Application of Business Intelligence
Business intelligence applications and technologies enable organizations
to make more informed business decisions. Although BI should not
be confused with competitive intelligence, BI tools do give a company
a competitive advantage.
Using BI For Competitive Advantage
For example, a company could use business intelligence applications
or technologies to extrapolate information from indicators in the
external environment and forecast the future trends in their sector.
Business intelligence is used to improve the timeliness and quality
of information and enable managers to better understand the position
of their firm in comparison to its competitors.
Business intelligence applications and technologies can help companies
analyze the following:
- changing trends in market share
- changes in customer behavior and spending patterns
- customers' preferences
- company capabilities and market conditions.
Business intelligence can be used to help analysts and managers
determine which adjustments are most likely to affect trends.
BI Based Business Decisions
Business intelligence systems can help companies develop consistent
and "data-based" business decisions — producing
better results than basing decisions on "guesswork."
In addition, business intelligence applications can enhance communication
among departments, coordinate activities, and enable companies to
respond more quickly to changes (e.g., in financial conditions,
customer preferences, supply chain operations, etc.) because they
are usually supported by a data warehouse on which analytical information
about these processes resides.
When a BI system is well-designed and properly integrated into
a company's processes and decision-making process, it may be able
to improve a company's performance.
Having access to timely and accurate information is an important
resource for a company, which can expedite decision-making and improve
BI Supports Product Development
In the competitive customer-service sector, companies need to have
accurate, up-to-date information on customer preferences, so that
the company can quickly adapt to their changing demands.
Business intelligence enables companies to gather information on
the trends in the marketplace and come up with innovative products
or services in anticipation of customer's changing demands.
Business intelligence applications can also help managers to be
better informed about actions that a company's competitors are taking.
Enhancing Business Peformance
BI can help companies share selected strategic information with
business partners. For example, some businesses use BI systems to
share information with their suppliers (e.g., inventory levels,
performance metrics, and other supply chain data).
BI systems can also be designed to provide managers with information
on the state of economic trends or marketplace factors, or to provide
managers with in depth knowledge about the internal operations of
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