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How thin is the line between business intelligence and business analytics applications?

Business analytics is big right now. As with many new popular technology trends, there is a potential for existing conventions to lay claims to the newer conventions (I'm being very diplomatic here). Have you seen business analytic stickers being slapped on business intelligence applications/products? What is required to upgrade/morph/evolve (take your pick) an existing business intelligence application for it to be considered a 'valid' business analytics application?

Topics

Business Analytics

Business Intelligence

Data Governance

Data Management Software

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Steven Romero

asked on Jan. 5, 2012

Robert Keahey

IT, Business and Social Strategist/Commentator, SummaLogic LLC

Posted on Jan. 5, 2012

This is an interesting question Steven, and I'm not sure I have an answer. I agree that we tend to tweak the product labels/classifications to create new market opportunities. Or, as we often see, everybody jumps on the bandwagon and slaps the sticker on their website after the fact as you suggest.

I guess I don't see a huge difference between the two. Seems to me that business analytics would lead to (feed) business intelligence. The old "data to knowledge to wisdom" progression. But that's about all I can offer at this point, so really interested to see the other answers from the Focus community.

Steven Romero Replied on Jan. 5, 2012

Don't discount what you "can offer at this point." Your point that "business analytics would lead to (feed) business intelligence" perfectly highlights my 'confusion.' My view is that BI provides info about what happened and BA provides info about what 'will' happen – based on the info about what happened. So I am of the belief that I would use business intelligence information as a ‘feed’ into my business analytics.

But I understand your interpretation. The final outcome of all of this data collection and data analysis is 'business intelligence' - bringing us full-circle!

All of this being said, I am FAR more interested in the various 'interpretations' of the terms, as opposed to seeking a bullet-proof definition. Thanks for helping me to further the conversation.

Robert Keahey Replied on Jan. 5, 2012

Interesting thoughts Steven. I can see your point on BI being "backward looking" (if that's the right way to think about it), based on analysis of data that has been collected. And BA being forward looking, based on looking for trends/patterns. I kind of look at BA as finding those unusual patterns, and then using them in the overall process of determining what has and what will affect the business (BI). Obviously this is not may area of "academic" expertise! Anxious to see what others have to offer.

Bill Cabiro

Managing Director, Strat-Wise, LLC

Posted on Jan. 6, 2012

Recommended by:
Hrvoje Smolic,
Ehsan Alikhani

There is a lot of confusion in the market because there are almost as many definitions as vendors or experts.

The following terms are frequently used interchangeably: Analytics, Business Analytics, Predictive Analytics, Business Intelligence, Data Mining, Pattern Based Analytics. These terms have evolved in the last 10 years and their meaning expanded with the advances in technology.

Not to add to the confusion, I think that Business Analytics is an all-encompassing name for a new discipline resulting from the integration of Business Intelligence and Predictive Analytics. BA not only includes the classic Business Intelligence functions of reporting what happened, drill-down to how it happened, find out the cause of why it happened and alert management as soon key metrics move in the wrong direction.

In addition, BA includes a highly sophisticated subject called Predictive Analytics that can be defined as Advanced Computational Statistics. It uses large cleansed historical data sets to look forward. Specifically, Predictive Analytics finds patterns in the data to forecast what has a high probability to happen in the future.

BA applications include operational intelligence, reporting, strategic and competitive analytics, customer acquisition and retention, risk management, fraud detection sentiment analysis and demand driven forecasting among others.

Regards, Bill
http://blog.strat-wise.com

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Ehsan Alikhani Replied on Jan. 7, 2012

BI + PA= BA
It is a very fascinating definition provided a great insight for me. Thank you Bill.
But About your last paragraph where you mentioned " BA applications include operational intelligence...", I Think it is better to categorize the OI under the broad concept of BI not the BA since it's nature is rather real-time reporting to be prediction.

Bill Cabiro Replied on Jan. 7, 2012

Ehsan, Thanks for the kind words. BA includes BI with all its elements like OI.

I recommend reading Tom Davenport's Competing on Analytics.

Regards, Bill

Barry Devlin

Founder and Principal, 9sight Consulting

Posted on Jan. 6, 2012

How thin is the line between BI and BA? If I may be provocative... what line???

Business Intelligence has always been a broad church. As has probably every generic term invented in IT, promulgated by analysts and grabbed by vendors. And I haven't seen a single term or benefit attributed to BA (and now, indeed, big data) that hasn't previously been used in the context of BI at some stage. From a slightly cynical viewpoint, business analytics is simply marketing hype.

On a very practical level, the important thing to note is that two important trends are converging at the moment. One is the need for very current data. The second is an enormous explosion in data from unreliable / unverifiable / external sources. Together, these trends mean that the traditional data warehousing architecture where all data must be funnelled through and cleansed in the EDW is being circumvented regularly. So now we need to look to two distinct types of "decision support" -- one requiring cleansed, quality and consistent data (for financial reports and such like) and the other being very loose (for marketing and similar needs). If you want to call one BI and the other BA, be my guest. But, I suspect it won't stick!

Steven Romero Replied on Jan. 6, 2012

I agree that neither would necessarily "stick." And I have seen some of the BA-as-marketing-hype that you note. That said, a defensible definition will evolve if it hasn't already. Take a look at BIll's answer below and let me know what you think of his description of BA.

Linda Bernardi

Technologist, game changer, StraTerra Partners, Bernardi Leadership Institute

Posted on Jan. 10, 2012

This is a great question Steven. In some sense to me BI and BA are one in the same. Information/analytics which allows an enterprise to gain knowledge as well as improve processes. What is changing very rapidly is the internal silos/walls which separated the functions and make BI belong to a small group within a company vs now where many have access to information, can extract information and improve processes. I expect that we will blend these terms and have many more 'data scientists' within enterprises that deal with 'data'. Fundamentally we deal with data to get information which is either BA or BI, so either is cool, but I am simply thrilled that we are changing the playing rules and opening the silos. that is making many super uncomfortable, and that is where cloud is awesome as we are pushing the control from the hands of a few and accessible to many. what do you think?

Steven Romero Replied on Jan. 10, 2012

I like what you are describing in regard to the changes happening within the business. I've spent the past two decades as a silo-buster. But what actually prompted my question was the vendor-use of the terms vs.how businesses are using the terms. My fear is that vendors will slap BA-stickers on exsiting BI products - given the cache of the term business analytics. Thanks for your answer Linda.

muhammad hijazi

President, 3adda

Posted on Jan. 11, 2012

... I've been working in the BI business most of last 10 years for large scale companies and banks ended up with my own BI company ... so from the very practical point of view BA is just one branch of BI.. Conceptually, BIIC (business intelligence integration cycle) has four facets, Measurements, BA, Planing and then Improvements. From other angel, BI is an umbrella of BA, Alerts, BSC, BPI, ... etc. BI is whatever you do to business to turn it to IB!! ...

Steven Romero Replied on Jan. 11, 2012

Thanks for the response Muhammad. You provide a concise view of the 'discipline.' Now, what about the 'applications?' In the past, most any application providing data for business decisions could be used as a feed to the discipline of business intelligence. But those apps did not necessarily automate any analysis of that data or provide any conclusions - and I am under the impression that is what a business analytics app can do. The nature of my question shows I am a novice on the subject of BI/BA apps, but I am under the impression that business analytics applications are the latest and greatest, while business intelligence applications are not new at all. I'd love to hear more of your thoughts.

muhammad hijazi Replied on Jan. 11, 2012

.. most of people think that BI applications is all about reporting, KPIs, Nice colorful Guages, .. etc. Technology Vendors may also helped to build this image. BI applications are far beyond this. To explain how typical BI application should proide, we need many hours. But to clear your confusions, BA is the corner stone of BI ( .. also application wise), however BI has other corner stones that should deliver that BA in TIMELY and CONTEXTUAL manner in alignment to the strategy. Thank you.

Daniel Power

Editor, DSSResources

Posted on Jan. 11, 2012

Both BI and BA are subsets of computerized decision support. Vendors and consultants do not agree on the categories. You may be interested in two of my columns:

How do predictive analytics support decision making? at URL http://dssresources.com/faq/index.php?action=artikel&id=239

What is business intelligence? at URL http://dssresources.com/faq/index.php?action=artikel&id=4

Steven Romero Replied on Jan. 11, 2012

Thanks Daniel, I'll take a look.