If you have been on the internet at any point in the last few years, you will have heard of ‘business intelligence and ‘data analytics. These terms are used to describe two of the most powerful tools being used in the modern world. They have revolutionized the way decisions are made, which has paved the way for them to improve the quality of life that we have thanks to data-driven decisions. Business intelligence and data analytics are often considered the same thing but in reality, they are not. There are key similarities between the two but they are not the same thing.
In a world dominated by technology, the Internet of things, 5G, and artificial intelligence, there has never been more data being generated. With all of this data being generated, there needs to be someone who makes sense of it and there needs to be someone who uses it properly. Using the many tools that are available in 2022, organizations can plan, process, and forecast their trajectory better than ever before. In order to maintain competence, it is important to stay with the times and one of the most important tools for this is business intelligence and data analytics.
Before we compare the two, it is important that you first understand how the two are different. While this is an effort to show how the two are different, there will be multiple instances when it will seem that the two are overlapping with each other.
In the simplest of words, business intelligence is defined as a collection of processes, methodologies, technologies, and architectures that are used to convert raw and unfiltered data into meaningful data. This meaningful data is used to formulate and implement more informed, strategic, and tactical methods when it comes to decision-making. Business intelligence consists of the technology, strategy, and components used to collect and deploy business insights plus an explanation of the insights themselves. When talking about business intelligence, we must understand whether we are addressing the processes or the insights being generated as a result of them.
Among the many tools that are used in business intelligence, a few are:
- Dashboard development
- Dashboard reporting
- Real-time data monitoring
- Data mining
- Text mining
- BI software implementation
As an organization, you need to ensure that your processes and insights are streamlined and transparent. It is important to have a definitive system in place that allows you to make informed decisions by leveraging real-time data being generated. Each effort made with big data will directly or indirectly contribute toward profit maximization. For example, a printing press knows that the holidays are a time when cards are in higher demand. A toy company knows that Christmas is one of the hottest times to sell. EV manufacturers know that the governments are phasing out ICE cars so they are ramping up R&D.
Every business wants to ensure that there are no hiccups in its operations. They want smooth sailing and as much profit as possible. Using data from the real world is the best way for them to be able to do this.
If we were to define data analytics in the simplest of ways, it would be the process of refining raw data into a readable, presentable form. This includes collecting it, organizing it, making sense of it, extracting insights from it, and presenting it. While this may sound a lot like business intelligence, it is not. They are interdependent but also independent.
Business intelligence talks about processes and tools, data analytics is taking the data and making sense of it. Data analytics is considered the process of taking raw data and making it readable, business intelligence is considered the knowledge and insight that are derived from it. For example, if we want to study the number of people that watch their favorite movies and TV shows on streaming services, we will extract that information to begin working on it.
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Key Differences Between BI and Data Analytics
Let us help make sense of the difference between BI and data analytics.
The purpose of business intelligence is to make decisions using insights and information. These insights are generated and presented using data analytics processes.
The purpose of data analytics is to take raw data, clean it, organize it, and present it. This final data is considered an insight that has a variety of uses, one of which is business intelligence.
Business intelligence uses the different insights that are generated and uses this to make future strategies. Essentially, you are planning for the future by learning from the past.
Data analytics uses the different data at its disposal to identify patterns, study behaviors, map the findings, and use that to forecast for the future.
In business intelligence, you are getting the final, processed data. This data has been cleaned, organized, stored, and presented in the form of reports and dashboards.
Data analytics takes raw and unfiltered data and makes sense of it. This could be previously structured data or new raw data that has come in from the field. Either way, data analytics will get its hands dirty so business intelligence can make use of it.
Business intelligence is used by nontechnical personnel and the leadership. These are the people in charge of making the decisions for an organization. They might not know what the raw data means but reports and dashboards will allow them to use the data generated to make informed decisions for the future.
Data analytics is used by data scientists, data analysts, programmers, and computer engineers to sift through raw data and create insights from it. They are tasked with all the nitty and gritty work which results in dashboards and reports.
Business intelligence and data analytics are two of the most important fields in the world today. They are responsible for creating insights based on facts, figures, and raw data being generated in real-time. This allows them to identify trends, understand the consumer, and proceed accordingly. Ultimately, all businesses want to make a profit unless they are a charity. To ensure that businesses continue to make money, they need to have the right information to work with. The differences between the two are not black and white because they are constantly evolving.
The process of utilizing business intelligence is made possible by using the effort made by data analytics. The two are not the same thing but they depend on each other to operate. If business intelligence is to work properly, it requires data analytics to take the data it gets and make sense of it. For an organization, business intelligence and data analytics are two of the most important tools that it can use to plot its future. In 2022, the entire world is using these tools to create streamlined, sustainable, consistent, and informed strides in the right direction.