Business intelligence (BI) is a collection of apps, procedures, and infrastructure that give data access and analysis to help you make better decisions and perform better. To bridge the gap between data, insights, and actions, modern BI technologies combine data integration, data analytics, and data literacy.
A business intelligence strategy is a plan on how to use the data generated by a company. This information might come from a number of sources inside your organization, including human resources, supply chain, manufacturing, finance, customer relationship management, and others. People, processes, and technology all play a role in a successful BI approach.
Why Do Businesses Need A BI Strategy?
Business intelligence is a catch-all phrase for the procedures of gathering, storing, and analyzing data from your company to improve performance. To improve performance, you’ve probably set goals for your firm and are wondering how to get there. For instance, a goal could be to enhance your profit margin by 2% in the coming fiscal year, and a query could be how to improve process efficiency to make your firm more profitable.
A large part of BI is achieving those goals and addressing particular queries. Business intelligence tools can assist by mining data to find trends in big data sets, reporting this research so you can draw inferences from the data, and then benchmarking future efforts against previous performance and even industry standards. In this situation, business intelligence tools may be useful in identifying common and costly supply chain disruptions, underperforming business units, or other bottlenecks. You may leverage customer, operational, and performance data to help expand your business and stay competitive by running direct queries and visualizing data. A BI strategy identifies areas for improvement in how you handle your data, analysis, reporting, and choices.
The Upsides Of A Bi Strategy
1. Speedier Deployment And More Varied Reports
Obtaining the appropriate software for BI tools is only the first step. Next, you must determine how your company’s data will be managed and reported. You will gain from speedier deployment and more varied reports and visualizations in your dashboards if you include not only the platforms but also who will use the software, when it should be utilized, and how it can be used.
You can, for example, increase revenue with sales performance dashboards or improve human resource tasks with compensation and employee performance data. Systematically tackling data discovery, analysis, and reporting across your organization can make BI use more efficient.
2. More Efficient Reporting And Analysis
One of the most significant advantages of a solid BI is reliable and speedy self-service functionality. When users have queries about business data, they don’t have to go to an IT team, file a request, and wait for someone to manually mine the data, structure it, analyze it, and return it. Instead, you can be confident that your team will have access to simple insights delivered through dashboards and other reports based on correct data. Creating a BI plan can assist all levels of your firm, whether it’s research into a topic (e.g., a supply chain manager wishing to understand lead times) or broad inquiries into progress toward corporate goals.
3. Risk Mitigation
Assume your retail business is thinking about expanding into a new site. With additional space to store inventory and provide more products to clients, this investment has the potential for a high return. However, doing so carries risks. While no one can foretell the future, data can help us manage financial risk by anticipating future conditions based on historical trends and other data. Significant business decisions are frequently fraught with danger. And data can assist you in making more educated judgments and understanding the risk before you take the plunge.
The Essential Elements of a BI Strategy
- Vision: The BI strategy vision establishes expectations. It is what everyone agrees the approach will entail. Some BI plans, for example, have solely reporting and analytics purposes.
- People: A BI strategy should have executive sponsorship or someone in leadership serving as the driving force and support. Educate them on the ROI of the BI approach and how it helps your organization compete in its industry. Define the roles of other personnel involved, such as deciding which data or analysis each department needs.
- Process: Document the strategy’s present situation, such as current access vs needs or data silos versus needs. Determine the gaps between the goal state and the current state. Also, define the process needs in terms of the current and final states. Create a strategy roadmap using this information.
- Tools: The term “tools” refers to software and other necessary equipment. Choosing tools may have to wait until you’ve determined what BI means in your organization and whether it incorporates technology. Discover examples of BI tools and applications and how they fit into a BI strategy.
Top 8 Business Intelligence Best Practices
1. Obtain Organization-Wide Support
Disjointed BI methods and failed widespread adoption are surefire ways to fail in BI. It is critical to obtain organization-wide buy-in for BI success. It is in everyone’s best interest; in the end, BI will assist every department, particularly Sales, Marketing, Finance, and Management. For that purpose, stakeholders should be involved from the start. This best practice includes bringing CIOs and CMOs together from the start!
Another essential stakeholder you should involve from the start is IT. Yes, the correct SaaS BI tool will not necessitate any IT heavy lifting. It is not to say that IT should not be involved in the analytics procurement, implementation, and management processes. IT and development teams have important knowledge bases that should be used. They can make sure that relevant security and governance procedures are followed. It is an excellent resource for knowledge retention and transmission. Finally, while IT is not required to administer the BI, they should be kept informed.
2. Create A Strategy From The Onset
Analyzing without a plan can cost you money, time, and stress. Before selecting a BI tool, you must first identify the business demands and create a list of business criteria and goals. These should not be developed in a vacuum or at the executive level. Consult with all stakeholders, including finance, marketing, sales, and operations, because you already have organizational-wide buy-in (right?). Finally, having pre-determined key performance indicators (KPIs) and clear objectives can help steer a successful BI deployment.
3. Start Small
There’s a good chance you have a lot of business inquiries and insights you’d like to obtain. When you begin to compile these requirements and consider the overall size of your data, it is simple to become overwhelmed. It is exacerbated when every employee begins begging for data right now. It brings us to the following business intelligence best practice: Begin small. Begin with a short set of critical questions. Try to respond to them using readily available data.
If you wind up having answers, that’s fantastic. This procedure is likely to generate more questions that you can add to your roadmap. This approach will also assist you in determining what data sources you need to gather, and what data you are missing in general.
4. Determine The Appropriate Data Sources
Regardless of size, your firm is most likely gathering data on most business operations. The issue is that this data is dispersed across multiple systems and software. Data can be saved in ERP systems, CRMs, databases, and Excel spreadsheets, among other places. Getting the information you need might be difficult when data is dispersed across several systems. It is where you should start modestly and identify the data sources you’ll need to get started.
Consider your data as responses to specific inquiries rather than an overwhelming bulk. Approach it with a question or a hypothesis in mind, and see if the evidence collected confirms your notion. Finally, you may benefit from a data warehouse to boost performance. You may compile and blend numerous data sources with the correct tool.
5. Foster A Data Culture
To bring your organization on board with a new BI strategy, you need to evangelize the value of data. For your BI to be successful, your firm must cultivate a data culture. When a company’s departments collaborate to achieve a similar goal, the data insights and subsequent actions are more meaningful and valuable.
There may be some pushback. Departments may be discouraged from pushing corporate adoption of BI due to a lack of time, data-savvy, and resources. They may fail to recognize that the expenses of adoption outweigh the benefits. They must understand how the appropriate tool will assist all teams.
Some consumers may be put off by new technology and data. It might lead to resistance to change. Work to demonstrate that, while some training may be required, the correct tool will empower anyone to be their analyst. Look for a technology that enables a diverse set of users to connect to, study, visualize, and convey their data with ease. Adoption will also be driven by simple drag-and-drop interfaces that require no training and no prior data analysis or SQL abilities. Giving employees access to business dashboards they can use motivates them to make quick and confident decisions, which benefits the firm.
6. Consider A Togaf Or Zachman Framework
The Open Group Architecture Framework (TOGAF) and the Zachman Framework are approaches to corporate architecture development that provide structure. Choose one to assist in the organization of technology, processes, and information assets.
7. Use Feedback Loops During Implementation
Working well with staff entails defining issues, resolving issues, and soliciting feedback from staff before ending it. Feedback loops transform potential improvements into action through a phased implementation. The feedback loops are what keep the BI lifecycle improving.
8. Educate And Empower The Business Community As A Whole
A goal of business intelligence is to provide knowledge to the larger corporate community. Data literacy can be improved by training individuals and departments on standard company language and KPIs. Furthermore, developing self-service business intelligence capabilities democratizes data for easier access and faster insights. Training and education can improve understanding, performance, and investment in corporate goals.
Business intelligence is evolving in response to company needs and the expanding technological landscape. Companies that want to keep up with breakthroughs in artificial intelligence and machine learning will need to stay adaptable and incorporate innovations into their business intelligence strategy. These business intelligence best practices are critical implementations for maintaining a competitive edge and gaining deeper insights into the nature of your organization.
Top 5 Business Intelligence Worst Practices
1. Build Everything On Day 1
It’s much more exciting to have access to previously isolated data. It is tempting to open the floodgates and create dashboards for everything. As previously indicated, start small. Otherwise, you’ll have a lot of noise and unused reports/dashboards. Worse, if you don’t regulate the data analytics deluge, you can wind up with inaccurate dashboards being shared. You don’t want to deal with the hazards of data misunderstanding. Poor data management is also the quickest way to destroy a data culture and lose faith in a BI solution.
2. Allow Everyone Immediate Access To BI
Along the same line, don’t create a flood of new BI users. When they aren’t utilizing the system or don’t require it, don’t give them access. Ensure that users are appropriately taught and that good governance is in place. As a general guideline, proper governance should guarantee that assets are implemented and used following agreed-upon policies and procedures; that these assets are appropriately regulated and maintained; and that these assets serve your organization’s strategy and business goals.
In today’s cloud-based environment, it might be challenging to maintain complete control over infrastructure provisioning, de-provisioning, and operations. Another incentive is to involve IT in the selection, brokerage, and governance of BI technologies. Look for a partner who can also give governance help and best practices.
3. Make Everything Flawless From The Start And Then Walk Away
Your BI will not be flawless. Big data provides insights into real-time data, allowing you to make changes immediately when you notice a trend emerge. The key word in the sentence is “changes.” Your market, competitors, company landscape, and organization are all always evolving. Your BI will have to do the same. Maintain your agility by going back to the drawing board at regular intervals. In the end, you may have to discard entire dashboards. It is all part of the BI success process.
4. Excel Should Only Be Used When Essential
Excel should not be your primary business intelligence platform. Most of us are familiar with Excel; it’s been a favorite for a long time! However, Excel was not designed for business intelligence. It is easy to get into data integrity concerns with Excel, as the data isn’t real-time, spreadsheet upkeep rapidly becomes a full-time job, collaboration is hard, and this opens up all sorts of governance issues.
Interactive live dashboards, on the other hand, instantly engage end-users with varying levels of technical expertise and give an intuitive experience and easily absorbed insights. They also provide ROI by swiftly identifying trends and uncovering abnormalities. It may take time to transition your BI culture away from Excel, but it will be worthwhile. If users download dashboards to Excel to better comprehend the data, more training is required and the dashboard has to be improved.
5. When Evaluating BI Systems, Avoid Discussing Security
Security has been a concern since the beginning of cloud computing technology, and for good reason: you can’t see where your data is stored or processed. Headlines about data breaches and state-sponsored hacking activities haven’t helped to relieve those fears. Poor practice in business intelligence is not voicing or vetting BI possibilities.
Fortunately, security capabilities are evolving. You only need to check that the SaaS provider has secure user identity management, authentication, and access control systems to safeguard your organization’s privacy and security. Check what data security and privacy legislation they are subject to. While reviewing a provider’s security and privacy policies, ensure compliance. No matter where your data is, your firm must be able to comply with legislation and standards. With storage, ensure the provider has strong data recovery rules in place.
A BI plan is always built with a company strategy in mind, as we discussed several times throughout the article. How will BI assist you in meeting your company objectives? It is also a task of enterprise architecture, the practice of determining how technology may help you achieve your overall goals.
Enterprise architects utilize frameworks to evaluate a firm’s existing status and propose adjustments. Frameworks are decades-old approaches that help see the company from all perspectives. TOGAF and the Zachman framework are two popular BI strategy frameworks. Filling up the templates allows you to draft your needs and align new processes without losing sight of the big picture. They are also used to present your idea to the team and continuously improve your project.