Business intelligence (BI) applications and technologies can enable organizations to make more informed business decisions, and they may give a company a competitive advantage. For example, a company could use business intelligence applications or technologies to extrapolate information from indicators in the external environment and forecast the future trends in their sector. BI is used to improve the timeliness and quality of information and enable managers to better understand the position of their firm in comparison to its competitors.
BI applications and technologies can also help companies analyze the following: changing trends in market share, changes in customer behavior and spending patterns, customers’ preferences, company capabilities and market conditions. BI can be used to help analysts and managers determine which adjustments are most likely to affect trends.
BI systems can help companies develop consistent and “data-based” business decisions–producing better results than basing decisions on “guesswork.” In addition, business intelligence applications can enhance communication among departments, coordinate activities, and enable companies to respond more quickly to changes (e.g., in financial conditions, customer preferences, supply chain operations, etc.). When a BI system is well-designed and properly integrated into a company’s processes and decision-making process, it may be able to improve a company’s performance. Having access to timely and accurate information is an important resource for a company, which can expedite decision-making and improve customers’ experience.
In the competitive customer-service sector, companies need to have accurate, up-to-date information on customer preferences, so that the company can quickly adapt to their changing demands. BI enables companies to gather information on the trends in the marketplace and come up with innovative products or services in anticipation of customer’s changing demands. BI applications can also help managers to be better informed about actions that a company’s competitors are taking. Also, BI can help companies share selected strategic information with business partners. For example, some businesses use BI systems to share information with their suppliers (e.g., inventory levels, performance metrics, and other supply chain data).