Business intelligence (BI) is the set of techniques and tools for the transformation of raw data into meaningful and useful information for business analysis purposes. BI technologies are capable of handling large amounts of unstructured data to help identify, develop and otherwise create new strategic business opportunities. The goal of BI is to allow for the easy interpretation of these large volumes of data. Identifying new opportunities and implementing an effective strategy based on insights can provide businesses with a competitive market advantage and long-term stability.
BI can be used to support a wide range of business decisions ranging from operational to strategic. Basic operating decisions include product positioning or pricing. Strategic business decisions include priorities, goals and directions at the broadest level. In all cases, BI is most effective when it combines data derived from the market in which a company operates (external data) with data from company sources internal to the business such as financial and operations data (internal data). When combined, external and internal data can provide a more complete picture which, in effect, creates an “intelligence” that cannot be derived by any singular set of data.
The terms business intelligence and business analytics (BA) are often used interchangeably, however, there are key differences. For example, a business question is posed. BI may answer the question with these questions:
- What happened?
- How many?
BA when asked the same question, may answer with these:
- Why did it happen?
- Will it happen again?
- What will happen if we change ‘x’?
- What else does the data tell us that we never thought to ask?
Many universities offer bachelor’s degree programs in Business Intelligence and Analytics Management. Theirs is a typical degree program encompassing this partial list of courses:
- Applied Business Analytics
- Database Concepts in BI
- Internet Analytics
- Operations Strategy and Analysis
- Managerial Applications of Business Analytics
There are online and campus programs at the graduate level. The former is offered by Boston University (BU) which, according to a 2014 US News and World report, has the second best graduate Computer Information Technology Programs. This school has a Master of Science in Computer Information Systems with a concentration in Database Management and Business Intelligence.
A sampling of courses at the graduate level involve:
- Financial Decision Making
- Data Warehousing and Business Intelligence
- Multivariate Data Analytics
- Algorithmic Trading Strategies
- Social Network Analytics
There will be a shortage of talent necessary for organizations to take advantage of big data. By 2018, the United States alone could face a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts with the know-how to use the analysis of big data to make effective decisions. – McKinsey Global Institute. (McKinsey & Company is a global management consulting firm.)
The US Bureau of Labor Statistics (BLS) has one category for “Management Analysts”. The BLS reported in 2012 that the median annual salary was $78,600 or $37.79 per hour. The projected job growth/change is 19% between 2012 and 2022. The BLS opines that growth will be particularly strong in smaller consulting companies that specialize in specific industries or types of business function, such as information technology or human resources. Government agencies will also seek the services of management analysts as they look for ways to reduce spending and improve efficiency.