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What is Business Intelligence (BI), how does it work, and benefit growing organizations?

What is Business Intelligence (BI), how does it work, and benefit growing organizations?

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Question asked by sabita_dahal

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angel profile image
Angel Paudel

Business Intelligence (BI) is used to college, manage and interpret information using an intelligence system which is computerized. This intelligence helps a business make an informed decision with regard to the business plan, expansion or basically anything (Spruit & de Boer, 2014). It helps make intelligent monitoring of the business operation. BI uses a combination of tools like decision support system, database management system, statistical analysis, and data mining. BI is basically used to analyze raw data of a business. It makes use of key performance indicators (KPIs), automated monitoring, and dashboard to obtain essential data.

BI is a lot different from the other general decision support system as BI focuses on the entire operation of the company and not a specific type of decision, making it more comprehensive. The execution period is rapid and can be considered to be close to real-time in the continuous basis, making it possible to get integrated, ongoing view of the business with BI. It can be said that BI has a mind of its own i.e. it’s intelligent. That makes it possible to not only integrate the internal information to the organization but also checks the information related to specific competitors or market conditions (Yogev, Even & Fink, 2013).

Considering an example to look at how BI works in a company. Let’s consider a restaurant business which specializes in server burger. For the example, it’s named as Big Burger. The business started its service in Kathmandu several years ago and have introduced a few new products to its offering some months back. The business wants to attract new customers to the outlet to try these new menu items. Few months down the line, they want to determine, which item was a big hit while which failed. For this, they can look at the data presented by the BI software which they have installed and allows to determine exactly that. After reviewing the data, Big Burger realized that its egg burger was a big failure. With that decision, they can now focus on other products which brought success to the business and drop out egg burger from their menu.

BI powers companies to gain a competitive edge. Companies can make use of the business intelligence software’s information to identify which items are doing well and which aren’t by looking at the demand, profitability of the products. It also helps improve the performance among the sales team with modified practices relating to individual and teamwork. The system also provides a business to do predictive analysis. With this, a business can forecast how a business will look in the next few days, weeks, months or even years. They can also make predictions about the competitors and what will provide them with a competitive edge in the future by analyzing the trends (Wynn & Brinkmann, 2016). All these couldn’t be done through a round of brainstorming or other forms of thinking. And, this is where business intelligence provides a significant advantage to the company to capitalize upon.


Spruit, M., & de Boer, T. (2014). Business Intelligence as a Service. International Journal Of Business Intelligence Research , 5 (4), 26-43.

Wynn, M., & Brinkmann, D. (2016). Exploiting Business Intelligence for Strategic Knowledge Management. International Journal Of Business Intelligence Research , 7 (1), 11-24.

Yogev, N., Even, A., & Fink, L. (2013). How Business Intelligence Creates Value. International Journal Of Business Intelligence Research , 4 (3), 16-31.

ncitujjwal profile image

The Business Intelligent is the "computer-based techniques used in spotting, digging-out, and analyzing ‘hard’ business data, such as sales revenue by products or departments or associated costs and incomes. Business intelligence technologies provide views about the past, current and future business operations. BI helps us for reporting, online analytical processing, analytics, data mining, benchmarking, text mining etc. The major role of business intelligent is to support better business decision - making. BI system is technology based system and it uses technologies, processes, and applications to analyze mostly internal and structured data (RANJAN, 2009). Microsoft Excel, Oracle OBIEE, SAP business objects 4.0 is a widely used business intelligence tool. Now Google doc is also widely used BI tools.

The main objective of BI in business are:

  • First understand the internal and external strengths and weakness of firms.

  • Identify the opportunity of innovation.

  • Clearly understand the relationship between different data for better decision making.

  • Optimal uses of resources and reduce the operating cost.

It provide a unique approach and capabilities for building analytical applications. The widely used tools of BI are Oracle OBIEE, SAP Business Objects 4.0. We have many choices and platform of BI platforms capabilities and use cases as well as many emerging BI technologies such as in memory analytics, interactive visualization 178 IT Application in Retail and BI integrated search (Stackowiak & Rayman, 2014).The idea of standardizing on one supplier for all of one’s BI capabilities is difficult to do. Increasingly, standardization is more about managing a portfolio of tools used for a set of capabilities and use cases.

Here I am going to discuss more about retail business intelligent. Retail business industry covered almost (6 to 7 %) world business economy and covers a large eco system -E-commerce, Apparel, Department Stores, Discount Drugstores, Discount Retailers, Electronics, Home Improvement, Specialty Grocery, Specialty Retailers and Consumer Product Goods Suppliers. Technology gives shoppers scientific pricing, effective promotion and detail product information in real - time. Application of iPhone, and Android and other smart phones, like Red Laser can scan barcodes and provide immediate price, product and cross - retailer comparisons. In Nepal, Bhatbhatani and Big mart are big superstore of retail business. They are using barcode system for scanning the product and they get information of price, product type and its stock limit. So this is a one of suitable example of BI in Nepal. Similarly in America, Wall mart has smart BI system, they used technology for customer service and getting information in real time. In America, at the time of hurricane the most selling items is water. So by using smart technology system they are able to maintain their stock, similarly Beer and Diper is another suitable example of Business Intelligent system.
Two major principle Product affinity technique and market basket analysis is applies in Retain BI for point of scale data. This analysis provides the clear insights of detail, types and price of product customer usually buy. In America, Diper and Beer is the unique product and suitable example of market basket analysis. It also provides the information about the time of year when the sales for a combination of products increase, destination items that attract customers to the store, and reasons for a sudden boost in the sales of a specific product. The analytical abilities of retail BI can identify correlations between customer profiles and product purchases and store visits.

These two technique or approach provides clear information of wall mart and grocery business. The market basket analysis first profile and classified into different categories such as grocery basket, special occasion, basket, weekly shopping basket based on the objective of the shopping trip as revealed by the analysis. The information can be used for planning and marketing and we can also make a decision based open these data. Similarly, product affinity gives the more data of product data and these data can lead the store manager to identify the products that most shoppers look for in the grocery shop and supper store. This will lead the store manager to place these products in an easily accessible area or identify the products that are bought together most often and display them in close vicinity or arrange the products identified as impulse purchases in an attractive manner to make the impulse irresistible (Cui & Damiani, 2017).

The major function of business intelligent system are:

  • To improve the effectiveness of marketing and promotion.

  • To design a planning strategic initiatives such as periodic promotions, campaigns, special offers, price changes, cross - selling, product - pairing.

  • To correct store performance with overall market performance.

  • To plan the store layout for more effective product placement and shelf presentation with appropriate prominence for impulse purchases, seasonal purchases, destination/anchor products.

Cui, Z., & Damiani, E. (2017). 'Benefits of Ontologies in Real Time Data Access. Digital Ecosystems and Technologies Conference, DEST '07 , 392-397.

RANJAN, J. (2009). BUSINESS INTELLIGENCE: CONCEPTS, COMPONENTS, TECHNIQUES AND BENEFITS. Journal of Theoretical and Applied Information Technology , 60-65.

Stackowiak, R., & Rayman, J. (2014). Oracle Data Warehousing and Business Intelligence Solutions. Wiley Publishing, Inc.

sachitabhattarai profile image

Business Intelligence refers to the use of advanced technology and various applications in order to store, collect, analyze and provide access to information for improving business process. It collects the data that supports the management in the decision-making process. As Amoako (2013) points out, "Business Intelligence (BI) possesses the capabilities that support superior business decision making through past, present and predictive composition/trends of organizations’ operations.” For example, through Data warehouse, companies assemble data coming from various sources such as CRM, ERP, text files, spreadsheet, etc. in it that helps in creating well-organized business meters.

Along with this, business intelligence supports in decisions regarding how much to spend for online ads for an advertising company, for a restaurant it can help to decide their prices of the dishes, when and how can a company work to help the earthquake/ natural disaster victims through CSR, and many more. It helps the operational level employees by providing various ways to deal with the customers, handle daily transactions, and also helps the organization to bring the best performance from their employees. Tactical levels employees can use it to take decisions related to the marketing plans, budgets of the different division, product enlargement, etc. Likewise, for a strategic level, it can assist them in takings decisions regarding Research and development investment retrieve the historical data, take the help of big data to know about their rivalries, their economic trends, and details of their clients.

BI collects information through a data capture process, with this anyone from anywhere with the system can acquire information from another system and store those data in a database modelled according to the type of business. This collected historical and current data is used for the business leaders to make more informed decisions. Then they transform it into useful data that works as a basis for strategic decision-making by eliminating the guesswork and gut-feeling. And finally, the data is ready to transfer to all the departments. As an instance, call centers use Interaction analytics to monitor calls that help the leaders to identify the audio patterns and behaviour of the employee towards their customer. This helps in identifying who are the top performers, how they deal with their customers and also identifies those calls speech patterns that failed. It also plays a huge role in identifying the website traffic through Google Analytics. Google Analytics helps the website owner to get the insight report on the number of people visited their website, the place they are visiting from, number of times of visit, time spent on their page, likes, the type of page visited, referral page, visitor’s web domain, and the type of other type of traffic. In this way, "Business intelligence applications have made an impact on organizations around the world, enabling companies to have more insight into their business than ever before” (C.S. Ramanigopal, 2012).

For a growing company, business intelligence helps to know where their products are, where they can cut off the cost, how well they are performing in the market, what are their future scope and what changes can be brought to retain the customers through research and development. BI can act as a support system to provide them facts for the business information and business analysis. For a company who is more on transactions, BI can help them to provide quick information about the current business transactions and status as well as the transactions that occurred years or months ago. It offers an easy process of business registering, data access and various equipment for registering that every employee in the organization can use easily, make faster decisions and even improve their performance. BI encourages teamwork by letting employee share data in a secured way maintaining the privacy of their clients and control web atmosphere with the group members, and other associates by saving their time. BI also contribute in providing data supervision for implementing the preplanned actions smoothly In this way, entrepreneurs can use business intelligence to gain insights into real-time business performance.

Amoako, B. T. (2013). The Importance of Business Intelligence As a Decision-making Tool. Case Study Electricity Company of Ghana.

C.S. Ramanigopal, G. P. (2012). Business Intelligence for Competence in Consumer Packaged Good Industry. International Journal of Marketing and Technology, Volume 2, Issue 5, 84-105.

dipadhungana profile image

Business Intelligence
Business Intelligence (BI) is a broad category of application programs and technologies for gathering, storing, analyzing and providing access to data to help enterprise users make better decisions (Wallace, 2015). It is an umbrella term that combines architecture, tools, databases, analytical tools, applications and methodologies to combine different data sources into information about processes in the company and provide this information to the managers at different level in appropriate manner at the right time to support them in operational, tactical and strategic decision making (Harakova & Skalska, 2013).

BI is associated with querying, reporting, online analytical processing and alerts in order to gain business advantage by answering the fundamental questions like how the customers are ranked, how the business is doing, which product is contributing more in the profitability of the company, which product is yielding negative return for the company etc. It provides back up for these answers in the form of processed information. Thus BI helps in creating a fact based decision making framework through strong computer system (Bogdan, 2013).

Working Procedure of Business Intelligence

A company has a lot of information that are dispersed in different systems. It is difficult to analyze the performance of the organization based on the scattered data. It makes the decision process lengthy and less effective. So the BI takes input in the form structured/unstructured data from internal as well as external sources. The input for the system is provided through company spreadsheet, transactional databases, web pages, social networks, business processes, data warehouse among others (Nigash, 2004). Once the data from different sources are identified, BI processes those data and brings it to a single unified view providing real time reporting, dashboards and predictive analysis. These reports helps the organization in fast decision making and effective strategic management (Know Solutions).

For example: If a clothing store located in in different parts of Nepal plans to develop a sales promotion campaign, it needs information about past promotional activities, preferences of customers residing in different locations, budget required to support the campaign, inventory necessary to execute the campaign successfully. BI, in such situation helps to develop effective sales promotion activity by providing important pieces of information and correlation among those information. Thus the major task of BI is to convert raw data into meaningful information to support decision making.

Benefits of Business Intelligence

The benefits of BI in organizations can be highlighted through following points:

Improve Management Process: BI provides real time updated data about production, sales and customer needs and preferences in organized, structured and readable format. This prevents from taking decision based on presumptions, guess works and guts. Thus it enables faster decision making, real time performance management, improved reporting speed and greater insights into customer behavior. All these collectively helps in improving the management process as the availability of consolidated and fact based information makes planning and controlling more effective (IDC Technologies).

Improve Operational Process: The organizations constantly need to look for ways to improve revenue and decrease costs. BI provides information about business activities generating higher revenue, the products or services that are not performing as expected and are not contributing in the revenue of the organization, cost consuming activities with no or less revenue, time taken for processing the order, possible frauds or delays that may take place in service delivery process. Based on that information, we can decide on the possible changes we can make in the day to day operations to enhance the performance, reduce the cost and delays involved that will increase revenue and improve the operational process.

Predict Future: BI provides information about the business activities over years in precise manner. This helps us in analyzing the trends and patterns and predict the future. For example: If we are in garment factory and the information shows that the garment has high demand during festival seasons in the last five years, we can predict that the demand will be high in this festive season too and plan the production accordingly.

Bogdan, N. (2013). Business Intelligence Systems. Database Systems Journal, 4 (4), 12-21.

Harakova, M., & Skalska, H. (2013). Business Intelligence and Implementation in a Small Enterprise. Journal of Systems Integration, 2 (1), 50-62.

IDC Technologies. (n.d.). The Key Advantages of Business Intelligence and Analytics. Retrieved from Communication Article: idc-online.com/technical_reference...

Know Solutions. (n.d.). How Business Intelligence works? Retrieved from Business Intelligence: knowsolution.com.br/en/how-busines...

Nigash, S. (2004). Business Intelligence. Communications of the Association for Information Systems, 13 (1), 177-195.

Wallace, P. (2015). Introduction to Information Systems (Second ed.). New Jersey: Pearson Education Inc.

shantamilan profile image

Business Intelligence (BI) is all about managing data to bring out information that helps in decision making reducing risk. In this age, business is all about huge amount of data that is never ending. The reality is the struggle to make sense of it all by managing these information in a timely manner. Business intelligence just provides assistance to make the whole process easier. (Dempsey, 2004) It can even be said that "Business Intelligence has been raised in enterprise architecture as a new approach which helps managers for making accurate and intelligent decision for business in the shortest possible based on speed in data analysis. (Zamani, Maeen, & Haghparast, 2017)

Organization feed data into software which is a part of BI string. These software over time help generate reports and specific details on demand. For example accounting software that are used for business enter every day transaction of sales, purchase, payables, bad debts, depreciation etc. These data at the end of the year helps generate final reports where managers can interpret if the company is performing well as compared to previous years and what needs to be improved. This decision making power is the result of classified information the software helped generate.

There are a lot of benefits from BI. Benefit generation in a company is usually understood as reduction in cost from scale of production, simplified and effective management, maintenance and reduction in training cost. But what is missing in this picture is that better competitive use of resources comes from integrated operational information or intelligence. Intelligence that come from a single source that clarifies customers demand, supply chain and helps decision makers. (Kellett, 2006)

Saman Krish Electronic Payment Company with the use of BI has been able to deliver contactless payment for their clients. In addition they can now evaluate and analyze research variables, which will facilitate the decision making, strategic business intelligence, and operational intelligence, improve quality of business and give effectiveness in decision making. (Zamani, Maeen, & Haghparast, 2017)

Staffs in big organization are managed with the use of HRMS (Human Resource Management Software). These software are updated with details about staff, their qualification, specialization, experience, years worked, training received, salary being paid etc. which helps organization better utilize HR and take better decisions.

These are some benefits and how BI is used in business today.


Dempsey, M. (2004, June 9). Sense from nonsense The decision-making process depends on relevant, timely information, but extracting the right data from dozens of IT systems is rarely easy. Michael Dempsey finds out if business intelligence is the answer to the data conundrum: [SURVE. Financial Times , p. 6.

Kellett, A. (2006, March 16). BUTLER GROUP: The isolated, tactical use of Business Intelligence tools is outdated, inefficient and needs rapid closure; Future value of Business Intelligence to organisations will come from the extended use of enterprise intelligence services. M2 Presswire; Coventry , p. 1.

Zamani, M., Maeen, M., & Haghparast, M. (2017). IMPLEMENTATION OF BUSINESS INTELLIGENCE TO INCREASE THE EFFECTIVENESS OF DECISION MAKING PROCESS OF MANAGERS IN COMPANIES PROVIDING PAYMENT SERVICES. Journal of Internet Banking and Commerce , 1-24. Retrieved from proxy.lirn.net/MuseProxyID=mp01/Mu...

ujjwalpoudel profile image

Business intelligence (BI) is the tools and systems that are used to understand the capabilities available in the firm; the state of the art, trends, and future directions in the markets, the technologies, and the regulatory environment in which the firm competes; and the actions of competitors and the implications of these actions (Negash, 2004). It has different software to analyze an organization’s raw data which include data mining, online analytical processing, and business reporting. BI is used by most companies to track the information from business intelligence software to have an effective operation in the workplace. The business intelligence can be used to determine the required changes in software within the business and also help the employees to modify and improve their performance and teamwork among the sales team.

Business intelligence software is used as a foundation for strategic decision making was eliminating the guesswork and gut-feeling from the decision-making process. "BI offers a way for people to examine data to understand trends and derive insights” (Pratt, 2017). The data sources used to build business intelligence such as Customer Relationship Management (CRM) like Salesforce.com, supply chain information, sales performance dashboards, marketing analytics, contact center call data and metadata i.e. information describing data.

Similarly, Data from ‘source systems’ that is usually the organization’s operational applications, databases or spreadsheets are periodically extracted, processed and stored into a data warehouse .this process is known as Extract, Transform and Load( ETL). The ‘transform’ part of ETL includes ensuring that data from the various sources can be used smoothly. For example, if one individual appears on the HR system as an employee, the research system as a project member, and the education system as a post-grad research student, ETL will ensure that the individual’s three unique identifiers are linked in a meaningful way to allow a single BI report to include data from all three systems. BI then uses a variety of tools to retrieve data from the warehouse and to present it to users. A key characteristic of this, not unique to BI but certainly more prevalent in BI culture than in much traditional MI, is that reports are often interactive with their users, which may include ;proactive (for example alerting a manager if a preset trigger is reached, such as the numbers of admissions offers for a particular program reaching the target number), responsive (for example allowing users to select tailor-made and dynamic reports, rather than reports being static), contextual (for example, automatically identifying a user’s profile and adjusting the content or emphasis of a report to reflect their role in the organization or their previous usage.

The Business Intelligence application enables the company to operate and manage the information in a smart way. Business Intelligence (BI) software a collection of decision support technologies for the enterprise aimed at enabling knowledge workers such as executives, managers, and analysts to make better and faster decisions (Chaudhuri, Dayal, & Narasayya, 2011)It also helps the company to quantify the relationships with suppliers and customers. For example, Bravissimo is another underwear manufacturer who benefited from using business intelligence systems. They reportedly linked their BI tool to the MET office to predict changes in weather. “A move which sparked great results for them in the UK summer that has just passed” (THOMPSON, 2018). Other benefits include insight and optimization of business processes through indicator analysis.

Business Intelligence tools help the organization and interpretation of the data generated by the company. They are customized to meet the needs of the organization, presenting different indicators and data dashboards. For this, Know Solutions team keeps direct contact with the customers, through meetings and interviews to understand the segment that it operates. This market knowledge helps you to deploy and manage the BI tool in a way that best represents the company’s reality.


Chaudhuri, S., Dayal, U., & Narasayya, V. (2011). An Overview of Business Intelligence Technology. Association for Computing Machinery.Communications of the ACM , 54(11), 88. Retrieved from search.proquest.com/docview/884879...

Negash, S. (2004). Business intelligence. C ommunications of the association for information systems , 13(1), 15.

Pratt, M. K. (2017, September 1). What is BI? Business intelligence strategies and solutions. Software . Retrieved from cio.com/article/2439504/business-i...

THOMPSON, E. (2018). 6 Real Life Examples of Successful Business Intelligence Systems. Retrieved from BLOG: matillion.com/insights/6-real-life...