Tuesday, November 6, 2012

Business Intelligence Solutions Making a Difference

Neil Raden, CEO and Principal Analyst of Hired Brains Inc. advocates in his article that the applications and tools of the past, including primitive spreadsheets are not as effective when it comes to providing businesses with a strategic advantage. Gartner glossary, an IT database search engine for defining IT terms, defines Business intelligence (BI) as an umbrella term that includes the applications, infrastructure and tool that enable access to information and analysis of it. Raden comments on Business Intelligence by stating, “To be effective, business people need more than access to data”. Today business people are clamoring for more information about their customers and about their business in general.  Business peoples’ ability to get closer to data is spurring innovation by software companies around the world.
BI is a critical way for businesses to provide companies with a strategic weapon for mining their data. BI can also be defined as the ability of a company to collect, maintain, and organize knowledge. This type of intelligence usually produces large amounts of information that can help develop new opportunities and effective strategies that provide a competitive advantage for long-term stability in the future. Raden states the importance of mining data in an effective and coherent way.  Raden works for the company, Hired Brains Inc., which is a research analysis, advisory, consulting service firm serving North America, Europe and Asia. Through Raden’s research and analysis background he is able to carefully analyze the essence of BI and how it is used effectively and ineffectively in businesses today. 
For the past two decades, spending has been focused primarily on the hardware and services to store data rather than the software to help sift through the data. In order for businesses to be run effectively, is not just by having access to more data. Instead a good tactic would be to require a seamless process that allows an interaction with such data. This in depth data analysis will better their own models and processes. Raden states that “In today’s environment, these steps are typically disconnected.” What he means is that the idea of strategically mining the data is lacking because it is expensive and slow to maintain without the data quality controls from specific IT departments. Next generation business intelligence tools need to be simple enough to use. This way, even business people can use them and not require hours of coding or major IT support.
I feel that BI is an intriguing topic right now and the companies that figure it out stand to gain a huge strategic advantage over their competitors. I feel that companies who are able to look at the whole picture will be able to achieve excellence in the long-run. Wal-Mart for instance, is teaming up with Oracle to master the importance of analyzing data in this way. They analyze what items appear together on check-out lists. They analyze these consumer lists/data to find a relationship between items bought and other personal information during each cash register sale. Wal-Mart was able to use Oracle’s BI software to find a relationship between facial tissues and orange juice sales. Therefore, they were able to position those items closer together in the stores which increased sales further. Oracle is able to integrate large sums of data into one coherent place.  BI is something that once a company executes it correctly and coherently, the company can realize huge competitive gains overall. 
Attached is an a video emphasizing Oracle's way of expressing the importance of Business Intelligence and their overall motive: 



  1. These articles bring up a very important point that I have not really paid much consideration to. Many companies are willing to spend a lot of money to purchase information from the databases of Acxiom, but once they get the data, they need to know how to use it. If they aren’t utilizing the data they purchase efficiently then it is almost pointless to be purchasing the data. My group saw this occur initially during our recent Database project, where we had all the data sorted out but the most difficult part was finding the right queries to run. If companies are finding that this is happening, they need to revise the way they are using IT and the data they purchase and put it towards a more productive goal.

    In an article that I was reading through, it talked just about how companies can use BI and their data in a productive manner so that the data they purchase is being used properly. For starters, companies should just take in as much data as possible, even if they aren’t sure if they will need all of it. There are tools that enable companies to organize all of the data they collect, one of the more popular ones being known as “Hadoop”. Once they feel that enough data is collected, and then they should organize it into groups and find which groups prove to have potential to provide a competitive advantage. Hadoop is good at giving companies an idea of which data sets they will want to prioritize.

    An important note this article makes is that once companies start analyzing data, they should use BI platforms like Teradata, Oracle, and IBM. These BI platforms complement the data management systems, and help the companies find insight within the data as it grows to contain more and more. Studying historical data has been seen to be not as profitable for some companies, or for new start-up companies it is impossible. Using these BI platforms makes it much easier for these companies to use real-time information, and also provides them with the ability to analyze quickly and change the relationships they have with their customers for the better. As big data gets bigger, these BI platforms will be very desirable as more companies want to analyze their current data quickly and efficiently. I would have to agree that these BI solutions are currently making a difference in the business world for both new and old companies going into data analytics, helping them all find productive ways to use their data.

    source: http://www.virtusa.com/blog/index.php/2012/08/7-ways-to-use-big-data-to-gain-competitive-advantage-and-improve-customer-loyalty/

  2. I agree in saying that BI is extremely important to businesses especially in this day and age when customers are expecting a lot more from companies. I read that more and more businesses are waking up to the fact that perhaps the single most important aspect of business growth in today’s information world is business intelligence. Being able to collect and then visualize your most important metrics is critical. And having the right tools to automate this process is just as crucial. However, most businesses don’t start to get into business intelligence until they’ve had a massive failure or missed a big opportunity… one that could have been prevented with the proper insight. If businesses did not wait until something horrible happens with their company it could save the company a lot of time and money. At it’s core, business intelligence, is about decision-making. It’s about presenting data in a human readable way so that decisions can be made more easily and in a more informed way and so that patterns can be discovered and acted upon.

    As we have talked about a lot in class Netflix uses BI for their benefit to please customers. They are very good with displaying movies or TV shows that you would like by analyzing the movies that you have already watched. If Netflix did not do this, I would spend a lot more time searching the titles, and the company would be less desirable. Companies that are using business intelligence in the best ways are setting an extremely high bar for customers. I am a Netflix and Hulu Plus member. Hulu Plus does not offer the feature that selects shows you would like based off of previous viewings. Because of Netflix’s feature, I feel as if Hulu Plus is not reaching an expectation that I have. In my opinion as companies grow to use BI customers will be expecting much more.

    I think that the Wal-Mart example given by Kellie is extremely interesting. It shows that all companies can use BI in different ways to benefit themselves, creating a larger customer satisfaction rate leading to a larger profit in the end. As of now BI is putting certain companies at an extremely large advantage, but as Carr would say it will soon become a commodity. Businesses are not going to be able to run and stay in business eventually if they are lacking BI. I think that it is very important for ALL companies to start using BI now if they have not already. Although BI might be costly, it is well worth it. I found an interesting statistic online that said every one-dollar that businesses spend on business analytics yields to ten dollars return on investment. BI is something that all companies need if they would like to succeed.

    source: http://www.businesspundit.com/the-importance-of-business-intelligence/

  3. Business Intelligence is something that I would never have guessed would provide companies with the advantages that it is yielding today. I really like the comment Kellie made about hardware versus software. It feels like the past decade was focused mainly on who had the best hardware. Getting the best desktop with the fastest processor and most hard drive space was the concern of most people. But, as Alanna mentioned earlier, these pieces of technology are becoming commodities. Companies need to, instead, turn to software that can interpret big data because that is where they can find their competitive advantage.

    But companies do not just need the best business intelligence software to read their data; they need people who can interpret what the data tells them. Kellie used a great example about Wal-Mart. For some reason, maybe still unknown even to Wal-Mart analysts, a correlation has been found between facial tissues and orange juice. This seems like such a strange connection, but Wal-Mart has been able to capitalize on this because they interpreted that this connection might be important and moving the two products closer together might increase sales. As mentioned above, sales did, in fact, increase. But without someone using this intelligence in a productive manner, the advantage would never have occurred.

    There are so many companies today that are using business intelligence. Another example that we have discussed before is Amazon. When someone searches products on Amazon.com, the website collects information on what the person is viewing and returns products that might be of similar interest to you based on searches other people have done. This use of business intelligence is a great example of how companies can increase sales. Amazon has made a great investment in business intelligence because the way they utilize it has definitely been seen to produce a competitive advantage over competitors.

    Sometimes I get creeped out by how accurate Amazon’s recommendations are, and other times I get annoyed that they recommend products from my previous searches that really did not relate to my interests. To keep their competitive advantage with business intelligence, I would recommend that Amazon figure out how to solve this problem. Many companies are using data mining, but Amazon can do something unique by learning to separate a person’s actual interests from searches that are meaningless.

    The university of Arizona gives a great description of the benefits of business intelligence. They say some benefits include, “the ability to access data in a common format from multiple sources and a way to measure goals and analyze cross-departmental data.” Companies must start moving away from the spreadsheet and find better software for business intelligence purposes like Oracle, SAP, or other great systems that are popping up in the IT industry. The gap between companies continues to grow smaller thanks to technology, so the way a company uses business intelligence will determine how they can grow.

    Source: http://mosaic.arizona.edu/business_intelligence/advantages