Business Intelligence vs. Business Analytics How Do They Stack Up?

Business Intelligence vs. Business Analytics

A mere 20 years ago, concepts such as big data and the digital revolution were foreign to restaurants. While the internet certainly existed, there weren't the technologies and tools available to leverage online data. Most organizations used manual processes to gain insight into the competition and make business decisions.

Nowadays, there are college majors designed specifically for coding, data science, and business analysis. Studies show that data science degrees are the fastest-growing major throughout the country. Businesses demand specialists who can drill down into big data and extract valuable insights. Students across the country see the value in that.

Data science specialists review existing business intelligence or all of the tools and data used to share and deliver information. They employ a combination of machine learning, statistical analysis, and modeling to study specific data sets and answer questions. This is referred to as business analytics.

Analytics helps optimize future decision-making and predict customer preferences and trends. Restaurants and small businesses that use BI and BA can increase profits, decrease inefficiencies, and maintain a competitive edge. Business analytics and business intelligence are separate terms that intertwine with one another. Both are crucial parts of running a successful restaurant in the digital age. Read ahead to learn more on BI intelligence vs. analytics.

By the Stats - Business Intelligence and Analytics:

• 60% of companies use BI and BA to boost cost efficiency
  
• 57% of companies use BI and BA to drive strategy and create meaningful, profitable change
  
• 52% of companies use BI and BA to optimize employee performance and increase operational efficiency
  
• 71% of enterprises around the world say they will invest more in BI tools and BA specialists
  

Difference Between Business Intelligence and Business Analytics

Business analytics uses restaurant data to forecast trends and predict outcomes. This requires expertise in modeling, data mining, data discovery, and statistical analysis. As most restaurant owners aren't experts in the subjects, they hire a data science specialist to do the work.

BA focuses primarily on predictive analytics, or modeling and learning used to pinpoint specific outcomes. It answers why an event occurred, rather than what occurred. A specialist will present findings to an owner, along with predictions about sales, customer preferences, etc. Typically, the restaurant has several specific questions it needs to be addressed ahead of time.

On the other hand, business intelligence is all of the technologies and processes used to collect and share data. This collected data is typically on a dashboard, where users can view it in one centralized location. Business intelligence tools are descriptive. They provide a summary of historical or real-time insights, which helps managers perform their jobs. BI tools are easy to use and do not require extensive training or expertise. Unlike BA, BI answers what happened, not why.

Business Intelligence vs. Business Analytics Present & Future Focus

Restaurants may be unsure of what type of tool to invest in or what questions they need to be answered. The vast majority of small businesses use some form of business intelligence tool, though it may be relegated to upper management. There must be a way for managers to see the day-to-day sales numbers and monitor employee performance. Manual processes just don't cut it anymore.

BI platforms also enable easy reporting, which comes with powerful data visualizations. A report is simply a story of a specific data set, using pictures and graphs. These reports are very easy to generate and present to management. They can assess everything from inventory levels to absenteeism rates to sales data. It simply depends upon the restaurant's needs and the BI system's capabilities.

Business intelligence systems are for current processes. They do use historical data to create descriptive reports, but they don't predict future results. On the other hand, BA tools are entirely focused on predictive analytics or PA. Predictive analytics uses historical and current data to make forecasts for the future.

So, which type of tool should a restaurant pick? It depends on the goals and needs of an organization. Most businesses want to grow and gain a competitive edge. They probably can't make the gains they need if they only use BI platforms. If they want a way to get ahead of the competition, predict customer preferences, and increase ROIs, BA is where it's at.

Simultaneously, restaurant managers should also use a BI platform to streamline day-to-day operations. Data analytics specialists cannot truly perform their job without good business intelligence. They need access to current and historical data to make their predictions.

Top Benefits of Business Analytics:

• Business analytics helps measure how much of the restaurant's mission statement is accomplished
  
• Business analytics encourages intelligent decision-making
  
• Business analytics provides clear insights with the use of data visualizations
  
• Business analytics keeps all critical stakeholders informed
  

Business Intelligence vs. Business Analytics In the Real World

All of this talk about data and systems and tools can be confusing. It can help to see an example of how both business intelligence and analytics work in the real world. This enables restaurants to know which set of tools is best for them, and what type of analytics is most valuable.

Here are a few questions that a business intelligence tool may answer -

• How many ketchup bottles are in stock, currently? How many bottles did the restaurant order last month?
• What are the names of all new hires and what dates were they brought on board?
• Which workers have been late in the last month? What time did they come in, on average?
• What were the total sales for the last 3 months? Is that lower or higher than the total from the previous year?

Here are a few questions that a data science specialist may answer when performing business analytics -

• Why were expenses so high last month and how can the restaurant reduce expenses by 10% next month?
• Why was there a decrease in sales during May?
• What are the specific factors leading to high absenteeism rates during August?
• How can the restaurant customize and improve its marketing campaigns to reach new customers?

Both BA and BI are critical for any small business. While restaurants require some type of BI platform to maintain operations, they need an analyst to maintain long-term growth.

Key Takeaways of Business Intelligence vs. Business Analytics

In conclusion, here is what to know about an intelligence business vs. an analytics business -

• BI and BA are separate terms that intertwine with one another. Business intelligence is all of the tools and processes used to deliver and share information. Business analytics uses real-time and historical data to answer specific business questions and make recommendations.
• Business intelligence answers what occurred, while business analytics answers why an event occurred.
• Restaurants can use a combination of BI and BA to streamline operations and maintain innovation and growth. Data specialists need a BI platform to access real-time and historical data that enables good insights. However, some restaurants prefer using just a BI platform to maintain control over day-to-day operations.