Every business involves a huge amount and variety of data. This data needs to keep safe and stored for future purposes. Business professionals require certain methods and tools to analyze and transform the data into smart actions. These methods help in making smarter decisions, identifying problematic areas, and earning profit.
Business Intelligence and Business Analytics are 2 main fields that dictate how businesses take future actions depending on the data collected from clients, users, market trends, early trend change, and several other factors. They dive deep to find the problems that lie within the business which can usually get ignored via the traditional way.
So, in this article, we’ve talked about both Business Intelligence and Business Analytics and all the ways in which they can help a business. Let’s check it out below!
Business Intelligence
The suite of processes, software, and services that transform raw data into meaningful information to get profitable actions in business is known as business intelligence (BI).
It uses past data and makes decisions on the basis of available facts to optimize overall business performance. BI analyzes the data and informs its users about the nature of business in terms of detailed intelligence. The detailed intelligence is provided in the form of maps, charts, graphs, reports, dashboards, and summaries. So the term ‘business intelligence’ comprises collection, analysis, and presentation of information to make smarter business actions.
Types of BI
There are mainly two types of BI: Operational Business Intelligence and Strategic Business Intelligence.
Operation Business Intelligence
Operational BI is linked with the transactional data source. It supports daily work processes in a business by providing information to business professionals. During organizational processes, it provides time-sensitive and relevant data to operation managers, front line and customer-facing employees. It is task-oriented and does not require graphs, charts, and maps. Some of the methods used for communication in case of operation BI are emailing, messaging, dashboard, etc.
For example, In an organization, staff needs to be informed about credit or on over dues of clients. To convey this information the graphs are not a good means. Instead, a brief message could be a better option.
Strategic Business Intelligence
Strategic BI is linked with reporting from a data warehouse. It is also called auto-delivered intelligence. It works as a basis for goal setting, planning, and direction in any business. This BI plays an important role in improving a business process. Strategic BI analyzes a predetermined set of data and provides the historical context of data. It emphasizes representing the output in a graphical manner. Itunes charts and graphs to represent the trends and problem areas.
Uses of BI
Business intelligence tools have wide uses as they provide numerous benefits to an organization’s business like keeping performance on track for better decision-making. Some of its main uses are as follows:
- BI is used to get business information efficiently and quickly.
- It provides performance indicators to a company that is aligned with its business strategies.
- BI solutions empower employees by giving them real-time and relevant data.
- A well-configured BI system saves employees time by entering data, performing calculations, and making reports quickly.
- BI software is used to identify the customers which deserve priority regarding customer satisfaction to improve the company’s reputation in the market.
- It is used to identify the areas where a company can save money such as inventory.
Business Analytics
A set of technologies and disciplines used to solve problems in business is known as business analytics. It uses various statistical models, quantitative methods, and data analysis for problem-solving.
BA (Business Analytics) determines the goals of data analysis and chooses a method of analysis. Then it collects data from various sources and finally integrates it into a single repository like a data warehouse.
Example: One of the simplest examples where you can see the use of business analytics is online shopping apps like Myntra. On purchasing a product from the app, the web page also shows you similar products or the other products which people usually buy along with the product you have already bought.
Types of BA
There are three types of business analytics: Predictive analytics, descriptive analytics, and prescriptive analytics.
1. Predictive Analytics
The analytics which analyzes the trend data is called predictive analytics. It is used for the assessment of the likelihood of future outcomes.
2. Descriptive Analytics
The analytics which tracks KPIs (Key Performance Indicators) is called descriptive analytics. It helps in the understanding of the present state of a business.
3. Prescriptive Analytics
The analytics which generates recommendations to handle similar situations in the future is called prescriptive analytics. It makes use of the past performance of the company for this purpose.
Uses of BA
Some of the main uses of business analytics are:
- BA is used to disseminate information to business professionals by means of dashboards, reports, graphs, etc.
- It collects and analyzes data from diverse sources.
- Business analytics is used to monitor KPIs and notice the changing trends in real-time.
- Commercial organizations make use of BA to revise decisions based on the data stored in the data warehouse.
- It looks for the patterns which are hidden in the large datasets.
Difference Between Business Intelligence and Business Analytics
The main differences between BI and BA are mentioned below:
- Business Intelligence accesses the big data but business analytics use different technology to handle the big data.
- Business Intelligence is used to run current business operations, unlike business analytics which is used to change business operations and improve productivity.
- BI makes use of tools such as QlikSense, PowerBI, SAP Business Objects whereas business analytics make use of Google Docs, MS Office tools, MS Visio.
- Business Intelligence gives you the content of the data about what you are having with you. On the other hand, business analytics tells how you can use that data to get insights out of that data.
- Business Intelligence sets the current trends and figures out the reasons for current outcomes by using predictive analysis and statistical analysis. On the contrary, the huge amount of data cannot be controlled by business analytics in terms of retrieving, analyzing, reporting, or publishing.
- Business Intelligence uses both past and current data whereas business analytics uses only past data to extract insights that help in meeting customer needs and increasing productivity.
- Business Intelligence comes under business analytics. On the contrary, business analytics contains business intelligence reports which are the basis for the analytics to visualize the analyzed data.