What is Business Intelligence and Analytics, and How Do They Interact?
Big Data, Business Intelligence, and Business Analytics
Big data is the key to business success, and executives know it. With more online raw data than ever before, restaurant owners have access to actionable insights that can improve business operations. However, only 12% of restaurants know how to use data to their advantage. This is such a shame, as data analysis maximizes business performance and increases profits.
Between the data science-related jargon and a variety of analysis techniques, the average owner gets easily confused. What tools are they supposed to buy? Do they need to hire a specialist? How do they know which actions to take from their business information? It's no wonder so few restaurants leverage their business data.
A common problem is deciphering between business intelligence and business analytics. Both terms are critical to understanding but frequently used interchangeably. While the two interact, they are different concepts. Read ahead to understand the difference between the two and how they work together to maximize business decisions.
What to Know About Big Data:
How Business Analytics Fits into Business Intelligence
Business intelligence is how restaurants use current and historical data to streamline operations. Business analytics uses historical data and real-time information to identify patterns and make predictions. A manager may use BI tools to see how many sales were made or which team members were absent. BI software comes with an interactive dashboard and data visualizations that make the information easy to understand. BI solutions also enable quick reporting so users can drill down into specific data sets and answer supply chain-related questions.
On the other hand, the analytics process requires expertise from a team of data scientists. Analysts use a combination of machine learning, statistical analysis, and predictive modeling to generate insights from extracted data. They make specific recommendations and provide them to management, who can then optimize decision-making. Read ahead to learn more about how business intelligence fits into advanced analytics.
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Intelligence vs. Analytics Putting the Pieces Together
It's not that intelligence tools are better or worse than BI analytics. Every owner needs a BI platform in today's modern era. To understand business operations, identify weak areas, and analyze data sources, BI is a must.
On the other hand, BI analytics acts like both a parent and a child to business intelligence. While BA is also used to identify real-time and historical data, it goes further than that. It predicts future outcomes, whereas business intelligence does not. In short, BI is descriptive because it answers what happened. BA answers why something happened, along with what can be done about it in the future.
Therefore, it's not about business intelligence vs. business analytics. It's that restaurant owners require both. They need one to optimize current operations, and the other to improve future operations. They need one to do well today, and another to do well tomorrow.
Once analysts collect and analyze information, they use it to create predictive models. One common use of BA is ad hoc reporting. Restaurants can analyze a specific data set in real-time to answer a particular question. This BA feature enables owners to make quick business decisions that can increase profits and minimize waste.
Business analysts need good business intelligence to make their predictions. Without high-quality data and historical information, they can't predict future outcomes. On the other hand, business intelligence systems do not rely on analytics to exist. A company can use BI solutions and not perform analysis, but they probably won't grow as quickly as they need to.
Fascinating Stats on BI and BA:
Business Intelligence vs. Business Analytics Solutions
The best solution is to optimize data management and create high-quality business intelligence. This will streamline operations and ensure managers can make better quick decisions. Then, restaurants should hire a data scientist to conduct analysis. This will enhance current decision-making because the manager now knows future outcomes. In other words, businesses need both BA and BI for the best overall results.
Restaurants can use BA and improved BI to identify customer preferences and tailor marketing campaigns. They can also streamline inventory management, improve employee performance, and curate menu designs. All of this enhances the quality of customer service and improves customer satisfaction. As a result, restaurants will experience higher sales and greater brand loyalty. This provides a great competitive edge.
Key Takeaways of How Do Analytics Fit into Business Intelligence?
In conclusion, here is how analytics fits into business intelligence -
- Business intelligence is how organizations use current and historical information to create a competitive advantage.
- Business analytics is how data scientists use present and past information to predict future business outcomes. Recommendations are then presented to management, who can optimize current decision-making to align with future needs.
- BA depends on self-service BI, but BI does not depend on BA. However, BI is improved when BA is performed.
- Restaurants should use both BI and BA to get the most out of their collected data. This will enact data-driven business decisions, which improves future outcomes and results.
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