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Business intelligence tools can help your company grow more quickly, decrease costs and improve customer relationships.
By 2033, the global business intelligence market is expected to grow to $26.5 billion, Market.us reports. Whether you have a small business or an enterprise, your company can benefit from BI solutions to stay ahead of the curve, decrease operating costs, and sustain and grow customer relationships.
We’ll explore business intelligence (BI), its pros and cons, and how BI relates to competitive intelligence and artificial intelligence (AI).
Business intelligence is an umbrella term that includes best practices, software, infrastructure and other tools to optimize decision-making and enhance a business’s performance.
In essence, BI is about information analysis. A database pulls together information from the different parts of your business, and then applications convert that raw data into reports, charts and other analytical tools to provide insights.
The term “business intelligence” first appeared in the 1960s to describe a system for sharing information among departments. Today, BI tools enable self-service data management and digital data analysis.
This raw data is processed and stored using physical locations and digital cloud storage methods. Once the data is stored, business leaders can easily access it and even turn it into aesthetically pleasing visuals for key presentations.
BI software efficiently collects data to help owners and managers make informed business decisions. These valuable insights can help your company adapt to industry and market fluctuations. Here are some ways data can be collected and analyzed:
You may find that the information you collect leads to more questions. Use such analytics to investigate your company’s growth potential and plan better for the future by answering questions as they arise.
BI also offers dashboards and performance scorecards. When data is visualized, key performance indicators and business metrics are much easier to understand.
Proper data analysis can mean the difference between a modest profit and outrageous success. Business intelligence offers insight into industry trends and helps you spot effective marketing opportunities you would have missed otherwise. Business intelligence also helps you learn what customers want and need from your company so you can redesign your business to gain more customers.
Here are some of the ways small businesses can use analytics:
Several business intelligence tools are available to organizations of all sizes. While some focus on one aspect of data, others offer a direct solution. Here is a list of popular business intelligence tools:
BI tools can help take your business to the next level. By increasing your workforce’s productivity and improving the customer experience, BI tools provide the data you need to make proactive business decisions.
BI tools can assign tasks and reporting to teams and individuals to create a traced accountability system within the business. Holding your team accountable can increase loyalty by providing each person with a clear understanding of their role and reducing confusion among departments.
BI tools boost productivity in several ways:
BI gives companies access to a wide variety of data that can help streamline business processes, eliminate bottlenecks and set measurable standards. Data reporting can be used in real time, leading to better, faster business decisions.
For example, team members can analyze detailed client information and forecasts before a sales meeting. As a result, it’s easier to connect with the client and conduct business more professionally.
By using BI tools to analyze customer data, you can determine how to engage customers, anticipate buying hotspots and downturns, and monitor industry and market changes. Anticipating your customers’ needs is a substantial competitive advantage.
BI tools also help your customers. By connecting phone records, text data from live chats, and prior purchases, you can use data history to offer excellent customer service.
Although BI tools offer many benefits, they’re not always easy to implement, especially for small businesses. Before you dive in, consider these potential drawbacks.
BI tools can be costly, and they require a significant upfront investment. Over time, they offer a return on investment, but usually not within the first year. If cost is a concern, consider using self-service BI tools, which do not require IT support for onboarding or minor adjustments.
Depending on your knowledge of business tools, you might have to hire a team for onboarding and initial training. Plus, if you use different BI products and try to combine them, the data could be confusing and even overlap. Look for an all-in-one BI solution that can house all of the necessary tools, or find a third-party data connector to make sense of the various information you gather from different BI tools.
If you invest in BI tools that house your customer and employee data, any error in your system could put that information in the wrong hands. To decrease the risk of a data breach, choose a BI company with the best security practices and thoughtfully decide which data you will allow your BI tools to access.
The implementation of new tools across all departments can come with obstacles. Although some departments might catch on quickly and find that BI tools benefit their time and knowledge, others may find it cumbersome and give up on it entirely. Look for intuitive software that solves employee complaints and has clear actions and goals.
BI is often synonymous with competitive intelligence and is also confused with business analytics. However, there are some important distinctions.
BI and AI overlap in their technological applications. BI and AI tools create valuable data from their analytics, allowing businesses to translate that data into informed business decisions.
However, their goals are significantly different. BI tools streamline data collection while automating the frequency and improving how a business utilizes the data. By using BI tools in various departments, your team can collect and aggregate that data to make informed business decisions.
By contrast, AI tools are built to model human intelligence in the form of rational decision-making. For example, in certain instances, an AI chatbot can replace customer service reps. While it doesn’t necessarily improve customer relationships, it can fill the real-time gap for simple questions or concerns.
Tom Drake contributed to this article.