What Is A Business Intelligence System? Pros and Cons For Users

Introduction to Business Intelligence

Many of today's organizations are investing in business intelligence systems to help make sense of the data they generate daily. As reported in 2019, more than 46% of small businesses utilize business intelligence tools for their organizational strategies.

With these solutions, companies can streamline the process of collecting, storing, and analyzing complex information, effectively enabling them to attain a detailed view of their internal and external operations.

What is Business Intelligence?

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Business intelligence, also known as BI, is the process of combining data gathering, analytics, and storage to highlight actionable insights. Generally, it involves collecting data from a business's IT systems and various external sources, such as the stock market. Then, the organization will analyze the data sets, run queries, and create data visualizations and reports. This makes the information accessible and easy to understand for the team.

A business intelligence strategy is important for organizations because it allows them to make informed and strategic decisions. It helps them leverage their use of data in a way that boosts their competitive edge and enhances operational efficiency. According to a study from Microstrategy, 56% of users said BI enabled them to make effective decisions faster. While 51% said using business intelligence tools led to improved financial performance.

Many big companies have also been adopting these tools. For example, the fast-casual chain Chipotle uses BI to have a more unified view of their operations. HelloFresh, a popular meal-kit brand, employs BI systems for their digital marketing strategy to increase sales conversions.

Examples of Business Intelligence

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Business intelligence encompasses various activities associated with collecting and analyzing data. The following are common processes of BI that help companies optimize their performance.

  • Data Mining - The use of machine learning, statistics, and databases to identify trends and relationships in datasets.
  • Querying - Requesting specific information or data from a database.
  • Benchmarking and Performance Metric Analysis - The act of comparing data regarding current processes and performance to historical metrics to track progress towards goals.
  • Reporting - The sharing of data analyses to decision-makers and stakeholders so they can make informed strategies.
  • Descriptive Analytics - The use of preliminary data analysis to determine what happened within the business.
  • Statistical Analysis - Utilizing the conclusions from descriptive analyses and employing statistics to understand the reason behind a trend.
  • Data Visualization - Translating data analysis into a visual format, like a chart, graph, or histogram to make information comprehensible and straightforward.
  • Data Preparation - The act of consolidating disparate data sources and pinpointing measurements to prepare them for analysis.

Pros and Cons of BI Systems

Depending on a business, its size, and operations, business intelligence systems can provide various advantages and disadvantages.


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The following are the benefits of a BI system.

  • Increases Productivity
Small businesses and enterprises can easily create reports using an online business intelligence tool. This can save companies time, labor, and resources. Additionally, since employees will not have to spend their shift manually managing data, they can allocate their focus towards more productive tasks.

  • Maximizes Visibility
Business intelligence enables organizations to consume a large volume of data accessibly. This improves their visibility of all their processes and ensures any issues are quickly identified.

  • Assigns Accountability
Many systems will assign accountability within the business, ensuring that any actions to data sources can be traced to a team or individual.

  • Maintains a Broad Perspective
Business intelligence solutions often have features, such as reporting dashboards and scorecards. These tools allow stakeholders and executives to have a broad overview of their operations.

  • Simplifies Business Processes
These systems help streamline and automate business processes, such as predictive analytics and benchmarking. This saves organizations time and money and ensures these protocols are done correctly.

  • Eliminates Need for Specialists
BI tools are easy to use and intuitive, allowing non-technical users to perform analytics themselves. Therefore, this eliminates the need for analysts and IT specialists.


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The following are drawbacks to a business intelligence system.

  • Costly Implementation
Investing in business intelligence tools may be expensive for some organizations.

  • Complex Implementation
Business intelligence can be complex and may require specific teams to perform certain processes.

  • Time Consuming
Although BI tools can simplify various business processes, a data warehousing system can take up to a year and a half to be fully implemented.

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There are trends in business intelligence and analytics that many modern companies have been capitalizing on. The following are the most common trends.

  • Artificial Intelligence - Also known as AI, artificial intelligence and machine learning can complete complex tasks without human intervention. AI solutions can also produce real time data analysis and reports.
  • Embedded BI - Businesses can implement tools to integrate BI software or features into their existing systems. By embedding BI into its applications, the organization will enhance and maximize its data capabilities.
  • Collaborative BI - In conjunction with collaborative tools, such as social media, BI software can enhance teamwork and data sharing.

Business intelligence is a set of techniques and technologies that compile processes for data collection and analysis. By understanding its importance and its various drawbacks and advantages, organizations can be prepared to leverage their BI solutions.