Proactive Business Intelligence!

We all know that Business Intelligence is present in every company at some level. The future of every company depends on the the quality of the adopted BI strategies. Business Intelligence is a term which sums up tools, processes and people that help the process of decision making. But this is only generally speaking. The real BI is different from company to company and because of its continuous development it got to a point where a decision making process is formed from many more other smaller decision making processes. The bigger the company is, the bigger the process is, thus the more decisions are taken by lower level and department management.

As you can see in the above figure, the time frame for the data to get into a reporting software is about 6-12 months.

Traditional BI has helped companies make decisions using historical analysis for a long time, but the data was stored at a level that there is no operational data to base decision. However, lately, the attention shifted more towards operational data. This is the key for reducing the reaction time, thus the need for a more proactive Business Intelligence solution appeared.
Strategic Business Intelligence or Reactive BI, as it is commonly known, is a time consuming process. The data is analyzed and reports are being created on a weekly or monthly basis. Sometimes, reports are created on a yearly basis. This is an excellent method when large sets of data are being analyzed, especially when the company is targeting a market with a large audience.This type of BI is usually used by senior management or higher level management and decision makers.
But this type of long-term analysis can also have its downfalls: because of the duration of the whole process, reactive BI can fall short of achieving deadlines. And the data latency increases the closer you get to the database or data warehouse. Also, a long management chain will extend the duration of the decision making process. To avoid this type of situations, proactive BI is the solution.
Even if the idea of real time Business Intelligence is impossible at this moment, the idea of real time intelligence at an operational level has started to develop more and more, especially when it comes to big companies and corporations. And because of the advances in technology and data processing tools, this new and revolutionary idea has started to expand to smaller companies as well.
The main objective of proactive business intelligence is to identify potential problems and issues so that front-line operators or department managers can solve them before reaching the client. Also, a shorter hierarchic chain means a shorter reaction time.
Proactive BI is also known as operational BI. Even if it’s hard to tell where the strategic BI ends and where the operational BI begins, at least in theory, at a department level we have already crossed the line towards a more operational business intelligence.
Using BI tools for monitoring and analyzing trends and behavior changes on smaller groups will give the opportunity of identifying problems at a smaller level. Using a reporting software to create reports when the numbers jump over the parameters that have been set may have results in real time, which could help the management to take better decisions.
Let’s take as an example a toys manufacturer. Even if during holiday seasons a lot more toys are being sold than in a regular day, the demand still has to be monitored. So if a reporting software is used to deliver daily reports concerning production and demand, the departments know what toys to make and when to manufacture them. This way they know that they have to increase or decrease the productivity of certain products even before the demand drops or spikes.
Proactive Business Intelligence can even be used for decision making at smaller levels. Empowering people at a department level with decision making is the only way to have a real time reaction to the reports. After all, a reporting software is worth nothing if it takes a long time to help you make a decision. A report that has to be passed through many hands before it reaches a decision-making authority is equally worthless.
I have been saying this for a long time and I will keep saying it: Business Intelligence has started to spread and develop a lot more during the last years. We can now see that it’s beginning to enclose its ramifications in all the departments of a company. Hiring the staff, purchasing the reporting software, expanding the business, these are all decision which must be considered from a BI point of view. And as much as we try to understand BI at a smaller level we will see that a proactive intelligence is needed for a business to stand.