Business intelligence is defined as a process of collecting and processing business information to derive insights and make profitable business decisions.
Business intelligence depends on the process of business research to gather data that is then turned into actionable insights, typically using technological tools for deeper analysis. It comprises of collection, analysis, and presentation of business related information and is an outcome of business research which enables smart business actions.
For example, A restaurant owner wants to understand the preference of his customers about the type of cuisine they like, and thus evaluate the demand for a particular cuisine. A survey is conducted to collect feedback on various types of cuisines preferred. Based on this information, the owner can evaluate which cuisine is in demand amongst his target audience and help him to make a business strategy accordingly.
The goal of business intelligence is to collect information and analyze it, to support an organization to make better business decisions. Some of the trends related to business intelligence in the near future are as follows:
- Increased investment in AI technology
- Big data
- Increasing importance of data governance
- Increase in self-service business intelligence software and tools
- Data interpretation through storytelling
- Collaborative business intelligence
- Embedded business intelligence
- Cloud analytics
We all know that the ability to use data and technology in real time is one of the most important parameters to success, in today’s business world. It doesn’t matter what industry one is in anymore, the access to quick information is critical for an organization to make analytical and impactful decisions. Although, what needs to be clear is that data collection alone is not enough for insights; processing and analyzing that data is what leads to actionable insights that drive business decisions.
An organization requires to understand the demand, the customer wants and customer opinions to make strategic business decisions and achieve remarkable business success. Following is the methodology to gather business intelligence.
Step 1 – Data Collection
The first step in acquiring business intelligence is data collection. There are various methods to collect data, which can provide reliable information for statistical analysis and help an organization to make data-driven decisions.
Web/Online Surveys – Online Surveys is the most economical method to collect data and reach a large audience. Using such a method, enables the researcher to not only collect data but also analyze the same in a disciplined manner. This is the most widely used method nowadays. The results are real-time, the investment required is less and it takes a very short amount of time for the respondent to complete these, which in turn gives good response rates to the survey as well.
For example – A company wants to understand if their customers are satisfied with the customer service that is being provided to them and to understand how can they become more customer-centric. A customer service survey can be conducted to gather information about the staff, the product and the overall service provided to the consumer. It can be used to calculate Net Promoter Score (NPS), Customer Satisfaction Scores (CSAT) or even Customer Effort Scores (CES) to analyze the overall customer experience with the company, thus enabling the company to make business decisions to be a more customer-centric organization.
In-Person Surveys – In-person surveys are face to face interviews, one of the most effective methods to get the most accurate information. In this method, it is easy to identify if the respondent is uncomfortable with certain questions, disinterested in the topic and sometimes even to identify wrong feedback using observational techniques like body language, expressions, the tone of speech, etc. Such a method is usually costlier than other methods and needs a certain level of expertise to gather valuable information.
For example – An organization conducts face to face interviews with employees to evaluate their immediate supervisors. In such a case, supervisor evaluation survey questions can be used to conduct the interview so as to gather accurate information to help promote a better work culture in an organization.
Mail Surveys – This is the age-old traditional method to gather information from a large set of audience. Nowadays, this method is not used much, as technology has reached every nook and corner of the world and also because, it requires more time, has a low response rate, is expensive and is prone to errors. Online surveys are a good substitute for such a method, however, geographies where tablets, computer or laptops are still inaccessible, mail surveys are the best way to gather data from that set of audience.
For example – A government wants to conduct a survey to understand public opinion on the use of plastic bags and to evaluate their awareness regarding government initiatives to abolish them. A use of plastic bags survey can be mailed to the audience from different localities to gather information for that area, and accordingly corrective measures can be taken by the government.
Telephone Surveys – Telephone surveys are a little costlier than online surveys but much inexpensive compared to face to face surveys. Such a method has a few drawbacks such as the availability of the respondent or even establishing a friendly equation with the respondent.
For example, A church wants to conduct a survey to understand why parishioners attend church and to evaluate if their spiritual needs are being met by the church. A church survey will enable them to conduct telephonic surveys with all the parishioners to get reliable information and help them understand the audience opinions.
- Questionnaires – A questionnaire is a set of questions used for research purpose which can be qualitative as well as quantitative in nature. A questionnaire may or may not be in a form of a survey, however, a survey always has a questionnaire.
For example – An HR of a company wants to conduct an exit interview to find out the opinion of an employee for his time spent at the organization. Exit interview questions can be a pre-set questionnaire that can be used by an organization for every employee that decides to leave the company so that employee retention strategies can be formulated accordingly based on the employee responses.
- Polls – Polls are a little different than surveys and such a method usually consists of only one question. The response rate for polls is extremely high, as it is very easy to answer and it takes very less time.
For example – The best example for a poll would be election polls. Polls are conducted to find out which party the public prefers that would govern the specified area in that year.
- Forms – Forms are a type of survey itself, however, forms are generally used to collect specific information from a respondent in each field such as age, income, gender, etc, unlike surveys which are used to gather generalized data such as opinions, attitudes, values, etc.
For example, A bank needs specific information from its customer to open a bank account. In such a scenario, a form is provided to the customer to collect specific information required by the bank to open an account.
Step 2 – Analysis
This is the step where all the data has to come under a single platform. A Business Intelligence software will enable you to collect as well as analyze data with advanced analytical methods using the same software with the click of a button. Analyzing the data collected through various methods will help an organization to understand, what are customer opinions and where improvements are needed. The software allows you to compare scores (such as NPS, CES, CSAT) for varied time periods and also among departments. You can also analyze the data using advanced techniques such as Conjoint Analysis, Maxdiff Analysis, Trend Analysis, Text and Sentiment Analysis and many more. This way, you can get a solid snapshot of where your organization stands at any given time among your customers.
For example, It is crucial for the Hospitality industry to measure customer experience and satisfaction on an ongoing basis. By analyzing and monitoring customer satisfaction scores and NPS scores consistently, the organization can improve their customer’s experience and become more customer-centric to achieve higher revenues and customer loyalty.
Step 3 – Reporting and Presentation
After analysis, the next step is to understand what the metrics mean. This step is the most important step, as the wrong interpretation of the data can send your organization down a cliff. Conversion into visual infographics can sometimes make it easier for a person to understand. Such understanding will enable an organization to find answers to most pressing business, operational and marketing questions.
These steps will help you to start using business intelligence effectively, however, this is not the final step. An organization needs to continuously monitor and analyze real-time data to stay in the competition and keep meeting the ever-changing customer needs or even to figure out the next best steps for the future. Following this path to utilize business intelligence effectively will provide an organization to spend money and time more wisely and tackle future goals, needs, and trends successfully.
Business Intelligence has a direct impact on an organization’s strategic, tactical and operational business decisions. It supports fact-based decision making using historical data rather than assumptions and gut feeling. These tools perform data analysis and create reports, summaries, dashboards, maps, graphs, and charts to provide users with detailed intelligence about the nature of the business. Following are some advantages of Business Intelligence:
- Business Intelligence helps to boost productivity in an organization using reports, analytical dashboards, and infographics.
- It provides an organization with a holistic view of their company, segmented into various departments, products, services, etc making it easier to identify areas that need attention or improvement.
- Complex processes in an organization can be streamlined using advanced automated analytics, enabling a company to reduce time and effort leading to faster and efficient business processes.
- Visual infographics and easy to understand reports can be generated using BI software allowing even non-technical individuals to understand the meaning of their metrics.
In today’s world, there is a need for business intelligence to enjoy a competitive advantage in an ever-changing business environment. Business intelligence helps an organization to evaluate customer opinions, the market and customer behavior, which can give you an opportunity to win higher market shares and reap high revenues. Following are some reasons why business intelligence is an asset to any organization:
- Gather Actionable Insights – Business intelligence is transforming business oriented raw data into usable information. Raw data will not give you actionable insights about your business parameters but BI will provide an organization with a comprehensive analysis of data to identify pain points or opportunities that can be used to devise more customer-centric strategies.
- In-depth Understanding of the Organization – It is difficult to understand the business as a whole if you don’t know each component of the business, including those that are often overlooked. Business intelligence enables an organization to identify each component that requires attention and make improvements accordingly.
- Achieve Sales and Marketing Targets – Achieving those sales and marketing goals are difficult if the company does not understand the target market, the trends or the ever-changing customer needs. Business intelligence will deliver in-depth analysis to kickstart an organization’s sales, boost the performance of the marketing function and help in synchronizing both the teams to achieve those sales and marketing goals.
- Anticipate Buyer Behavior and Trends – Customer engagement is a buzz word being spoken about in today’s business world and hence drawing prospective customers to you is essential, rather than relying on old outdated techniques based on hard sell. A business intelligence software will enable a company to create holistic customer profiles based on their every interaction or every feedback during the customer journey. This will allow you to gather valuable intelligence to provide you with detailed insights on buyer behavior and trends, thus allowing you to improve your sales, marketing or growth strategies accordingly.
- Boost Overall Productivity – Many organizations have inefficient bottlenecks, old traditional processes and manual routine tasks that hinder the growth of an organization. Business intelligence software can release these bottlenecks, automate routine tasks and refine processes bringing new levels of organization and prioritization to everybody’s work. This will enable efficient and highly responsive customer service, better use of human resources, accurate measurement of marketing campaigns thus boosting the overall productivity across the organization.
- Accelerated ROI – Last but not the least, business intelligence helps an organization to accelerate ROI by managing day-to-day efficiency, sales conversion metrics and customer experience through analysis and modelling. Business intelligence will enable a company to get valuable insights on consumer buying behavior, customer experience, and customer needs, which will put the organization on a path towards success.
Gone are the days when organizations relied on making the best guess or going with the gut feel. Business intelligence provides an organization with accurate data, updates in real time, trending and forecasting means and even allows you to predict “what-if” scenarios, therefore removing the need to guess or estimate.