When IBM researcher Hans Peter Luhn coined the phrase “business intelligence” in a 1958 essay, he utilized the Webster’s Dictionary definition of intelligence: “the ability to comprehend the interrelationships of provided information in such a way as to lead action toward a desired objective.” Devens used the phrase to explain how banker Sir Henry Furnese profited by acquiring and acting on information about his surroundings before his competitors:Īccording to Devens, the capacity to gather and act on information collected is critical to business intelligence. The word “business intelligence” was first used in Richard Millar Devens’ Cyclopedia of Commercial and Business Anecdotes (1865). When external and internal data are integrated, they can offer a full picture, resulting in “intelligence” that cannot be gained from any one source of data.īusiness intelligence technologies, among other things, enable firms to acquire insight into new markets, analyze demand and fit of products and services for different market groups, and measure the impact of marketing activities.ĭata from a data warehouse (DW) or a data mart is used in BI applications, and the ideas of BI and DW are combined as “BI/DW” or “BIDW.” A data warehouse is a copy of analytical data that aids in decision making. BI is most successful in all circumstances when it combines data collected from the market in which a company works (external data) with data derived from firm sources internal to the business, such as financial and operations data (internal data). At the most general level, strategic business decisions involve priorities, goals, and directions. Product positioning and price are examples of fundamental operational choices. Businesses may gain a competitive market edge and long-term stability by identifying new possibilities and adopting an effective plan based on insights.Įnterprises may utilize business intelligence to assist a wide range of business decisions, from operational to strategic. They want to make it simple to comprehend large amounts of data. Reporting, online analytical processing, analytics, dashboard development, data mining, process mining, complex event processing, business performance management, benchmarking, text mining, predictive analytics, and prescriptive analytics are all common functions of business intelligence technologies.īI systems can manage vast volumes of organized and unstructured data to assist in the identification, development, and creation of new strategic business possibilities. Business intelligence refers to the tactics and technology used by businesses to analyze data and manage business information.
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