Intro To BI

Introduction to
Business Intelligence
Genap 2015/2016
Objectives
• Understand today's turbulent business
environment and describe how organizations
survive and even excel in such an
environment (solving problems and
exploiting opportunities)
• Describe the business intelligence (BI)
methodology, history, components,
architecture, and benefit.
• Describe the development of BI system
Introduction
• Low cost data storage and wide availability of internet
made it easier to access large amount of data.
• Such data are often heterogeneous in origin, content, &
representation
• Financial and administrative transactions, web navigation
paths, emails, texts, hypertexts, spatial, image, etc
• Is it possible to convert such data to information &
knowledge that can be used to aid and improve
enterprise governance?
• Is it possible to use such data to help making quality
decision?
• Since ability to make decisions is one of the primary factors that
influence performance and competitive strength of
organization.
Introduction (cont’d)
• Most knowledge workers reach decisions primarily using
intuitive method which take into account elements such
as experience, knowledge of the domain & available
information
• But it’s not appropriate for unstable, frequent and rapid
change environment
• The business environment is becoming more and more
complex. This creates opportunities on the one hand
and problems on the other.
• Organizations use different actions to counter the
pressures of today’s business environment
• Many of these actions require some computerized
support.
Business Pressures–Responses–Support Model
Business Environment Factors
Markets Strong competition
Expanding global markets
Blooming electronic markets on the Internet
Innovative marketing methods
Opportunities for outsourcing with IT support
Need for real-time, on-demand transactions
Consumer Demand
Desire for customization
Desire for quality, diversity of products, and speed of
delivery
Customers getting powerful and less loyal
Business Environment Factors (cont’d)
Technology More innovations, new products, and new services
Increasing obsolescence rate
Increasing information overload
Social networking, Web 2.0 and beyond
Societal Growing government regulations and deregulation

Workforce more diversified, older, and composed of
more women
Prime concerns of homeland security and terrorist
attacks
Increasing social responsibility of companies
Greater emphasis on sustainability
Case Study 1: Retention in Mobile Industry
• Marketing manager realizes of mobile phone
company realizes that many customers are
discontinuing their service (move to the competitor)
 Low customer loyalty
• Due to limited budget, he can only choose to
pursue 2000 individuals out of 2 million people.
• How to choose customer to be contacted?
• He has to choose the highest churn likelihood
among high value customer
• Advanced mathematical model and data mining are
needed.
Case Study 2: Logistics Planning
• Logistic Manager of manufacturing company

wishes to develop medium term logistic
production plan.
• High complexity decision making : allocation of
demand, procurement of raw material, purchase
parts from suppliers, production planning,
distribution.
• Entail tens facilities, hundreds suppliers,
thousands of goods over one year divided by
weeks
• Advanced optimization model is needed
Business Intelligence is a(n):
• set of mathematical models and analysis
methodologies that exploit the available
data to generate information and
knowledge useful for complex decision
making processes ---[Vercelis09]
• umbrella term that combines
architectures, tools, databases, analytical
tools, applications, and methodologies
--[Turban11]
A Brief History of BI
The term BI was coined by the Gartner Group

in the mid-1990s
However, the concept is much older
– 1970s - MIS reporting - static/periodic reports
– 1980s - Executive Information Systems (EIS)
– 1990s - OLAP, dynamic, multidimensional, ad-hoc
reporting -> coining of the term “BI”
– 2005+ Inclusion of AI and Data/Text Mining
capabilities; Web-based Portals/Dashboards
– 2010s - yet to be seen
Purpose:
• To provide knowledge workers with tools
and methodologies that allow them to
make effective and timely decisions
• To enable easy access to data (and
models) to provide business managers
with the ability to conduct analysis
Business Intelligence (Cont’d)
BI helps transform:
Data  information (& knowledge) decisions 
action
Aggregate Present Enrich Inform a
Data Data Data Decision
Database, Reporting Add Context to Decisions are

Data Mart, Tools, Create Fact-based
Data Dashboards, Information, and Data-
Warehouse, Static Reports, Descriptive
driven
ETL Tools, Mobile Statistics,
Integration Reporting, Benchmarks,
Tools OLAP Cubes Variance to
Plan or LY
Without BI
With BI
How Important is BI?
Top 10 Business and Technology Priorities for 2011:
1. Cloud computing
2. Virtualization
3. Mobile technologies
4. IT Management
5. Business Intelligence
6. Networking, voice and data communications
7. Enterprise applications
8. Collaboration technologies
9. Infrastructure
10. Web 2.0
Source: Gartner’s 2011 CIO Agenda (aka “Reimagining IT: The 2011 CIO Agenda”
How Important is BI? (cont’d)
The July 2010 Forrester report “Technology
Trends That Retail CIOs Must Tap to Drive
Growth” identified the following technologies
that retail CIOs should be considering as part of
an overall architecture strategy:
Mobile Social Computing

Supply Chain
Cloud
Micropayments
Business Intelligence/Analytics
The Benefits of BI
The ability to provide accurate information when

needed, including a real-time view of the corporate
performance and its parts
A survey by Thompson (2004):

• Faster, more accurate reporting (81%)
• Improved decision making (78%)
• Improved customer service (56%)
• Increased revenue (49%)
The Evolution of BI Capabilities
BI Today vs Tomorrow
“BI today is like reading the newspaper”
– BI reporting tool on top of a data warehouse

that loads nightly and produces historical
reporting
BI tomorrow will focus more on real-time

events and predicting tomorrow’s
headlines
The Architecture of BI
A BI system has four major components
• A data warehouse, with its source data
• Business analytics, a collection of tools for
manipulating, mining, and analyzing the data in
the data warehouse;
• Business performance management (BPM) for
monitoring and analyzing performance
• A user interface (e.g., dashboard)
--[Turban11]
A High-Level Architecture of BI
Components in a BI Architecture
• The data warehouse is a large repository of well-

organized historical data
• Business analytics are the tools that allow
transformation of data into information and
knowledge
• Business performance management (BPM)
allows monitoring, measuring, and comparing
key performance indicators
• User interface (e.g., dashboards) allows access
and easy manipulation of other BI components
--[Turban11]
Components in a BI Architecture (cont’d)
• Data sources. Heterogeneous in type and origin.

Most data belongs to operational systems, but may
also include unstructured docs (emails)
•Data warehouses & data marts. Using ETL tools,
data originating from different sources are stored in
databases to support BI
•BI methodologies. Data are extracted and used to
feed mathematical and analysis models to support
decision makers.
---[Vercelis09]
Decision Maker
Active
Analyst and
Passive Expert
DB Admin
TDWI Executive
Major Summit – August 2010
BI Trends
TDWI Executive Summit – August 2010:
What BI technologies will be the most important
to your organization in the next 3 years?
1. Predictive Analytics
2. Visualization/Dashboards
3. Master Data Management
4. The Cloud
5. Analytic Databases
6. Mobile BI
7. Open Source
8. Text Analytics
Development of Business
Intelligence System
• Interview
• Objective, priorities
• Cost & benefit
• Architecture
• Decision making process
• Phases, priorities,
execution time, cost,
roles, resources
• Detailed functions
• Acquiring data
• Defining Models
• prototyping
Questions / Comments…
End of the
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Intro To BI

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Intro To BI

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Introduction to

Societal Growing government regulations and deregulation

• Logistic Manager of manufacturing company

The term BI was coined by the Gartner Group

Database, Reporting Add Context to Decisions are

Mobile Social Computing

The ability to provide accurate information when

A survey by Thompson (2004):

– BI reporting tool on top of a data warehouse

BI tomorrow will focus more on real-time

• The data warehouse is a large repository of well-

• Data sources. Heterogeneous in type and origin.

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