Business Intelligence

Lecture 25

What is Business Intelligence (BI) Definitions:

• Business Intelligence (BI) refers to skills, processes, technologies, applications and practices used to support decision making.

• Systems that provide directed background data and reporting tools to support and improve the decision-making process.

• A popularized, umbrella term used to describe a set of concepts and methods to improve business decision making by using fact-based support systems. The term is sometimes used interchangeably with briefing books and executive information systems.

• Business Intelligence is a broad category of applications and technologies for gathering, storing, analyzing, and providing access to data to help clients make better business decisions.

• A system that collects, integrates, analyses and presents business information to support better business decision making.

• Business Intelligence is an environment in which business users receive information that is reliable, secure, consistent, understandable, easily manipulated and timely...facilitating more informed decision making

What is BI (continued)

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Improving organizations by providing business insights to all employees leading to better, faster, more relevant decisions

What is Business Intelligence?

Business Intelligence enables the business to make intelligent, fact-based decisions

Aggregate Data

Database, Data Mart, Data Warehouse, ETL Tools,

Integration Tools

Present Data

EnrichData

Inform a Decision

Reporting Tools, Dashboards, Static

Reports, Mobile Reporting, OLAP Cubes

Add Context to Create Information, Descriptive Statistics, Benchmarks, Variance to Plan or LY

Decisions are Fact-based and Data-driven

Content

The business determines the “what”, BI enables the “how”

Performance

Minimize report creation and collection times (near zero)

Usability

Delivery Method Push vs Pull

Medium Excel, PDF, Dashboard, Cube, Mobile Device

Enhance Digestion “A-ha” is readily apparent, fewer clicks

Tell a Story Trend, Context, Related Metrics, Multiple Views

CPU – Content, Performance, Usability

Core Capabilities of BI

OLAP (online analytical processing) enables a user to easily and selectively extract and view data from different points-of-view.

Why do companies need BI?

Tactical / Strategic BI

What’s the best that can happen?

What will happen next?

What if these trends continue?

Why is this happening?

What actions are needed?

Where exactly is the problem?

How many, how often, where?

What happened?

Sophistication of Intelligence

Operational BI

Optimization

Predictive Modeling

Forecasting/extrapolation

Statistical analysis

Alerts

Query/drill down

Ad hoc reports

Standard reports

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How Important is BI?

Top 10 Business and Technology Priorities for 2011:

1. Cloud computing 2. Virtualization 3. Mobile technologies 4. IT Management 5. Business Intelligence 6. Networking, voice and data communications 7. Enterprise applications 8. Collaboration technologies 9. Infrastructure 10. Web 2.0

Source: Gartner’s 2011 CIO Agenda (aka “

Reimagining IT: The 2011 CIO Agenda”).

The July 2010 Forrester report “Technology Trends That Retail CIOs Must Tap to Drive Growth” identified the following technologies that retail CIOs should be considering as part of an overall architecture strategy:

Mobile

Cloud

Social Computing

Supply Chain

Micropayments

Business Intelligence/Analytics

Why is Business Intelligence So Important?

Time

With Business Intelligence, we can get data to you in a timely manner.

Making Business Decisions is a Balance

Data Opinion

(aka Best Professional Judgment)

In the absence of data, business decisions are often made by the HiPPO.

Benefits of Business Intelligence

• Improve Management Processes– planning, controlling, measuring and/or changing resulting in

increased revenues and reduced costs

• Improve Operational Processes– fraud detection, order processing, purchasing.. resulting in

increased revenues and reduced costs

• Predict the Future

Examples- EMC

• 1998: Revenue $2.5b• 1998: HW (90%) + SVCS (10%) + SW (0%) Strategic BI: predictive modelling => decision

made

• HW (10%) + SVCS (10%) + SW (80%)• 2010: Revenue $16b

0

100

200

300

400

500

600

700

1 2 3 4 5 6 7 8 9 10 11 12 13

Fiscal Week

$ M

illi

on

s

• Factories ship ≈40% of quarterly revenue in last week!

• Build to Stock for orders in last two days!

Typical Activity by Week ($M) (Storage Products)

Bookings

Factory Shipments

EMC Quarter Activity

EMC Order Life Cycle

Prospect Lead Oppty Configure Price Quote Order Produce Ship Invoice Collect

CommissionsAccount Planning ProjectAccounting

ServiceSuspect

Channel IntegrationQuota

Examples- Walmart• Average daily sales of American Flags = 6,000 • September 11th 2001 • All competitors ran out of flags • Nearest rival sold 20,000 • Walmart sold 116,000 flags on that day alone

Further examples• Call centres

– e.g. Top Agent awarded bonus -> competition leading to performance improvements • Banks

– jettison walk in customers to encourage online only • Criminal Minds

– Information gathered on previous actions of serial killers allows the team to predict the actions of future serial killers

• Revenue Service– who has the yacht but cannot afford it

• Plagiarism detection in colleges

• Customer Loyalty Programs

• Twitter analysis for public mood

• Dell

• Healthcare– predicting infection in rural parts of third world

BI Golden Rules• Data Quality & Accuracy

• Data Consistency

• Data Timeliness

“Get the right information to the right people at the right time”

Gartner BI Maturity Model

Major BI Trends Mobile

Cloud

Social Media

Advanced Analytics

What BI technologies will be the most important to your organization in the next 3 years?

1. Predictive Analytics2. Visualization/Dashboards3. Master Data Management4. The Cloud5. Analytic Databases6. Mobile BI7. Open Source8. Text Analytics

TDWI Executive Summit – August 2010

Advanced Analytics / Predictive Analytics

Data Mining Regression Monte Carlo Simulation “Statistically Significant” Predicting Customer Behavior

Churn/AttritionPurchasesProfiling

BI Today vs Tomorrow “BI today is like reading the newspaper”

BI reporting tool on top of a data warehouse that loads nightly and produces historical reporting

BI tomorrow will focus more on real-time events and predicting tomorrow’s headlines

Collegiate Admissions Criteria Test Scores: SAT, ACT, AP Exams Grade Point Average Class Rank High School “Strength” Extracurricular Activities: Band/Choir, Clubs, Sports Non-School Activities: Work, Volunteer, Community Groups Area of Focus – Intended Major Family legacy Home State or Country

Regression Outcome = Graduation (binary) + GPA (linear)

Retail Analytics

Market Basket Analytics Text Analytics Customer Segmentation/Clustering Tailored Product Assortments Inventory Forecasting

25

Amazon.com and NetFlix

Collaborative Filtering tries to predict other items a customer may want to purchase based on what’s in their shopping cart and the purchasing behaviors of other customers

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What Is Text Analytics?

…turning unstructured customer comments into actionable insights

…finding nuggets of insight in text data that will improve our business

From Wikipedia:… a set of linguistic, statistical, and machine learning techniques that model and structure the information content of textual sources for business intelligence, exploratory data analysis, research, or investigation

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Customer Sat Survey

Comments

Unstructured Text Processing

Facebook Page

Blogs

Competitors’ Facebook

Pages Public Web Sites, Discussion Boards, Product Reviews

Alerts, Real-time

Action

TwitterPage

Services

Quality Cost Friendliness

Email

Adhoc Feedback

Call Center Notes, Voice

What is Information Governance?

Information Governance

•Data Stewardship•Data Quality

•Data Governance•Master Data Management•Data Stewards for Master Data “Hubs”•Customer, Vendor, Product, Location, Employee, G/L Accounts

PREVENTS

Garbage In

Garbage Out

BY ENCOMPASSING

•Report Governance

•Metric Governance

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CREATING SIGNIFICANT BUSINESS VALUE

BI TechnologiesAnalytic Databases

BI is a consolidating industry

Oracle: Siebel, Hyperion, Brio, Sun SAP: Business Objects, Sybase IBM: Cognos, SPSS, Coremetrics, Unica, Netezza EMC: Greenplum HP: Vertica Teradata: Aster Data

Independent vendors: MicroStrategy, Informatica, SAS

Reporting standards determined mainly by Microsoft, Apple and Adobe

TeradataNetezza

DB2OracleSQL Server

VerticaAster DataPar AccelGreenplum

Semantic Databases(TIDE)

Why do companies need BI?

ANALYTICS(Tactical & Strategic)

What’s the best that can happen?

What will happen next?

What if these trends continue?

Why is this happening?

What actions are needed?

Where exactly is the problem?

How many, how often, where?

What happened?

Sophistication of Intelligence

DATA ACCESS & REPORTING(Operational)

Optimization

Predictive Modeling

Forecasting/extrapolation

Statistical analysis

Alerts

Query/drill down

Ad hoc reports

Standard reports

Co

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etit

ive

Ad

van

tag

e

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Summary We covered Today

Knowledge and Knowledge ManagementBusiness Intelligence overview