Subject: DMBI Academic Year: 2021-22

Module 6
Business Intelligence
Topic: What is BI? Business intelligence architectures

What is BI?

BI(Business Intelligence) is a set of processes, architectures, and technologies that convert raw
data into meaningful information that drives profitable business actions. It is a suite of software
and services to transform data into actionable intelligence and knowledge.
BI has a direct impact on organization’s strategic, tactical and operational business decisions.
BI supports fact-based decision making using historical data rather than assumptions and gut
feeling.
BI 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.

How Business Intelligence systems are implemented?

Here are the steps:

Step 1) Raw Data from corporate databases is extracted. The data could be spread across
multiple systems heterogeneous systems.

Step 2) The data is cleaned and transformed into the data warehouse. The table can be linked,
and data cubes are formed.

Step 3) Using BI system the user can ask quires, request ad-hoc reports or conduct any other
analysis.

Prof. Geetanjali Kalme Department of Information Technology

 Examples of Business Intelligence System used in Practice
Example 1:

In an Online Transaction Processing (OLTP) system information that could be fed into product
database could be

• add a product line

• change a product price

Correspondingly, in a Business Intelligence system query that would beexecuted for the
product subject area could be did the addition of new product line or change in product price
increase revenues

In an advertising database of OLTP system query that could be executed

• Changed in advertisement options

• Increase radio budget

Correspondingly, in BI system query that could be executed would be how many new clients
added due to change in radio budget

In OLTP system dealing with customer demographic data bases data that could be fed would
be

• increase customer credit limit

• change in customer salary level

Correspondingly in the OLAP system query that could be executed would be can customer
profile changes support support higher product price

Prof. Geetanjali Kalme Department of Information Technology

 Example 2:

A hotel owner uses BI analytical applications to gather statistical information regarding

average occupancy and room rate. It helps to find aggregate revenue generated per room.

It also collects statistics on market share and data from customer surveys from each hotel to
decides its competitive position in various markets.

By analyzing these trends year by year, month by month and day by day helps management to
offer discounts on room rentals.

Example 3:

A bank gives branch managers access to BI applications. It helps branch manager to determine
who are the most profitable customers and which customers they should work on.

The use of BI tools frees information technology staff from the task of generating analytical
reports for the departments. It also gives department personnel access to a richer data source.

Four types of BI users

Following given are the four key players who are used Business In telligence System:

1. The Professional Data Analyst:

The data analyst is a statistician who always needs to drill deep down into data. BI system helps
them to get fresh insights to develop unique business strategies.

2. The IT users:

The IT user also plays a dominant role in maintaining the BI infrastructure.

3. The head of the company:

CEO or CXO can increase the profit of their business by improving operational efficiency in
their business.

4. The Business Users”

Business intelligence users can be found f rom across the organization. There are mainly two
types of business users

1. Casual business intelligence user

2. The power user.

The difference between both of them is that a power user has the capability of working with
complex data sets, while the casual user need will make him use dashboards to evaluate
predefined sets of data.

Prof. Geetanjali Kalme Department of Information Technology

 Advantages of Business Intelligence
Here are some of the advantages of using Business Intelligence System:

1. Boost productivity

With a BI program, It is possible for businesses to create reports with a single click thus saves
lots of time and resources. It also allows employees to be more productive on th eir tasks.

2. To improve visibility

BI also helps to improve the visibility of these processes and make it possible to identify any
areas which need attention.

3. Fix Accountability

BI system assigns accountability in the organization as there must be someone who should own
accountability and ownership for the organization’s performance against its set goals.

4. It gives a bird’s eye view:

BI system also helps organizations as decision makers get an overall bird’s eye view through
typical BI features like dashboards and scorecards.

5. It streamlines business processes:

BI takes out all complexity associated with business processes. It also automates analytics by
offering predictive analysis, computer modeling, benchmarking and other methodologies.

6. It allows for easy analytics.

BI software has democratized its usage, allowing even nontechnical or non -analysts users to
collect and process data quickly. This also allows putting the power of analytics from the hand’s
many people.

BI System Disadvantages
1. Cost:

Business intelligence can prove costly for small as well as for medium-sized enterprises. The
use of such type of system may be expensive for routine business transactions.

2. Complexity:

Another drawback of BI is its complexity in implementation of Datawarehouse. It can be so

complex that it can make business techniques rigid to deal with.

Prof. Geetanjali Kalme Department of Information Technology

 3. Limited use

Like all improved technologies, BI was first established keeping in consideration the buying
competence of rich firms. Therefore, BI system is yet not affordable for many small and
medium size companies.

4. Time Consuming Implementation

It takes almost one and half year for data warehousing system to be completely implemented.
Therefore, it is a time-consuming process.

Trends in Business Intelligence

The following are some business intelligence and analytics trends that you should be aware of.

Artificial Intelligence: Gartner’ report indicates that AI and machine learning now take on
complex tasks done by human intelligence. This capability is being leveraged to come up with
real-time data analysis and dashboard reporting.

Collaborative BI: BI software combined with collaboration tools, including social media, and
other latest technologies enhance the working and sharing by teams for collaborative decision
making.

Embedded BI: Embedded BI allows the integration of BI software or some of its features into
another business application for enhancing and extending it’s reporting functionality.

Cloud Analytics: BI applications will be soon offered in the cloud, and more businesses will
be shifting to this technology. As per their predictions within a couple of years, the spending
on cloud-based analytics will grow 4.5 times faster.

Types of BI Tools and Software

BI tools and software come in a wide variety of forms. Let's take a quick look at some common
types of BI solutions.

• Spreadsheets: Spreadsheets like Microsoft Excel and Google Docs are some of the
most widely used BI tools.
• Reporting software: Reporting software is used to report, organize, filter, and display
data.
• Data visualization software: Data visualization software translates datasets into easy-
to-read, visually appealing graphical representations to quickly gain insights.
• Data mining tools: Data mining tools "mine" large amounts of data for patterns using
things like artificial intelligence, machine learning, and statistics.
• Online analytical processing (OLAP): OLAP tools allow users to analyze datasets
from a wide variety of angles based on different business perspectives.

Prof. Geetanjali Kalme Department of Information Technology

 Components of Business Intelligence Architecture
One mistake that top leaders of many organization make is think of their BI system as
equivalent to front-end BI tools being used. Then there is another set of technical geeks who
make lot of discussion about a business intelligence architecture around som e fancy jargons
without giving due importance to what exactly comprises BI architecture.

The key elements of a business intelligence architecture are:

• Source systems
• ETL process
• Data modelling
• Data warehouse
• Enterprise information management (EIM)
• Appliance systems
• Tools and technologies

Source Systems – Transaction Processing Systems

This is the starting point for any BI initiative. Organization data is first created in these
databases. Point to note: if you do not capture the data in the operational system, you can’t
analyse it.

Operational systems (OLTP) form the bulk of the data needed for the data warehousing. In
addition to that, source systems may also include data from secondary sources such as market
data, benchmarking data etc. Business Intelligence architecture should address all these various
data sources which are of different formats and standards.

ETL Process
In an ETL process data is extracted from the operational systems and loaded into a data
warehouse. ETL, which stands for Extract Transform Load, is usually done using custom
solutions available in the market. IBM Websphere Data Stage, Oracle Data Integrator, Ab
Initio, and Microsoft Integration Services are examples of such tools.

Data Modeling
Data modeling will help to address what exactly is needed from data sources, the format of the
data, and how it will be related to other data elements. It is not feasible to extract everything

Prof. Geetanjali Kalme Department of Information Technology

 from a source system as that comes with cost issues. Data modeling will help to organize the
data and therefore will minimize cost of storage replication, and effort needed to build a data
warehouse.

Data Warehouse
Warehouse will have data extracted from various operational systems, transformed to make the
data consistent, and loaded for analysis. A data warehouse will help in achieving cross -
functional analysis, summarized data, and maintaining one version of the truth across the
enterprise.

Enterprise Information Management (EIM)

EMI is another BI jargon which may stump some beginners. The term usually refers to ETL
tools, data modeling tools, data quality, data profiling, metadata management, and master data
management.

BI Hardware
It is important to make decisions on the hardware requirements to maintain a high performance
and scalable BI system. Apart from server configurations, we have data warehouse appliances
to combine the server, the database, and the data storage into one system. Netezza and
DATAllegro are some well-known appliances in the market.

Tools and Technologies

Another important component of business intelligence architecture is what tools and
technologies to implement. It is not just the front-end UI tools, but the tools used for EIM as
well. There are cloud solutions, SaaS model, many f ull-fledged BI solutions (such as MSBI,
Oracle BI suites, Microstrategy and more) to choose from. BI framework should have
guidelines to make decisions on what is required for the organization.

Prof. Geetanjali Kalme Department of Information Technology