What is Business Intelligence?

Business intelligence (BI) refers to a category of technologies that analyse and interpret data to support optimised business decision-making.

Today’s business intelligence applications are typically web-based software solutions that rely on a centrally managed database or queries against a standard corporate data warehouse. These applications differ fundamentally from the traditional approach of delivering reports from an enterprise resource planning (ERP) system to individual users’ desktops.

By granting end users constant access to up-to-date key metrics through dashboards and scorecards that are tailored to their specific organisational roles, BI tools help organisations focus on important changes, exceptions and trends as they occur in real time.

What Are the Benefits of Integrating BI in ERP?

Business intelligence acts as a powerful tool in exposing undiscovered growth opportunities.

Integrating BI in ERP solutions improves businesses’ ability to accurately determine where to focus their efforts. The data extracted from each organisation’s activities holds significant potential for driving better decisions and operational expansion strategies.

To fully grasp the implications of business intelligence data in ERP systems, consider the following questions:

How will the right software replace a manual system? What features are necessary?
How will the right software improve current processes? Is there automation, or will the company continue to operate manually? How much time will be saved by switching to automated services?
Is the software easy to use or complex? Will company employees need training or support?

Optimised Decision-Making

Reliable data lead to fully informed, unbiased and intelligent decisions. When a company can trust the information that its ERP solution generates, a more accurate and complete picture of business trends and operations is presented. With this knowledge, organisations gain the ability to define trends and correlations between different events that may not be discernible without a unified view of the relevant data. Once these trends are presented, it becomes possible to respond proactively instead of waiting for issues to occur before reacting.

Support Compliance Efforts

Compliance is a critical issue for organisations across all industries and one of the most impactful yet elusive areas to address. With each new regulation and law, organisations are forced to examine their current processes and adjust as necessary. However, complying with regulations often involves more than simply altering business processes. The real challenge lies in gaining control over all the data each organisation generates connected to regulatory compliance efforts.

Fortunately, modern ERP solutions like SAP S/4HANA offer adequate support for compliance initiatives by leveraging advanced BI capabilities to provide insights into all aspects of business performance, from supply chain management to resource allocation.

Cost Reduction

Business intelligence tools enable companies to uncover areas of operation where cost reduction is possible. In-depth data provides an accurate picture of the operational inefficiencies that plague any company, allowing management teams to make informed decisions on how to move forward effectively. For instance, a trucking company using an ERP solution may find that it is wasting fuel due to inefficient driver dispatching patterns. Likewise, a manufacturing company could find out through its BI data that it is using its excess inventory ineffectually.

Along with helping businesses identify wasted resources, BI also helps companies find ways to increase revenue. These tools provide access to sales data across multiple locations and demographics, allowing businesses to target specific customers while adjusting products or services to meet their needs more effectively. Additionally, BI helps companies identify opportunities for product development or expansion into new markets based on existing customer trends and other customer data.

Enhance customer service

The data captured by ERP solutions can be utilised to enhance customer service in multiple ways. First, companies can analyse and segment customers based on their buying preferences and patterns. This ability makes it possible to spot customer behaviour trends and use them to create marketing campaigns that align with these trends. Businesses can also improve their customer support by giving their sales teams access to a complete list of all products purchased by a given customer, even if the purchase history is spread across several different locations worldwide. Finally, companies can track increases or decreases in overall customer satisfaction and loyalty over time, as well as monitor any anomalies that may occur, such as an unusually high number of requests for product returns during a given week after a holiday weekend sale.

How Can BI Enhance Customer Interactions?

Know Your Customers

Customer data can be captured in various ways, including social media, website behaviour and loyalty programs. These data sources contain information regarding customer preferences and past purchases, which can help businesses gain a better understanding of their customers’ needs. Business intelligence software allows organisations to harness these data sources by consolidating them into reports and dashboards that are easy to understand.

Understand Customer Interactions

Every point of contact with a company is an opportunity to collect valuable information about each customer’s buying patterns and preferences. Thanks to the analytics features of business intelligence software, this data is presented in a format that’s intuitive and straightforward to process.

Improve Customer Retention

BI tools offer a powerful way of boosting customer retention by making it easier for customers to purchase items and services. There are many different ways in which business intelligence software can be used to facilitate the purchasing process for customers, such as providing them with coupons explicitly tailored to their buying habits or offering personalised suggestions based on what they’ve purchased in the past.

How Does BI Maximise Productivity?

Business intelligence solutions can automate a wide range of processes, such as budgeting and forecasting, data warehousing and data analysis. These solutions can save time and money by eliminating the need to hire additional staff or resources. Additionally, automated processes provide relevant information in a timely manner, allowing employees to make faster, better-informed decisions.

BI Relieves the Pressure of Doing More with Less

As technology has improved and business processes have become more complex and interwoven, many companies have struggled to keep up with the pressures of doing more with less while operating at a greater speed. Shorter innovation cycles, heightened customer expectations and an increasing reliance on data to drive decision-making are among the forces driving this pressure. The result is an expectation to do more than ever before with less time to do it.

The conundrum of doing more with less time poses an issue that cannot be solved simply by hiring new personnel. There is always room for improvement when it comes to maximising productivity; no matter how much we think we are already taking advantage of every second of the day or meeting our potential in terms of efficiency, there is usually something else we can approach more intelligently. Fortunately, innovative solutions are available for companies to improve their business process while experiencing the benefits of greater productivity without needing to hire extra personnel.

Benefits of Business Intelligence in ERP

As technology continues to evolve, the benefits of business intelligence in ERP solutions present themselves in new and exciting ways. For example, consider the case of a manufacturing company with one warehouse, five manufacturing locations and ten distribution centres. The employees at each location enter data into their company’s ERP system. Leveraging this information, the company can run reports on sales data, inventory levels and more.

BI tools provide business insights that may be obscure at first glance, such as correlations between inventory levels and sales trends. When utilised properly, they hold the potential to transform business operations and optimise workforce efficiency.