Definition of business intelligence
Business intelligence is the intelligence method used by businesses starting with raw data generated by businesses as an overview of their internal activity. Business intelligence has a quantitative focus. Business intelligence differs from competitive intelligence, which mainly analyses information from external data sources and where a qualitative focus prevails by means of utilisation of ideas.
The quantitative process employed in business intelligence usually requires software and specific techniques which aid in managing enormous databases, such as CRM (customer relationship management) systems, data warehouse, Big Data, OLAP (online analytical processing), data mining techniques, statistical data analysis and DSS (decision support systems). The purpose of business intelligence is to detect behavioural patterns from which future behaviour can be anticipated. This enables new opportunities to be developed and facilitates an organisation's decision making process.
An example of business intelligence in use
Analysis of the behaviour of customers on a website that sells books can inform the vendor. The company can gain business intelligence on transactions realised, the types of products browsed, the dates on which searches are performed, the route taken through the website and even the amount of time that customers spends on each stage. The vendor can then take informed decisions on what it should do regarding its sales policy, what products to highlight, how to energise those products ti wishes to eliminate from stock and what factors are needed to create customer loyalty.