February 25th, 2013
Seabeck Systems, LLC
Business Intelligence (BI) is a set of systems and processes that people can use to understand and adjust company performance.
These aren’t just a bunch of words. Let’s look closer:
When we talk about companies, we’re really talking about people.
Computers aren’t the decision makers. Smart automation cannot replace essential activities implemented by well-informed people. It is the people (not the technologies) at your company who can use information generated by BI to create actionable steps for managing company performance.
A system is a set of interrelated / interacting elements (processes) working toward a common objective.
For example: a payroll system consists of manual and automated processes (e.g. time tracking, tax reporting and payments) that work together to pay employees correctly on a consistent schedule.
A process is a set of interrelated / interacting functions (activities) that transform inputs (requirements) into outputs (actionable information).
For example: a monthly payroll process includes calculation activities to transform inputs (e.g. time cards, tax withholding allowances, deductions) into outputs (e.g. paychecks, direct deposits, and pay advice).
Now let’s return to our original question: What is BI?
Answer: Business Intelligence is a set of systems and processes designed to generate timely, accurate, relevant, and actionable information. People use BI information to understand and improve company performance.
See also: “Systems and Processes – Is there a Difference?” (PDF download) by David Hoyle. Chartered Quality Institute (2009).
Got more questions? Try the BI Basics index, or share your questions in the comments.