We all know we’re supposed to care about reporting, metrics, analytics, trends, KPIs, dashboards, charts, graphs…data data data! Knowledge is power, sure, but it can also be overwhelming when it lacks understanding. So let’s break it down:
Business Intelligence (BI)
Business intelligence primarily uses software applications to turn the data you’ve been collecting into something you can understand (via those reports, dashboards, charts, and graphs) and turn into crucial takeaways like performance metrics, supply chain choke points, and cost breakdowns, with the goal of helping you determine your business/department strategy based on those findings. BI is omniscient in that it can tell you your present and past situation, but it’s no crystal ball.
Business analytics (BA)
Business analytics is where the crystal ball starts to come into play. Also known as advanced analytics, BA takes it another step further with complex analytical algorithms that can predict what will be (predictive analytics) or what could be based on a proposed tactic (prescriptive analytics). Like those ‘choose your own ending’ books you read as a kid, BA allows you to mentally go down multiple paths to see which leads to the best outcome. (Because who wanted to read the whole book just to find out you chose the path that led to the swamp with the quicksand and alligators?)
All this cool data analysis stuff isn’t just for the IT department anymore either, which actually has its own term: traditional/classic BI. Modern BI gives business end users (think managers and the C-suite) the tools to create their own reports and meaningful, metric-packed dashboards so they can view and analyze data on the spot.
It’s a huge work in progress, both on the software solution side and business user side. Software solution providers are racing to build or buy technology that provides users with all the BI and BA tools they could ever need while users are rushing to understand and master this ever-growing pool of options to help them get out on top. We’re all in it together though, struggling to figure out how to bring all the pertinent information together in an insightful way. As always, I’d love to hear how you’re approaching this behemoth of a task.