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Business Intelligence
Tracy Hartley
Zack Johnson
Marissa McGee
What Is Business Intelligence?
• A set of concepts and methods to improve
business decision-making by using fact based
support systems.
• In other words, business intelligence is created from
computer software that analyzes company data and
creates useful reports that make the decision-making
process more effective and efficient.
Data
BI
Program
Wikipedia, encyclopedia
Information
Reports
History…
• Sun Tzu’s “The Art of War”
• One should have full knowledge of one’s own strengths and
weaknesses as well as full knowledge of one’s enemy’s
strengths and weaknesses.
• Before the Information Age
• Businesses struggled with the up keep of information and
storage.
• The process was slow and often ineffective.
• Modern Business
• Technology has allowed for more effective and efficient
systems.
• Up to the minute data and analysis.
Basic Components of Any BI
Program
• Data warehouse: a database that holds
business information from many sources in
the enterprise, covering all aspects of the
company’s processes, products and
customers (Stair, 219)
• Data mart: Subsets of a data warehouse that
bring data to small and medium-sized
businesses as well as the different
departments of larger businesses (Stair, 221)
Data Mining
• An automated analysis that looks for
patterns and relationships in data
warehouses.
• Computer software that requires the
user’s trust to find all of the valid
relationships needed.
• Bottom-up analysis that creates
hypothesis and predictions.
OLAP
• Online Analytical Processing
• Creates reports using the data
warehouses
• A top-down analysis that requires user
created queries to match information
and determine relationships.
• Requires a high level of user skills and
understanding of the system.
Key Differences
between Data Mining and OLAP
• Data mining takes the data and finds
relationships despite the user’s
assumptions.
• OLAP finds relationships in the data
according to the user’s assumption.
The Five Stages of BI
• Data Sourcing
• Data Analysis
• Situation Awareness
• Risk Analysis
• Decision Support
Data Sourcing
• Extracts data from different areas
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Memos
Reports
E-mails
Photos
• Data is collected through
• Database queries
• Web searches
Data Analysis
• Search through the data to find that
which is relevant to the company’s
needs.
• Also known as data mining
• Can be in the form of current or future
trends.
Situational Awareness
• Any irrelevant information is discarded
and the relevant information is set in the
context of the business and its
environment.
• Applying the information to the problem.
Risk Assessment
• Decisions are made in terms of what
actions should be taken and when.
• Analyze the current and future risks
associated with our decisions.
• Weigh the costs and benefits of making
the decisions.
Decision Support
• Apply the information you need in an
appropriate time frame and manner.
The Many Types of BI
DATA
• Data mining
• Data warehouse
• DSS
• EIS
• GIS
• MIS
• OLAP
• Text mining
KNOWLEDGE
• Experience
Designing/Implementing
• Questions to ask
• Risk assessment
• Who uses BI?
• Companies/software
Assessments to be Made by the Company
Before Implementing a BI Program
• Assess short- and long-term goals.
• Set tangible goals with deadlines and
expectations
• Assess the current method of collecting
business intelligence
• Determine strengths and weaknesses
• Is current method effective for achieving
goals?
Assessments to be Made by the Company
Before Implementing a BI Program
• Determine the financial consequences
associated with a new BI program
• Work with companies, such as IBM, to adequately
determine the needs of the company.
• Costs include more than just the software…
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Set-up
Employee training
Updating the system
Personnel
Maintenance
Assessments to be Made by the Company
Before Implementing a BI Program
• Identify who is going to pay for the
program.
• Determine any risks outside of cost that
might arise from a new BI program
• Address possible benefits.
• Both quantitative and qualitative internal
and external to the company.
• Weigh the costs and benefits
Assessments to be Made by the Company
Before Implementing a BI Program
• Set up a system of metrics and
measurements to analyze results.
• Benchmark against other companies.
• Evaluate system on a regular basis to
allow for any corrections that need to be
made.
Companies That Provide BI
Programs
• IBM
• Offers both software and hardware
• Provides components of BI programs and
entire systems
• Banking, Criminal, Retail and Insurance are
some of the industries IBM offers support to
• SAP
• Oracle
Applications
• Sales
• Pricing
• Profit margins
• Which products are being purchased
• Consumer behavior
• Which customers are buying what, when.
• What factors effect purchasing behavior
• Competitive Intelligence
• What our competitors doing that we could/should be doing?
• Do we have a competitive advantage?
• Counter Intelligence
Boscov’s Department Store
• Boscov’s Department Store
• 40 stores in Pensylvania, New York, New
Jersey, Deleware, Maryland and Virginia
• Family owned company.
• Upper level management includes 206
employees
Doscov’s Department Store
• Problem: Only able to provide weekly sales
reports.
• Insufficient for employees to keep the shelves
adequately stocked with the right products
• Unable to meet some customers’ immediate
needs.
• Goal: Wanted to keep their company growing
and provided more up-to-date reports.
Boscov’s Department Store
• Solution: IBM DB2 Universal Database
for z/O
• Provides buyers with mission-critical
business intelligence on sales performance
• Optimize performance of the data
warehouse and the queries that buyers
depend on to make important business
decisions.
Boscov’s Department Store
• Results: Able to provide current and
accurate daily sales information
• Making better sales decisions and provide
better products and services for its
customers.
Safeway Club Card
• Means for company to track sales per
customer.
• Allows Safeway to target profitable and
discourage nonprofitable customers
• Can track purchasing trends
• Better idea of what products sell the best in
different locations
• Charge different prices for clients for
different floor location
General Problems/Shortfalls
• Supply chain value
• Can not predict everything
• Weather
• Human error
• Any other examples you can think of?
• Important to determine if it is faster to
get information from BI and make
adjustments according to things you
cannot predict!!