How Business Intelligence Works

Business intelligence is a technology-driven process used to analyze data, turn it into knowledge, and present detailed information. It helps executives, managers, and other business leaders make informed, fast, accurate, and successful business decisions. It uses a wide variety of tools, applications, and methods. This includes data mining, online analytical processing, inquiries, reports, as well as risk analysis. These allow you to get relevant and reliable information to the right people, at the right time, with the aim of achieving better and faster results.

But, how does business intelligence really work? It uses the big information stored in databases, cleans them, structures them, and then finally turns them into relevant and actionable information that helps you make smarter business decisions. These data sources can come from marketing analyses, sales, operations performance, a customer relationship management software system, supply chain data, etc.

So let’s look at some of the main benefits of business intelligence.

Benefits of Business Intelligence

1- Right data at the right time.

In order to make quick and accurate decisions in the business world, it is essential to have the right data when it is needed. Business intelligence centralizes and structures all the data of your company. It helps you understand your business processes, streamline decision-making, as well as improve your ability to identify key opportunities and/or threats.

2- View key information in a timely and accurate manner.

One of the key benefits of business intelligence is that it provides excellent data visualization capabilities. This allows you to create customizable, intuitive, and easy-to-interpret reports and dashboards which are adaptable to the needs of each of your business departments; those responsible for the different areas will have updated the information in real-time on the relevant data that interest them.

3- Improve your business decisions.

Implementing business intelligence will allow you to access detailed and updated information about your business, such as financial, production, customer data, etc. With all this information, you can make decisions based on evidence quickly and safely, which translates into better business decisions.

4- Increase customer and worker satisfaction.

You will be able to analyze the comments of your clients in real time. All this information helps your staff and commercial managers to identify opportunities for improvement in your business, make the necessary changes, anticipate their needs, and provide them with an excellent service that satisfies them.

Business intelligence not only helps companies get to know their customers but also helps them to better understand their employees. By having relevant information about your workers in real time, you will be more aware of their needs and be able to address their concerns quickly and efficiently.

5- Improve organizational collaboration.

Custom reports facilitate communication, allowing you to share information with the rest of the company. Each department will have the data it needs, while management will be able to access this data as well. This can improve control over the functional areas of a company.

6- Increase business productivity.

Business intelligence tools can be used in the selection and analysis process when collecting data, resulting in these activities progressing much faster than in comparison to manual or unstructured tasks. By using business intelligence, processes become more agile and effective while costs are significantly reduced, obtaining high business efficiency.

Making decisions based on the current state of the company and market trends means acting with more guarantees and less risk. By improving productivity and the time spent developing truly effective, data-driven strategies, you can focus your company’s efforts on improving sales and perfecting the business.

7- Identify new opportunities.

Identifying new opportunities and developing a strategy with supporting data can represent a competitive advantage and directly impact profitability in the medium and long term. Your employees can link external market data with internal data to spot new sales trends by analyzing customer data and market conditions, as well as spot business problems.

8- Valuable business insights: Businesses can gauge employee productivity, revenue, overall success as well as department-specific performances. It can uncover strengths and weaknesses since BI tools help organizations understand what’s working and what isn’t. Setting up alerts is easy and can help track these metrics and help busy executives stay on top of the KPIs that matter the most to their business.

9- Competitive analysis: The ability to manage and manipulate a large amount of data is a competitive edge in itself. Furthermore, budgeting, planning, and forecasting is an incredibly powerful way to stay ahead of the competition, goes way beyond standard analysis, and is also easy to perform with BI software. Businesses can also track their competitor’s sales and marketing performance and learn how to differentiate products and services.

10- Better data quality: Data is rarely squeaky clean and there are many ways that discrepancies and inaccuracies can show up – especially with a hacked-together “database”. Businesses that take care of collecting, updating, and creating quality data are typically more successful. With BI software, companies can aggregate different data sources for a fuller picture of what is happening with their business.

11- Increased customer satisfaction: BI software can help companies understand customer behaviors and patterns. Most companies are taking customer feedback in real time and this information can help businesses retain customers and reach new ones. These tools may also help companies identify buying patterns, which help customer experience employees anticipate needs and deliver better service.

12- Identifying market trends: Identifying new opportunities and building out a strategy with supportive data can give businesses a competitive edge, directly impact long-term profitability, and gives the full scope of what is happening. Employees can leverage external market data with internal data to detect new sales trends by analyzing customer data and market conditions, as well as spotting business problems.

13- Increased operational efficiency: BI tools unify multiple data sources, which help with a business’s overall organization so that managers and employees spend less time tracking down information and can focus on producing accurate and timely reports. Armed with up-to-date and accurate information, employees can focus on their short and long-term goals and analyze the impact of their decisions.

14- Improved, accurate decisions: Competitors move quickly and it’s important for companies to make decisions as quickly as possible. Failure to issue with accuracy and speed could lead to lost customers and revenue. Organizations can leverage existing data to deliver information to the right stakeholders at the right time, optimizing time-to-decision.

15- Increased revenue: Increasing revenue is an important goal for any business. Data from BI tools can help businesses ask better questions about why things happened by making comparisons across different dimensions and identifying sales weaknesses. When organizations are listening to their customers, watching their competitors, and improving their operations, revenue is more likely to increase.

16- Lower margins: Profit margins are another concern for most businesses. Fortunately, BI tools can analyze inefficiencies and help expand margins. Aggregated sales data help companies to understand their customers and empower sales teams to develop better strategies about where budgets should be spent.

Remember that business intelligence consists of tools, technologies, applications, and practices that are used to collect, integrate, and analyze the present and past data of an organization.