lecture 1 - walailak universitymit.wu.ac.th/mit/images/editor/files/l1 - business...
TRANSCRIPT
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Lecture 1 Overview of Business Intelligence
ITM-761
Business Intelligence
ดร. สลลิ บญุพราหมณ์ 1
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เรานีเ้กดิมาแลว้ชาตหินึง่ ควรคํานงึถงึชาตศิาสนา
ไมย่อมใหเ้สยีททีีเ่กดิมา ในหมูป่ระชาชาวไทย
แมน้ใครตัง้จติคดิรักตวั จะมัวนอนนิง่อยูไ่ฉน
ควรจะรอ้นอกรอ้นใจ เพือ่ใหพ้ร่ังพรอ้มทั่วตน
ชาตใิดไรรั้กสมคัรสมาน จะทําการสิง่ใดก็ไรผ้ล
แมน้ชาตยิอ่ยยบัอบัจน บคุคลจะสขุอยูอ่ยา่งไร
บทพระราชนพินธใ์นรัชกาลที ่ ๖ 2
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What is business intelligence
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http://www.webopedia.com
• the tools and systems that play a key role in the strategic
planning process of the corporation.
• These systems allow a company to gather, store, access and
analyze corporate data to aid in decision-making.
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• Generally these systems will illustrate BI in the areas of
• customer profiling,
• customer support,
• market research,
• market segmentation,
• product profitability,
• statistical analysis, and
• inventory and distribution analysis 5
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• Most companies collect a large amount of data from
their business operations. To keep track of that
information, a business and would need to use a wide
range of software programs , such as Excel, Access and
different database applications for various departments
throughout their organization.
• Using multiple software programs makes it difficult to
retrieve information in a timely manner and to perform
analysis of the data. 6
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http://www.imd.co.th/knowledges.php?id=1
• เทคโนโลยสํีาหรับการรวบรวมขอ้มลู จัดเก็บ วเิคราะห ์และ
การเขา้ถงึขอ้มลู รวมถงึการดใูนหลากหลายมมุมอง
(Multidimensional Model) ของแตห่น่วยงาน ซึง่ชว่ยให ้
ผูใ้ชง้านในองคก์รทําการตดัสนิใจทางธรุกจิทีด่ยี ิง่ขึน้
• BI Application จะรวบรวมการทํางานของระบบสนับสนุน
การตดัสนิใจ แบบสอบถามและสรา้งรายงานเพือ่การ
วเิคราะห ์
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http://www.techopedia.com
• Business intelligence (BI) is the use of computing technologies
for the identification, discovery and analysis of business data -
like sales revenue, products, costs and incomes.
• BI technologies provide current, historical and predictive views
of internally structured data for products and departments by
establishing more effective decision-making and strategic
operational insights through functions like online analytical
processing (OLAP), reporting, predictive analytics, data/text
mining, benchmarking and Business Performance
Management (BPM). These technologies and functions are
often referred to as information management.
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(Rud, Olivia (2009). Business Intelligence Success Factors: Tools for Aligning Your Business in the Global Economy. Hoboken, N.J: Wiley & Sons
• Business intelligence (BI) is a set of theories,
methodologies, architectures, and technologies that
transform raw data into meaningful and useful
information for business purposes.
• BI can handle large amounts of unstructured data to help
identify and develop new opportunities. Making use of
new opportunities and implementing an effective
strategy can provide a competitive market advantage and
long-term stability. 9
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http://www.gartner.com
• Business intelligence (BI) is an umbrella term that
includes the applications, infrastructure and tools, and
best practices that enable access to and analysis of
information to improve and optimize decisions and
performance.
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http://www.businessdictionary.com
• Computer-based techniques used in spotting, digging-
out, and analyzing 'hard' business data, such as sales
revenue by products or departments or associated costs
and incomes.
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• Objectives of a BI exercise include
(1) understanding of a firm's internal and external
strengths and weaknesses,
(2) understanding of the relationship between different
data for better decision making,
(3) detection of opportunities for innovation, and
(4) cost reduction and optimal deployment of resources.
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Cindi Howson. (2008). Successful Business Intelligence: Secrets to Making BI a Killer App. McGraw-Hill
• a set of technologies and processes that allow people at
all levels of an organization to access and analyze data.
• Without people to interpret the information and act on
it, business intelligence achieves nothing
• Business intelligence allows people at all levels of an
organization to access, interact with, and analyze data to
manage the business, improve performance, discover
opportunities, and operate efficiently. 13
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BI =
• “competitive intelligence.”
• To another person, “reporting” may be a better term,
even though business intelligence goes well beyond
accessing a static report.
• “Reporting” and “analysis” are terms frequently used to
describe business intelligence.
• Others will use terms such as “business analytics” or
“decision support,” 14
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How BI provide business value
• BI cuts across all functions and all industries
• BI touches everyone in a company and beyond to customers
and suppliers
• business intelligence can only provide business value when it
is used effectively by people
• There is a correlation between the effective use of business
intelligence and company performance
• However, having better access to data does not affect
company performance; the difference is in what companies do
with the data
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BI for Management and Control • know what’s going on in the business
• information is accessible on a more timely and flexible basis to provide a view of
• How sales are tracking in various regions and by various product lines
• If expenses are on plan or running over budget
• If warehouse capacities are at optimal levels
• If sales pipelines are where they should be
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BI for Improving Business Performance
• Business performance is measured by a
number of financial indicators such as
revenue, margin, profitability, cost to
serve, and so on
• performance gains may be achieved by
improving response rates for particular
campaigns by identifying characteristics
of more responsive customers
• Allows companies to boost revenues by
cross-selling products to existing
customers
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• Accounting personnel may use
BI to reduce the aging of
accounts receivable by
identifying late-paying
customers
• In manufacturing, BI facilitates
gap analysis to understand
why certain plants operate
more efficiently than others 18
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Operational BI
• While early business intelligence
deployments focused more on
strategic decisions and performance,
BI increasingly plays a critical role in
the daily operations of a company
• In this regard, accessing detailed
data and reviewing information may
be necessary to complete a task
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Examples of operational BI
• as part of accepting a new order, a customer service
representative may first check available inventory.
• Such an inventory report may be a standard report
developed within an order entry system or it may come
from a BI solution, whether stand alone or embedded in
the order entry application
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• Travel agents and airlines use operational BI to monitor
flight delays so they can proactively re-accommodate
passengers with connections
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• Hospitals and emergency rooms will
use business intelligence to
determine optimum staffing levels
during peak periods
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• Restaurants will use BI to estimate
the wait time for a table based on
the number of current patrons and
average length to dine
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• Walt Disney World’s Magic Kingdom uses business intelligence for its service that issues park visitors FastPass tickets to avoid standing in long lines for rides.
• The business intelligence tools monitor waiting times at the most popular rides to balance the number of tickets issued in given periods throughout the day.
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• Operational business intelligence most differs from BI for
management and control purposes in both the level of
detail required and in the timeliness of the data.
• Operational BI may involve accessing a transaction system
directly or through a data warehouse that is updated in
near real-time multiple times throughout the day
• BI for management and control purposes may also be in
near real time but can also be based on weekly or monthly
data 25
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BI for process improvement
• BI may support the decisions individuals make in every
step of a process
• It also may be used to help streamline a process by
measuring how long subprocesses take and identifying
areas for improvement
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Examples for process improvement
• manufacturing-to-shipment is one process.
• In the absence of BI, a company may only realize there is
a problem when a customer complains
• By analyzing the inputs, the time, and the outputs for
each step of the process, BI can help identify the process
bottlenecks
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Examples for process improvement
• At an oil and gas company, cash flow was problematic. A
review of the process showed that gas was being
delivered to customers on time but an invoice was only
sent a week later.
• Reducing the time in the delivery-to-invoice process
helped the company solve cash-flow problems.
• BI tools allowed the company to identify the problem
and then to ensure compliance to a new rule of invoicing
within one day of delivery 28
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BI to improve customer service
• Business intelligence can help companies provide high
customer service levels by providing timely order
processing, loan approvals, problem handling, and so on.
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Examples of Customer Service
• Whirlpool uses business intelligence to monitor its
warranty program to understand root causes for
warranty problems and improve customer satisfaction
with its products
• Continental Airlines uses business intelligence to monitor
how full business class cabins are and to ensure its most
valued customers receive complimentary upgrades when
space permits 30
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BI to Make the World Better
• Police departments have used BI to help police officers
respond better to call-outs and to reduce crime rates
• School systems use BI to understand the effects and
trends in student grades based on gender, attendance
rates, and teaching methods
• Emergency Medical Associates (EMA) uses BI to analyze
patient trends in New York and New Jersey to better
predict and prepare for disease outbreaks and to
improve emergency room care in area hospitals 31
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BI for Discovering New Business Opportunities
• helps businesses assess and uncover new business
opportunities by exploring data and testing theories
• The Chemical Company uses business intelligence to
understand the value proposition of pursuing joint
ventures.
• A hospitality company uses business intelligence to
explore hotel capacity rates as a way of developing the
time-share business 32
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Technology changes enabling BI • Rapid change in technology has been one driver of this
frenetic pace of business change; it also has enabled
business intelligence for everyone, not just information
technology experts, programmers, and power users
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Battle Scars
• Business intelligence is a catalyst for change
• Power struggles between IT and the business when
either loses areas of control or disagrees on the scope
and approach
• Jobs eliminated when custom report developers were no
longer needed
• A marketing manager fired when a company realized just
how badly the manager was performing campaign
management 36
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Successful BI case studies
• Survey demographics by world region
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• Relationship Between Successful BI Deployment and
Contribution toCompany Performance
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• BI success is measured more by a perception of improved
business performance and qualitative measures than by
quantitative measures
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