What is Business Intelligence (BI)?

BI is neither a product nor a system. It is an umbrella term that combines architectures, applications, and databases. It enables the real-time, interactive access, analysis, and manipulation of information, which provides the business community with easy access to business data.

Businesses generate a sea of data. Every datum carries a small piece of the business’ story. This data is scattered everywhere, in disparate systems like enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM) etc. It is held captive in dead hard drives, and can even be situated in geographically different regions. However, it is in data, where the true nature of business—its trends, strengths, and weaknesses—lie. BI gathers all the related data to turn it into information and information that is analyzed properly can be used for decision making which can finally go into action. In other words, BI transforms data into information, information into decisions, and decisions into action.

Thereby, BI doesn’t produce any data, but it uses data produced by other business applications like enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM) etc. All of these are a part of BI. They are all dependent on BI tools, but it should be noted that BI is not dependent on them.

BI analyzes historical data—the data businesses generate through transactions or by other kinds of business activities—and helps businesses by analyzing the past and present business situations and performances. By giving this valuable insight, BI helps decision makers make more informed decisions and supplies end users with critical business information on their customers or partners, including information on behaviors and trends.