Brief Notes on Business Intelligence & Data Mining BI

Dr.  S.  Maurer,  
MBA Professor

Some industries,  such as financial servicës,  have become very sophisticated in using bi software for financial reporting and consolidation,  customer intelligence,  regulatory compliance,  and risk management.

Once business intelligence is gathered effectively and used proactively you can make decisions that benefit your organization before the competition does.

Merchandising   -   This is clearly the most important area of a retailer's business and an area where retailers are beginning to exploit the full value of bi.

Reasons for business intelligence: business intelligence enables organizations to make well informed business decisions and thus can be the source of competitive advantages.  This is especially true when you are able to extrapolate information from indicators in the external environment and make accurate forecasts about future trends or economic conditions.

Innovate   -   This level represents a major,  quantum break with the past.  it exploits the understanding of the value-creation process acquired in the optimize stage and replicates that efficiency with new products in new markets.  enterprises operating at this level understand what they do well and apply this expertise to new areas of opportunity,  thus multiplying the number of revenue streams flowing into the enterprise.

marketing   -   By understanding customers better   -   whether by profiling,  segmenting,  gauging propensity to respond,  or using market basket analysis   -   retailers can create better-defined targeted campaigns,  reducing expenses [printing,  paper,  postage] while increasing response rates,  revenues,  and gross margins.

business intelligence reveals to you: The position of your firm as in comparison to its competitors i.e.  market share; Changes in customer behaviour and spending patterns; Customers' preferences; The capabilities of your firm; Market conditions,  future trends,  demographic and economic information; The social,  regulatory,  and political environment; What the other firms in the market are doing; You can then deduce from the information gathered what adjustments need to be made.

Secondary sources of information include customer needs,  customer decision-making processes,  the competition and competitive pressures,  conditions in relevant industries,  and general economic,  technological,  and cultural trends.

Improved Extract,  transform,  load [ETL] and even recently enterprise Application Integration tools have increased the speedy collecting of data.  OLAP reporting technologies have allowed faster generation of new reports which analyze the data.

bi relates to the intelligence as information valued for its currency and relevance.  it is expert information,  knowledge and technologies efficient in the management of organizational and individual business.

bi that remains segmented by functional area can provide some value,  but retailers can realize a much larger return by building the foundation upon which the rest of the house will stand.  This is true of both top-tier and midmarket retailers,  regardless of segment.

Results-related queries: Someone should monitor the bi programme to ensure that objectives are being met.  Adjustments in the programme may be necessary.  The programme should be tested for accuracy,  reliability,  and validity.  How can one demonstrate that the bi initiative [rather than other factors] contributed to a change in results? How much of the change was probably random?.

A solution seeking to use customer behavioral data to make better merchandising or marketing decisions needs to interface with sales transaction systems,  loyalty systems,  in-house credit systems,  coupon redemption systems,  catalog and internet customer data systems,  and so forth.

The term bi implies having a comprehensive knowledge of all of the factors that affect your business.  it is imperative that you have an in depth knowledge about factors such as your customers,  competitors,  business partners,  economic environment,  and internal operations to make effective and good quality business decisions.  business intelligence enables you to make these kinds of decisions.

business intelligence technology: business intelligence provides organizational data in such a way that the organizational knowledge filters can easily associate with this data and turn it into information for the organization.