Cracking the Code: Business Intelligence and Actionable Insights

MX Bites / September 16, 2023

Business intelligence (BI) refers to a set of procedures, technologies, and tools that help companies collect, analyze, and transform data into actionable insights for better decision-making. The basic purpose of business intelligence (BI) is to transform raw data into valuable information that provides a clear view of a company’s performance, trends, and prospects over time. This powers effective and strategic thinking in business decision-making, and it is the basis on which a business’s value is predicated.

BI does not exactly tell business owners what to do; instead, it presents insights and trends through chats and diagrams in a way that makes it easy for business insights to be abstracted. The process and forms through which BI presents insights from data are termed data visualization. Insights gleaned from data visualizations are then captured in data storytelling, which helps to interpret and present them in more relatable terms. 

The end goal of business intelligence is to inspire accuracy in decision-making and to fully harness its impact in an organization, the culture of data literacy must be fully imbibed to encourage stakeholders to follow along in decision-making.

Wielding the power of business intelligence in decision-making requires a thorough understanding of the process, which the rest of this article aims to fully justify.

How Business Intelligence Works

Business intelligence solely relies on a backlog of historical data stored in a data warehouse. Working unanimously with the data warehouse, business intelligence software relies on this data store to respond to user queries and present them in the form of visuals, charts, and diagrams, from which intelligent insights are generated. 

Technically, BI starts with the collection of data from different valuable sources, which include data warehouses (as stated above), databases, external market data, social media,  customer reviews, and so on. These data could either be structured or unstructured. 

Before storing the data in a company’s data warehouse, the BI tools check it for accuracy and consistency. Then the data is analyzed to uncover patterns, trends, and insights, which are presented in the form of reports and visuals. Business decision-makers can successfully get insights from these visuals by carefully interpreting the charts, graphs, dashboards, and reports or by using the art of data storytelling.

Additionally, a BI system can provide predictive analytics, data exploration, data reporting, and other services that support a company’s ongoing operations.

The Importance of Business Intelligence

BI sets the tone for any fundamental decision-making process, which powers everything else that has to do with business growth. Aside from enhancing informed business decision-making, BI offers a plethora of benefits to any organization. They include, but are not limited to, the following:

1. 1. Risk management: For business continuity, risk identification and mitigation are essential. By monitoring important aspects like financial data, supply chains, and compliance issues, BI can help firms identify and reduce risks. 
   2. Fostering data-driven culture: In a working structure where everyone is able to access and understand data, progress is a surety. BI ensures that every stakeholder involved in a company is able to make sense of the amount of data that floods in at any given time. Therefore, no one is stranded or ignorant about how to go about making decisions.
   3. Competitive Advantage: Following generic ways of making decisions will only produce ordinary results. In this increasingly competitive business landscape, it takes extra effort with the help of an advanced tool to rise above the competition. Hence, BI tools offer a competitive edge for businesses with undying desire for outstanding success.
   4. Improved Customer Experience: By analyzing and drawing insights from customer reviews and comments, BI enables companies to understand customer behaviors and uncover insights into their expectations and how best to meet them. When a company uncovers the secret to understanding customer preferences, it is likely to succeed.
   5. Improved Operational Efficiency: BI identifies loopholes and inefficiencies in operational structures and provides strategies on how to improve them. This improvement can lead to cost savings, better resource allocation, and enhanced productivity.

In conclusion, BI should no longer be considered a luxury but rather a requirement for any business that aspires to reach its full potential. Companies can learn to manage risk, improve operational efficiency, increase revenue, and grow in all areas by incorporating BI into decision-making.