Business intelligence (BI) refers to skills, technologies, applications and practices used to help a business (or stakeholders) acquire a better understanding of its commercial context. Business intelligence may also refer to the collected information itself.
Business intelligence applications provide historical, current, and predictive views of business operations. Common functions of business intelligence applications are reporting, OLAP, analytics, data mining, business performance management, benchmarks, text mining, and predictive analytics.
Business intelligence often aims to support better business decision-making. Thus a BI system can be called a decision support system (DSS).
In a 1958 article, IBM researcher Hans Peter Luhn used the term business intelligence. He defined intelligence as: "the ability to apprehend the interrelationships of presented facts in such a way as to guide action towards a desired goal."
In 1989 Howard Dresner (later a Gartner Group analyst) proposed BI as an umbrella term to describe "concepts and methods to improve business decision making by using fact-based support systems." It was not until the late 1990s that this usage was widespread.
Often BI applications use data gathered from a data warehouse or a data mart. However, not all data warehouses are used for business intelligence nor do all business intelligence applications require a data warehouse.
The term business intelligence is often used as a synonym for competitive intelligence. A broad definition of Competitive Intelligence is the action of gathering, analyzing, and applying information about products, domain constituents, customers, and competitors for the short term and long term planning needs of an organization. Competitive Intelligence (CI) is both a process and a product. The process of collecting, storing and analyzing information about the competitive arena results in the actionable output of intelligence ascertained by the needs prescribed by an organization.
A more focused definition of CI regards it as the organizational function responsible for the early identification of risks and opportunities in the market before they become obvious. This definition focuses attention on the difference between dissemination of widely available factual information (such as market statistics, financial reports, newspaper clippings) performed by functions such as libraries and information centers, and competitive intelligence which is a perspective on developments and events aimed at yielding a competitive edge.
The term CI is often viewed as synonymous with Competitor analysis but Competitive Intelligence is more than analyzing competitors, it is about making the organization more competitive relative to its existing set of competitors and potential competitors. Customers and key external stakeholders define the set of competitors for the organization and, in so doing, describe what could be a substitute for the business, votes, donations or other activities of the organization. The term is often abbreviated as CI, and most large businesses now have some Competitive Intelligences functions with staff involved often being members of professional associations such as the Society of Competitive Intelligence Professionals.
The Society of Competitive Intelligence Professionals (SCIP) is an organization for those who are interested in learning more about Competitive Intelligence. Established in 1986, it provides education and networking opportunities for business professionals, and provide up to date market research and analysis. Members of the SCIP have backgrounds in market research, strategic analysis, science and technology.
A 2009 Gartner Group paper predicted these developments in business intelligence market:
Business Intelligence is the process of gathering meaningful information at any time to answer questions and identify significant trends or patterns, giving key stakeholders the ability to make better decisions.
Knowing exactly all the ins and outs of a company is a primary need for a successful business, and therefore getting the right data to the right person at the right time is essential.