Chapter 11 Business Intelligence Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-1

Why Do Organizations Need Business Intelligence (BI)? Business Intelligence System – An information system that supports business processes by consolidating and analyzing data in a large database to help users create information – Business analytics – Analytics Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-2

Why Do Organizations Need Business Intelligence (BI)? Business Intelligence System Figure 11-1 Examples of BI Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-3

How Does BI Support the Informing Process? The Informing Process Figure 11-3 Main Activities and Roles in the Informing Process Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-4

How Does BI Support the Informing Process? The Informing Process – Informing process in the Sales process Operational and Dynamic processes – Standardizing the informing process – Versions of the informing process Reporting and Data Mining Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-5

How Does BI Support the Informing Process? The Informing Process Figure 11-7 Two Types of Informing Processes: Reporting and Data Mining Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-6

How Does BI Support the Informing Process? The Informing Process – A process in which an actor, typically a person, seeks to become informed – Integrated with other processes – Provides insight to users and improves the quality of their information Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-7

What Are Examples of the Reporting Process? The Reporting Process – Noninteractive – Interactive – Five basic operations Sorting; Grouping; Calculating; Filtering; and Formatting Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-8

What Are Examples of the Reporting Process? The Reporting Process – Noninteractive Use a predetermined structure for output RFM analysis (recently, frequency, money) Figure Example of RFM Data Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-9

What Are Examples of the Reporting Process? The Reporting Process – Interactive Users allowed to change both the analysis and structure of the report OLAP –online analytical processing – OLAP measure; OLAP dimension; OLAP cube Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-10

What Are Examples of the Reporting Process? The Reporting Process – Noninteractive v. Interactive Figure Main Activities in Noninteractive and Interactive Reporting Process Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-11

What Are Examples of the Data Mining Process? The Data Mining Process – Cluster Analysis – Regression Analysis – Market Basket Analysis – Decision Trees – Supervised and Unsupervised Data Analysis Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-12

8/22/2011 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 13 Evaluating Backup Approaches for a Data Center (Using Satisficing oriented decision theory) Feasibility Study Interviewing for Requirements Decision approaches using Non-Optimization Methods

What Are Examples of the Data Mining Process? The Data Mining Process – Cluster Analysis Identify groups of entities with similar characteristics – Regression Analysis The impact of a set of variables on another variable Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-14

What Are Examples of the Data Mining Process? The Data Mining Process – Market Basket Analysis (MBA) Determines sales patterns – Decision Trees Hierarchical arrangement of criteria that predict a classification or a value – Supervised and Unsupervised Data Analysis Models and hypothesis Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-15

What Are Examples of the Data Mining Process? The Data Mining Process – Decision Trees Figure Grades of Students from Past MIS Class Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-16

What Are Examples of the Data Mining Process? The Data Mining Process – Advanced statistical analysis to find patterns and relationships among data for classification and prediction Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-17

What Are the Components of a BI System? Components of a BI System – Hardware – Software – BI Data – Procedures – People Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-18

What Are the Components of a BI System? Components of a BI System – Decision Support System (DSS) – Hardware BI Server – Software Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-19

What Are the Components of a BI System? Components of a BI System – BI Data Operational databases and data warehouses – Procedures – People End users and analysts Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-20

What Are the Components of a BI System? Components of a BI System – Hardware – Software – BI Data – Procedures – People Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-21

What Are the Potential Problems with BI Systems? Potential Problems with BI Systems – Data Problems – People Problems Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-22

What Are the Potential Problems with BI Systems? Potential Problems with BI Systems – Data Problems Figure Common Data Problems in BI Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-23

What Are the Potential Problems with BI Systems? Potential Problems with BI Systems – People Problems Figure BI People Problems: User, Analysts, and Leaders Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-24

What Future Technological Advances will Affect BI Use? Technology – Visualization and Augmented Reality – Mobile devices, RFID tags, and Web 2.0 Technology Backlash – Privacy Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-25

What Future Technological Advances will Affect BI Use? Technology – Visualization Creation of images or diagrams that communicate a message – Augmented Reality Live or indirect view of the real world augmented by computer-based data Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-26

What Future Technological Advances will Affect BI Use? Technology – Mobile devices – RFID tags – Web 2.0 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-27

What Future Technological Advances will Affect BI Use? Technology Backlash – Privacy – Personal Data Privacy and Security Act Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-28

Who Are the Key BI Vendors and How Does SAP Accomplish BI? Figure Major BI Vendors Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-29

Who Are the Key BI Vendors and How Does SAP Accomplish BI? Figure SAP Business Objects Report Example Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-30

Ethics Guide The Ethics of Profiling Customers Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-31

Conclusion Q1. Why do organizations need business intelligence (BI)? Q2. How does BI support the Informing process? Q3. What are examples of the Reporting process? Q4. What are examples of the Data Mining process? Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-32

Conclusion Q5. What are the components of a BI system? Q6. What are the potential problems with BI systems? Q7. What future technological advances will affect BI use? Q8. Who are the key BI vendors and how does SAP accomplish BI? Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-33

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall 11-34