21 April 2009

What exactly is meant by 'Business Intelligence'

Ask 5 people what BI (Business Intelligence) means and you will probably get at least 6 different answers.

Today's post is short (and hopefully sweet) and describes the various forms that BI takes on.

In short, BI is either:
  • Strategic
  • Tactical
  • Operational

There is a new emerging category, which bridges all 3 types: Predictive

Strategic BI
This is where the Inmon-style massive data warehouse is involved and tries to answer the strategic business questions of trends over longer periods of time, where the business is headed and what the business should focus on in terms of overall business, where the money is coming from and going to, how the business interacts with its customers and the market at large.

This type of BI is slow as it can involve many years' worth of collected data, deliberate and the audience is generally executive management of the organisation.

Tactical BI

Smaller in size, generally restricted to a few (or often just 1) data sources and answers more immediate questions like
  • What is my best selling product per region for this quarter / month / week?
  • Who are my most efficient employees this week / day / month?
  • What is the ratio of open-closed service requests for the day / week / month / quarter
  • Who has more worked assigned than they can reasonably cope with?
  • What are my HR stats for the month/ week (OH&S, absenteeism, payroll processing, complaints, compliance, etc.)?
Many of these types of analytical views will form the content of various dashboards to be used from executives down to team leaders.

Operational BI
The target audience here is generally the regular employees, on whom the organization relies to actually get things done (as opposed to management who control, motivate, monitor & analyze), thus the amount and scope of decision making is limited.
Typical uses:
  • Daily closing figures report
  • Customer history / analysis reports
  • Employee analysis reports
  • The data will be restricted to a lower latency so that it deals closer to real-time events.
Usually, the data will be restricted to the user's area of responsibility (like team-based visibility in Siebel) or the data that the user is responsible for.

Some of these reports do not need to go against a data warehouse or data mart, thus they can be run against real-time datasources. Often these are predefined in their content and scope so you would (should) not find many power users doing analysis against real-time OLTP data sources. The datasources for these types of queries need to be protected with governors from runaway queries otherwise your normal online business operations WILL be affected. Been there as the DBA looking for the culprit (turned out to be the CFO using a point-and-click query generator against live production datasources, ouch!).

Using BI-based alerts (when a certain business event occurs, do something) falls somewhere between operational and tactical BI and starts to deliver on the promise of BI from way, way back, which is to deliver actionable, relevant, accurate information. An example of this is: When the power grid consumption nears peak, send a warning to the peak consumers of a pending blackout, via SMS text message, or email or some SOA-enabled process.

Predictive BI
The market is now ready (and pushing hard) to have the corporate information serve predictive needs. I am not going to get into the nuances of predictive models here but typical examples of this might be found on web sites such as travelocity.com (beautiful example of predictive analysis in my opinion) whereby the system is combining real-time transactional events and trying to predict consumer behaviour based on past trends and delivering the results in real-time and sub-second turnaround.

Last words
There has been some near-religious wars fought online as to what is Business Intelligence and Business Analytics, whereby reports and dashboards were categorized as BI and any sort of trending, exception alerts and prediction was categorized as Business Analytics. This in my opinion seems like a marketing effort to produce something with their time, regardless of relevance. A rose by any other name is still a rose.

Hopefully this has served to clear up in everyday language, what we BI people are on about.

Have an awesome week!


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