Download Chapter 1 Business Driven Technology

Business Intelligence
Putting together all of the pieces of the puzzle
Business intelligence (BI) refers to all of the
applications and technologies used to gather,
provide access to, and analyze data and
information to support decision-making efforts
Chapter 5: Business Intelligence
Business Intelligence vs Business Analytics
• Business Intelligence
– Querying, reporting, online analytical processing, business analytics
• Business Analytics
– A subset of BI based upon statistics, prediction and organization.
• BI answers
– What happened?
– Where the problem is
How many?
How often?
What actions are needed
• BA answers
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Why is this happening?
What will happen if these trends continue?
What will happen next?
What is the best (or worst) that can happen?
Sun Tzu in The Art of War
• To succeed in war, one should have full knowledge
of one’s own strengths and weaknesses
and
full knowledge of the enemy’s strengths and
weaknesses.
• Lack of either one might result in defeat.
Many businesses today say “how can I understand
my competitor when I can’t even understand myself.
That is what we are trying to solve using
business intelligence.
The Problem: Data Rich, Information Poor
• With all of the data being captured and generated
by SCM, CRM and ERP systems, as well as the other
digital data being created and transmitted (spreadsheets,
fields in database files, word processing documents, video clips, email and text
messages, voice mail, etc.)
explosion.
, businesses are facing a digital
• The amount of data generated is doubling every
year
– Some believe it will soon double monthly
• Data is a strategic asset for a business, and if the
asset is not used, the business is wasting resources.
Having BI promotes understanding: Asking WHY?
• Where has the business been? (historical perspective)
• Where is the business now? (modify or encourage to continue)
• Where will the business be in the future? (predict future
direction)
DATA MINING
•
The center of any business intelligence effort is data
mining.
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BI tells you what happened.
Data mining tells you why it happened.
Data mining: the use of advanced statistical
techniques to analyze large amounts of data in order
to find patterns, relationships and infer rules that
might be used to predict future behavior.
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Uses query tools, multidimensional analysis, intelligent
agents and various statistical tools
Algorithms are applied to data sets to uncover inherent
trends and patterns in the data.
Data Mining Operations
• Predict trends and behaviors
• Identify unknown patterns
• Determine how things fit together
– What goes with what?
• Identify patterns
• Attempting to understand characteristics
• The business intelligence tool used by most
organizations is Microsoft Excel and its data analysis
functionality, especially pivot tables.
• By adding a Report Filter to a Pivot Table, you can
add another dimension of information: 3-D (rows
and columns and layers).
– Creating a 3-dimensional Pivot Table in Excel is a means
of conceptually building a data warehouse. Report
Filters represent the depth layer
– Slicers also let you do this (multiple values for a given field)
• Pivot Tables can help you see relationships in the
data