance to BI applications. It causes branch manager to determine who are the most profitable customers and which customers they should work on.

The utilization of BI tools frees information innovation staff from the assignment of generating investigative reports for the departments. It likewise gives department personnel admittance to a richer data source.

Four kinds of BI users

Following given are the four central members who are utilized Business Intelligence System:

1. The Professional Data Analyst:

The data analyst is an analyst who in every case needs to drill where it counts into data. BI framework encourages them to get fresh experiences to create one of a kind business strategies.

2. The IT users:

The IT user likewise assumes a predominant role in keeping up the BI infrastructure.

3. The top of the organization:

President or CXO can increase the profit of their business by improving operational proficiency in their business.

4. The Business Users”

Business intelligence users can be found from across the organization. There are predominantly two kinds of business users

Easygoing business intelligence user

The power user.

The difference between them two is that a power user has the capability of working with complex data sets, while the easygoing user need will make him use dashboards to assess predefined sets of data.

Points of interest of Business Intelligence

Here are a portion of the upsides of utilizing Business Intelligence System:

1. Lift productivity

With a BI program, It is workable for businesses to create reports with a solitary snap subsequently spares heaps of time and resources. It likewise permits representatives to be more productive on their assignments.

2. To improve visibility

BI additionally assists with improving the visibility of these processes and make it conceivable to recognize any areas which need consideration.

3. Fix Accountability

BI framework relegates accountability in the organization as there must be somebody who should possess accountability and ownership for the organization’s performance against its set objectives.

4. It gives a bird’s eye see:

BI framework additionally helps organizations as leaders get an overall bird’s eye see through average BI features like dashboards and scorecards.

5. It streamlines business processes:

BI takes out all complexity related with business processes. It additionally robotizes analytics by offering predictive examination, computer demonstrating, benchmarking and other systems.

6. It allows for easy analytics.

BI software has democratized its usage, allowing even nontechnical or non-analysts users to collect and process data quickly. This also allows putting the power of analytics from the hand’s many people.

BI System Disadvantages

1. Cost:

Business intelligence can prove costly for small as well as for medium-sized enterprises. The use of such type of system may be expensive for routine business transactions.

2. Complexity:

Another drawback of BI is its complexity in implementation of datawarehouse. It can be so complex that it can make business techniques rigid to deal with.

3. Limited use

Like all improved technologies, BI was first established keeping in consideration the buying competence of rich firms. Therefore, BI system is yet not affordable for many small and medium size companies.

4. Time Consuming Implementation

It takes almost one and half year for data warehousing system to be completely implemented. Therefore, it is a time-consuming process.

Trends in Business Intelligence

The following are some business intelligence and analytics trends that you should be aware of.

Artificial Intelligence: Gartner’ report indicates that AI and machine learning now take on complex tasks done by human intelligence. This capability is being leveraged to come up with real-time data analysis and dashboard reporting.

Collaborative BI: BI software combined with collaboration tools, including social media, and other latest technologies enhance the working and sharing by teams for collaborative decision making.

Embedded BI: Embedded BI allows the integration of BI software or some of its features into another business application for enhancing and extending it’s reporting functionality.

Cloud Analytics: BI applications will be soon offered in the cloud, and more businesses will be shifting to this technology. As per their predictions within a couple of years, the spending on cloud-based analytics will grow 4.5 times faster.


BI is a lot of processes, architectures, and advancements that convert raw data into important information that drives profitable business activities.

BI frameworks help businesses to distinguish market trends and spot business problems that should be addressed.

BI innovation can be utilized by Data analyst, IT individuals, business users and top of the organization.

BI framework causes organization to improve visibility, productivity and fix accountability

The draw-backs of BI is that it is tedious expensive and very intricate process.