What are business intelligence (BI) tools?

Business intelligence tools are the tools used for analyzing, retrieving, sorting, and filtering information from different business intelligence systems. They are used for creating reports, visualizing large volumes of data, and decision-making.

Business intelligence techniques

Business intelligence techniques are approaches that companies use for making business decisions in the company. Companies use various BI techniques which are discussed below:

Analytics

The analytics technique analyzes data. This technique help companies collect meaningful trends that help in profitable decision-making. This method helps businesses make valuable data-driven decisions by understanding the information they collect.

Predictive modeling

Predictive modeling, as the name suggests, is a BI technique used to predict trends. It uses statistical methodologies to develop models that forecast possibilities and trends.

Online analytical processing (OLAP)

The OLAP techniques let users analyze data from numerous data sources. Business users use this business intelligence solution to learn about problems and analyze them from multiple perspectives. This method is used in budgeting and financial forecasting.

Data mining

Data mining is a BI technique used to identify a pattern in a given dataset. It uses several resources such as database systems, machine learning tools, and statistics to identify the patterns. It is used in data pre-processing and management.

Model visualization

This strategy converts data and factual information into charts, plots, graphs, and other graphics for easier interpretation.

Applications of business intelligence

Business intelligence tools and techniques have several following applications.

• Analysis: BI tools help analyze raw data for identifying trends or similar functionalities.
• Reports: Business intelligence tools provide numerous functionalities for creating understandable reports. They let business users create, modify, or view the report online or offline.
• Real-time monitoring: Business intelligence software applications help in real-time monitoring of data ensuring that companies can take valuable and informed decisions instantly.
• Dashboards: BI tools offer dashboards that assist in monitoring and measuring the performance of the business.
• Scorecards: Business analytics tools provide scorecards indicating the company’s key performance indicators (KPIs).
• Collaborative business intelligence: With BI tools, companies can share information with colleagues and other stakeholders.
• Mobile business intelligence: Due to advancements in technology, BI tools now let users access all necessary information like reports, monitoring, and scorecards, using mobile phones.

Types of business intelligence analytics tools

Business analytics tools have a large number of applications. Therefore, various types of business intelligence tools are used by companies. The popular types of BI tools used are as follows:

Spreadsheet

A spreadsheet is a software application used to store, modify, and analyze data. The data in a spreadsheet is stored in rows and columns. This data can be retrieved, filtered, sorted, and deleted. Microsoft Excel is the most commonly used spreadsheet. However, various other open-source web-based spreadsheets such as Google spreadsheets are also used for business analytics.

Digital dashboards

Digital dashboards are BI tools that allow businesses to monitor, analyze, and report the key performance indicators and other metrics. These business intelligence solutions curate data from numerous sources and represent them in an easy-to-understand manner so that companies can explore and analyze the data at-a-glance.

Data visualization software

Data visualization software is a business intelligence software representing a given dataset visually. Data can be visually represented using charts, graphs, histograms, maps, and infographics. Owners can easily interpret data by representing the datasets in a graphical format using data visualization software.

OLAP tools

Businesses use OLAP tools to analyze large volumes of data from multiple perspectives. Such business intelligence systems provide functionalities such as filtering, drilling, and visualizing data.

Corporate performance management (CPM) software

The senior management uses CPM software to analyze and review the company’s performance while achieving a pre-defined set of goals. Such software usually indicates the KPIs so that the management can easily track the performance of the employees and projects.

Self-service business intelligence software

Self-service BI software is software that allows business leaders to view and study data without using information technology. Using self-service software, individuals that do not come from a background in business intelligence can access and interpret data without involving the BI and information technology departments.

Data mining tools

Data mining tools help discover patterns or trends from a large number of data sets. These tools use various techniques like artificial intelligence, statistics, database systems, and machine learning to identify patterns.

Extract, transform, and load (ETL) software

ETL software is a BI software used for collecting data from multiple sources and consolidating the data into one centralized location. Such tools allow businesses to work with many types of data together.

Benefits of business intelligence analytics tools

The benefits of using BI tools in businesses are as follows:

• Small and large firms have to deal with data from numerous sources, making it difficult to study the data. BI tools curate information from several data sources and bring them together so that businesses can analyze the data faster and efficiently.
• BI tools assist in predictive analysis, allowing business owners to forecast future activities and use the predictions to drive more profit.
• Most BI tools are automated, reducing manual task load and working faster than humans.
• BI tools and techniques reduce the business cost and help in faster planning.
• Most BI tools are offered as a Software-as-a-Service (SaaS) model, which means they work 24x7 throughout the year.
• BI platforms are also accessible online so that end-users can access and monitor data anywhere, anytime.
• BI systems are often integrated with mobile devices allowing business owners to view data and reports remotely.

Context and Applications

The topic, business intelligence analytics tools and techniques, is covered in information systems and business intelligence subjects in the following courses:

• Bachelors in Computer Science
• Masters in Computer Science
• Bachelors in Information Technology
• Masters in Information Technology

Practice Problems

Q1. Which of the following BI tools is used to represent data visually?

1. Data visualization software
2. Drag-and-drop software
3. OLAP data analysis tools
4. Drill-down software

Answer: Option a

Explanation: Data visualization BI tools are used by business owners to visually represent data in the form of graphs, charts, and maps.

Q2. Which of the following BI tools is used to analyze data from different perspectives?

1. In-memory data analysis software
2. OLAP tools
3. In-chip data analytics software
4. Best-in-class BI systems

Answer: Option b

Explanation: OLAP tools are used for analyzing large amounts of data from multiple perspectives.

Q3. Which of the following is an application of BI tools and techniques?

1. End-to-end predictive analytics
2. Role-based analysis
3. All-in-one Data analytics
4. Real-time monitoring

Answer: Option d

Explanation: One of the BI tools and techniques applications is the real-time monitoring of data.

Q4. Which of the following is a benefit of BI tools and techniques?

1. They are automated.
2. They are not up-to-date.
3. They are not easy to use.
4. They cannot be used for predictive analytics.

Answer: Option a

Explanation: The benefit of using BI tools is that they are automated, so they reduce manual efforts.

Q5. Which of the following is not a BI tool?

1. Spreadsheet
2. Data mining tools
3. ETL software
4. Cloud-based data warehouse software

Answer: Option d

Explanation: Spreadsheet, data mining tools, and ETL software are all types of BI tools, except cloud-based data warehouse software.

Common Mistakes

Business intelligence tools and business intelligence techniques are two different concepts. The techniques are used by businesses to make data-driven business decisions, whereas tools are the software used by businesses to study and access data. Students should understand this difference.

Related Concepts

• Data warehouse
• Data mining
• Data modeling
• Software-as-a-Service business intelligence
• White-labeled software
• Big data analytics