Both business intelligence and data analytics are very popular data tools that are used by a number of businesses to help understand and digest the vast amount of data that they have. This is because they are both hugely essential for the efficient running of a modern business.
While the two share a wide range of similarities, they are actually two different things. However, the similarities are what makes this topic very confusing to different businesses who are trying to determine the differences and which is best for them.
In this article, we will detail what exactly business intelligence, what data analytics are, and the pros & cons of both before deciding which we believe is the best data tool for your business.
What Is Business Intelligence?
Business intelligence is a phenomenal data software that allows businesses to combine predictive analytics, business analytics, data visualisation, data mining, data tools and data integration. This therefore allows businesses to make much more informed decisions surrounding business operations and efficiency. This gives you the unique ability to utilise raw data to improve areas of your business that may be suffering to improve performance and gain a competitive advantage over your competitors.
When using business intelligence tools, the overall goal is to drive much more effective business decision making which will help to reduce risks while also seeing amazing results. This kind of data analysis will allow businesses to improve the overall efficiency of the business in order to improve the overall performance of the business.
Pros Of Business Intelligence
Accurate Reporting - Business intelligence tools provide valuable information to businesses that can then be analysed and used to create extremely accurate reports on performance. These accurate reports can then be used by managers throughout the business to improve and streamline operations.
More Informed Decision Making - Because of the countless amounts of data that business intelligence can analyse and make more digestible, businesses can get more accurate predictions on how decisions will affect business. The data that business intelligence analyses will also allow businesses to make much more informed and accurate decisions.
Easily Digestible - Business intelligence makes data that would once be very difficult for businesses to understand much more digestible and easy to understand. Business intelligence tools show all of the data in clear dashboards and reports that are very easy for businesses and individuals to consume and digest when compared with other data tools.
Customer Satisfaction - Using business intelligence tools will help you to streamline and improve business operations. This will therefore allow you to offer your customers a much more pleasurable experience that will help to improve their overall customer satisfaction. The more satisfied a customer is, the more likely they are to recommend your business to others or return it to themselves.
Enhanced Productivity - This hugely intelligent data tool can analyse data much quicker than an individual. This can therefore allow you to address challenges instantly and streamline processes. This will therefore help to improve the overall efficiency and productivity within the business. It also allows teams to know what exactly they need to do in order to improve performance in their specific areas.
Improved Data Quality - A vast majority of business intelligence tools come with unique programs that help to identify and delete data that has been corrupted. These brilliant features can therefore help to improve the quality of the data which makes decision-making easier due to the highly accurate data.
Cons Of Business Intelligence
Costs - While the benefits it can offer a business are instant, the initial investment of a business intelligence tool can be very pricey. Because of this large initial investment, small businesses may not have the funds to be able to integrate business intelligence tools into their operations. This therefore means that it is only really a tool that can benefit bigger organisations.
Manipulation Of Data - Some BI software can manipulate data in a way that can misrepresent the truth. This would prove to be problematic when you are using the data to make very important decisions on business operations and future performance. Employees may give in to the temptation to make the data look more impressive than it actually is.
Employee Disapproval - One con that you must take into consideration is the opinions of your employees. Employees or departments within the business may not take to the idea of business intelligence tools and are unwilling to learn how to use them effectively. This would therefore be a huge waste of funds and business resources.
Data Breaches - A huge worry for many businesses when it comes to BI tools is their security. Many businesses worry that if they use these tools one simple error in the process could prove to be very harmful and result in a potential data breach. This security risk mainly comes if you use cloud-based or third-party services.
What Is Data Analytics
Data analytics is the process of collecting, cleaning, analysing and interpreting raw data in order to find valuable information, insights, and future trends. This valuable information allows businesses to make much more informed decisions, solve problems, and improve business operations.
Data analytics is very similar to business intelligence. However, data analytics is designed to convert and clean raw data into meaningful insights that are actionable. Whereas, the primary purpose of business intelligence is to aid business decision-making from business leaders using actionable business insights that it has gained through data analytics.
Pros Of Data Analytics
Improved Decision Making - The extremely insightful and data-driven information that it provides businesses with helps to make business decision-making more informed and reliable. It can help to spot valuable insights, patterns, market trends, and correlations that can be used to make big decisions on business operations and other business sectors.
Increased Efficiency - The information that data analytics provides a business with allows it to make decisions that will help to increase the overall efficiency and productivity of the business. The information can also help businesses to identify areas where productivity can be improved.
Improve Risk Management - Another amazing benefit of data analytics is its ability to allow a business to better manage risks. Data analytics have the ability to help businesses identify potential online threats such as fraud or operational threats. Using data analytics to improve risk management will lessen the possibility of any damaging breaches.
Enhance Customer Experience - Data analytics provides businesses with valuable insights into their customer's behaviour. Businesses can then use this information to identify the areas that they need to improve on to increase the customer's experience. It can also help businesses to tailor their processes to the exact needs of customers.
Cons Of Data Analytics
Low Data Quality - One limitation of data analytics is their access to high-quality data. Data analytics can often access a lot of data, but it is not always data that a business can use for beneficial actions. For example, if historical data has been analysed then it would no longer be relevant for the different business questions and processes that we have today.
Complexity - Most data analytics tools require in-depth and specialist knowledge to fully understand and digest. This is because it requires knowledge of the tools and their level of accuracy when it comes to analysing relevant data. The information can also be very difficult to understand unless you are highly trained and have vast knowledge of the data.
Privacy Concerns - There is a possibility that data analytics tools could breach the privacy of customers by analysing their personal data. This therefore means you must be incredibly cautious as to what data is being collected and analysed by the data analytics tools.
Which Is Better For A Business?
The answer as to which is better for a business is very difficult to say. This is because neither is necessarily better for businesses as they both serve different purposes. So it very much depends on the way in which you, as a business, want to analyse your data.
Business intelligence relies on data analytics, and cannot work without it. However, business intelligence focuses more on the bigger picture of a business's overall direction. Whereas Data analytics focuses more on single issues. Therefore, the best for your business depends on how you look at data and whether or not you want to utilise your data to improve your overall direction or to simply improve certain business processes.
One of the major differences between the both that could sway the decision of a business is how easy the data is to understand. Business intelligence is designed to make the data far easier to understand and digest through the use of neat dashboards and detailed reports. Whereas data analytics can be much more difficult to understand and therefore action.
Both data tools are extremely impressive and are constantly evolving and improving. No matter which you decide on for your business, they will help you to turn raw data into business growth that can help to further expand your business.
Business Intelligence & Data Analytics Consultants At Catalyst-Bi
Here at Catalyst Bi, we have a phenomenal team of highly experienced business intelligence consultants who help organisations unlock insights and drive performance through the power of data. Our data management consultants will help you to source, ingest, store and transform proprietary data for effective business intelligence.
Contact our expert team today on 0330 380 1609 and start utilising your data to support and grow your business now.
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