THOUGHTS

Business Intelligence Vs. Business Analytics – Similarities and Differences

Mar 22, 2018

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Today, the business world has become fiercely competitive, and decision-makers can’t rely on gut feelings anymore to create long-term strategies. So a lot of high-level words are thrown around in the boardroom discussions. Such terminologies emphasize the use of data-driven decision-making. However, the terms business analytics and business intelligence are often used interchangeably. But, there is a stark difference between the two. Although many tools used in both disciplines are similar to each other, there’s a fundamental difference between them.

Business analytics

The recent explosion of data available to the business world has posed some serious problems to decision-makers. Firstly, how do they process and make sense of such vast amounts of data? Furthermore, how do they find a correlation between multiple variables and successfully predict the outcome by observing the change in one variable? Solving such problems can provide business executives with useful insights that can help in business planning and boost future performance.

Businesses can use statistical tools, models, and predictive modeling to uncover market trends and figure out why things are happening. Additionally, based on the massive amount of data available, certain tools can also accurately predict what might happen in the future based on historical events.

Popular business analytics solutions: SAP Analytics Suite, Birst BI, Tableau Big Data Analytics, and Pentaho BA.

Business intelligence

Business intelligence makes use of an organization’s own data to assess business performance. The ultimate goal of business intelligence is to understand the business performance in-depth and make informed business decisions by eliminating guesswork.

Business intelligence also covers unstructured data sets such as customer feedback, salesperson suggestions, marketing materials, video files, memos, and company reports. As a whole, business intelligence is concerned with the whats, whens, whys, and hows. By analyzing such unstructured and semi-structured databases, companies can monitor their performance and apply predictive and prescriptive analytics as well.

Popular business intelligence solutions: SAP, IBM Microstrategy, and QlikView.

Is business intelligence the subset of business analytics?

Numerous proponents argue that business intelligence is merely a small part of business analytics. Business analytics is the go-to tool that encompasses information management, data warehousing, and predictive analytics. The argument favors analytics as business intelligence is just a descriptive part of data analysis.

Is business analytics the subset of business intelligence?

However, some argue that business intelligence is merely a user-facing, self-service end of BI. The dashboards and displays are customized to each business’s tailored requirements. Additionally, many ERP packages allow employees to store, retrieve, and analyze available information to generate their own dashboards to assess business performance.

Business analytics vs. business intelligence

Although there may be a lot of similarities between them, business intelligence uses past data to optimize the current or future operations, whereas business analytics analyzes the past and makes a prediction for the future. Despite their differences, the fact is not if one is superior to the other, rather what the business needs. Companies looking to improve operations and increase efficiency may be well-served by business intelligence tools. On the other hand, if the business processes or model requires a significant overhaul business analytics should be the go-to tool. Also, companies working on extensive data sets and need data warehousing and intuitive reporting must use business intelligence tools.

For more information on the differences, top business analytics tools, and best business intelligence tools:

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