Description
A collaborative approach of Business Intelligence systems
Journal of Applied Collaborative Systems Vol. 2, No. 2, 2010
91
A collaborative approach of Business Intelligence systems
Gheorghe MATEI, PhD
Romanian Commercial Bank, Bucharest, Romania
[email protected]
Abstract: To succeed in the context of a global and dynamic economic environment,
companies must use all the information they have as efficiently as possible, in order to gain
competitive advantages and to consolidate their position on the market. To achieve these
goals, the companies must use modern informatics technologies for data acquiring, storing,
accessing and analysing. These technologies are to be integrated into innovative solutions,
such as Business Intelligence systems, which can help managers to better control the business
practices and processes, to improve the company’s performance and to conserve it’s
competitive advantages. This paper presents Business Intelligence systems and emphasizes
their collaborative feature.
Keywords: Business Intelligence, collaborative systems, competitive advantages,
decision making process, portal
1. Introduction
Information is stored anywhere in modern organizations: in transactional systems, data
warehouses, computer networks and personal computers. It is used to assist most of activities,
both operative, tactical or strategic. Nowadays, information supports all critical business
decisions. Most of organization consider that information is a strategic asset and act for the
permanent optimization of its management and usage in order to gain competitive advantages.
It is unanimously stated that all activities in an organization are based on information.
That is data acquiring, storing, transporting and processing. Information becomes a new
resource, a real asset of the new economy. The impact of information and communication
technologies (ITC) on business modifies the perception of information as a factor of
production. While in times past a business was defined as people, technologies and assets, in
the knowledge-based economy people, technologies, assets and information are taken into
consideration. The new economy is characterized by a greater impact of information resources
on production chain, the gradual disappearance of borders between products and services, and
the appearance of new business opportunities based on ITC (e-business, e-commerce, e-
banking etc.).
More and more organizations consider that their knowledge and competence are the
most valuable asset they have. In the new economy, ITC usage contributes to gaining
important benefits and competitive advantages, and determines organizations to become more
flexible and to adapt themselves to the changes in the business environment.
Any company’s success depends on how well it understands its business processes,
how efficient it manages its operations, and how well it knows its customers. To stay
competitive, companies must be able to identify their profitable customers, their business
trend, the most sold products, and the most productive distribution chains. Getting high
quality data is no longer a profit and loss issue, but a surviving on the market issue, a matter
of success or failure. Companies have understood that the future means analyses, reports,
forecasts, as well as real-time data management. A judicious data usage is not possible
Journal of Applied Collaborative Systems Vol. 2, No. 2, 2010
92
without a proper, powerful and robust information infrastructure, that allows usage of all
company’s data for making the best operative, tactical and strategic decisions. In today’s
context of a competitive economic environment which is permanently changing, the ability to
use information in an intelligent way, in order to cope with challenges and to benefit for
opportunities, represents an essential condition for any company that wants not only to stay on
the market, but also to consolidate its position. As information is the basis of all activities in a
company, this one must use information systems that can produce and manage it properly.
These systems must ensure the information availability for all users that need it in a timely
manner and in a proper format, provide to executive managers the possibility to view, analyse
and assess the company’s business processes, that is underlie their decision on an information
support based on Business Intelligence (BI) technology.
2. Short presentation of Business Intelligence technology
To achieve the above purposes, it is necessary to implement information solutions that
are able to offer to managers a complete and consistent view across the present status of the
organization, as well as projections on different periods of time, solutions that are able to
support the decision making process in order to adopt coherent and well-founded strategies. A
BI solution is one of the best solutions that can respond to these goals. A BI system is “an
information system with an open and flexible architecture that integrate innovative
technologies that are able to ensure a uniform and consistent storage of all data that are
relevant for their organization and the environment it is acting in, turn data into information
and knowledge, and use it judiciously use it in the decision making process, so that to
conduce to gaining competitive advantages against competition” [1].
BI systems emphasize data integration, analysis and mining, as BI aims to provide the
capability to access and analyse information and benefit on the competitive advantages
offered by these analyses.
BI has started up in order to respond managers’ demands for an efficient analysis of
company’s data, to better understand the business status, and to improve the decision making
process.
In the early ’90 it became an interest field for academia and, in the next ten
researching years, several technologies were transformed in well founded approaches
concerning data extract and processing.
BI solutions manage data storing in a different way than that used by transactional
systems. This way facilitates proactive searches and analyses of data from various and
isolated sources. A BI solution helps in generating and disseminating valuable information to
people that can use it for analyses needed in the decision making process.
Nowadays, BI got a greater importance for decision makers. Data acquisition – from
operations, customers, business partners and employees – was always an important action for
business running, but now the proactive usage of information has become essential. BI makes
a difference between reacting to problems and anticipating opportunities, and between
experience-based presumptions and proactive fact-based decisions [2].
BI systems integrate data from various sources, store it for a long period of time, so
they offer facilities of discovering trends and patterns that can be used for business value
improvement. This is ensured by improving communication and planning. As they are
flexible and scalable, these systems provide fast and efficient responds when the environment
is changing. They enable critical information to be duly accessed and eliminate unfounded
presumptions, ensuring a strong support for the decision making process.
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BI systems concur to efficiency and productivity increase, enabling collaboration
between all organizational structures and a global view over the entire organization, as well as
deploying role-based solutions, according to the requirements and tasks of each user. Users
become more efficient in their role, because each user can access the data he needs and the
appropriate tools.
3. Business Intelligence systems, as collaborative systems
Taking into consideration those presented above, BI can be defined as “a combination
of data, processes, tools and technologies that provide to managers valuable information that
support decisions made in order to increase the organization’s efficiency and profitability”
[3]. It allows users on any organizational level to access data, to interact with it and to analyse
it in order to run the business, to improve the performance, to discover new opportunities and
to operate efficiently. Such a system provides a global view over the entire organization,
enables data analyses from multiple points of view, and allow a fast feedback when the
business environment is changing.
A company’s success is based on information, and BI is a permanent process of data
acquiring, analysing and dissemination. Its main purpose is gaining and conserving
competitive advantages, preventing failures and exploitation of the opportunities that appear
on the market. BI systems create an intelligent business framework that enable delivery of
consistent and high quality information to all users, both inside and outside the organization.
They offer ways for network communication, enabling a fast dissemination of information,
and a better synchronization of all organizations activities. As a matter of fact, BI is a generic
term, un “umbrella” for a set of applications and technologies for data accessing and
analysing in order to support users to make better decisions.
BI systems help users to identify and solve their problems, to discover business risks
and opportunities, to anticipate market’s trends and to estimate competitors’ operation. They
allow a better understanding of business requirements, and a better management of customers
and suppliers relationship. Using such systems, managers can react faster to the problems that
appear, to estimate correctly the company’s position against competitors, so the company is
able to gain competitive advantages.
Although BI systems have evolved in order to respond to increasing analysing and
reporting requirements. From traditional reporting and analysing applications, now they are
powerful, friendly and faster tools designed for strategic decision making and performance
management. More stages can be identified in BI evolution, as shown in figure 1. Starting
with transactional applications that could deliver static reports regarding the company’s
activity, Management Information Systems (MIS) and Executive Information Systems (EIS)
were developed in the middle ’80. One of the major problems these systems cope with was
that they needed a lot of manual work for data conversion and load from data sources into the
repositories used by these systems. Starting with the early ’90, data warehouses and Extract,
Transform and Load (ETL) tools began to be largely used. The developing of new powerful
analytical instruments has led to an intensive usage of BI tools. The progress of these systems,
their functionality and capability improvement, is attended by a continuous approach to end-
users, systems becoming more friendly, reliable and easy to use.
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Fig. 1. Evolution of BI systems [4]
In [5] it is stated that three stages can be identified in BI systems’ evolution. First,
simple SQL-based reports were developed. The first BI systems were generating many
reports, and users had to spend a lot of time to analyse them in order to get the needed
answers. Applications, developed in a client/server architecture, were offering a fast access to
data, but it was rather difficult to use them, so they were used only by analysts and not by
managers and executive directors.
When data warehouses began to be used, the second BI systems generation started.
These repositories store consistent, present and historical data, both detailed and aggregated,
that are organizes simpler than in traditional databases, using a data model that is alike to real
life. Thus, the model can be better understood by managers and other non-IT users, and is
more adequate to analyses. Data warehouses were followed by data marts – specialized data
repositories that accelerated the delivery of information to managers with the aim of making
well founded decision. The On-Line Analytical Processing (OLAP) technology was
developed as an alternative to a dynamic access to complex data, as well as other dimentional
analysis tools that allow managers to analyse data from multiple perspectives and explore it in
order to discover hidden information.
Later, when it was clear that developing a data warehouse is just the first step in
building a BI solution, the third generation of these systems has started. The new systems
could offer a consolidated view over the entire organization, dynamic reports from various
departments, prediction capabilities, large and fast access at information on different
hierarchical levels. Though dimentional cubes and star schemas are still used, more complex
analytical solutions are largely used. These solutions use data mining techniques, statistical
methods and technologies that provide ad-hoc analysis capabilities. These technologies are
more and more used in operational workflows, and not only for strategic decision making.
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Nowadays, users have at their disposal a large set of powerful graphical equipments, used for
data processing, communication, collaboration and cooperation. BI solutions provide a large
functionality, from a simple data access to complex interaction and Web report generation.
The synthesis of the stages described above is shown in figure 2, where BI systems’
evolution presented based on their complexity and analytical capability.
Fig. 2. The generations in BI systems’s evolution
The need of intelligent information solutions grows as the company’s volume of data
becomes larger. As their name shows, BI solution enable an intelligent usage and analysis of
company’s business data. They help managers to better control the business practices and
processes, and duly analyse the company’s key performance indicators.
An essential requirement for the business growing and the improvement of company’s
position on the market is to better understand the business and factors that have both a
positive and, especially, a negative influence. Using the new information technologies,
companies learn what has happened in their business, why it has happened and what will
happen. At the same time, BI solutions contribute to the elimination of communication
barriers inside the company and enable decision making process on the basis of consistent
information and collaborative support [6].
Thus, BI has an essential role in consolidating company’s position on the market,
implementing the best practices, and business processes improvement. As a result, the
company can operate at a high quality level and become more competitive and efficient.
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4. Business Intelligence – an instrument for a collaborative decision making process
BI systems aims to provide to the decision making process accurate, consistent and
pertinent information. They make possible developing of evolved decision support systems,
capable to assist tactical and strategic decision making, operations and business processes
improvement. Thus, these systems contribute to profitability increasing and gaining
competitive advantages.
BI systems can provide historical reports, data analyses and alerts that signalize
problems and possible threats. Analysing historical information, managers can evaluate the
former activity. But it’s necessary to estimate the future evolution to, in order to anticipate
events and make the most appropriate decisions. BI systems join various activities within the
company and emphasize relationships that are difficult to be observed. So, BI overdraws the
borders of a stand alone activity and becomes an integral part of the way the business is
conducted.
It is necessary that BI solutions be available not only for managers, but also for a great
number of employees. At the same time, they must be able to be used by external users, such
as customers, business partners, and providers, and to take into consideration the requirements
of each user category.
Using all its data, making complex analyses, a company gets new information
concerning the business environment and its competitors. This information allows it to better
understand its customers’ behaviour and anticipate their requirements, to correctly manage
threats and risks, to identify opportunities to increase its revenues and reduce costs. Acquiring
and storing large volumes of historical data provide the capability to discover patterns and
factors that influence the company’s activity and to predict the future business evolution.
Without BI systems, selection and analysis of relevant information are hardly made, and
results are seldom incomplete and provided to late. Only companies that are using BI
technologies can cope successfully with the concurrent environment challenges [7].
Not too long ago, only few departments within a company were using BI applications.
Now this situation is changing rapidly, by developing and implementing new systems that
covers the entire functionality of the company. It is stated that usage of BI solutions
contributes to an open and active information culture [8]. At the same time, through these
systems BI advantages are offered to all the people involved in that business: employees,
shareholders, customers, providers and other business partners. As information is provided to
all interested people, they may state that a democracy of information is instituted at all the
levels inside the company and even outside it.
The decentralization of the decision making process has determined an increased need
of information into organization, and a portal is one of the ways through which a BI system
ensures its dissemination. Because not all users are interested by the same set of indicators,
which depends on every one’s level and requirements, a portal or another platform having the
same functionality has to be used.
A portal allows users to access the company’s intranet. It allows employees to access
and share the company’s data and information. At the same time, it provides capabilities such
as: classification of information that is available on intranet, a searching engine, news
concerning the organization, access at the email service and other information applications, a
document management solution, links to other sites, both inside and outside the company etc.
A portal is the interface between BI applications and users, an information space that
is well organized and easy to understand, where users find the tools and information they
need. It’s a Web-based secured interface that provides a single point for integrating all the
company’s information and accessing it. It also integrates the applications and services that
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are used by employees, business partners, providers and customers. As an example, figure 3
shows the portal of a banking company.
Fig. 3. The portalul of a banking company [9]
The portal in the figure above provides to bank’s customers the possibility to make a
large set of banking operations, in real time and in a secured environment (users identify
themselves through their codes and passwords). It also provide the possibility to access
detailed information concerning bank’s products and services, branch network, exchange
rates, links to the Web pages of bank’s subsidiaries, and other useful tools and information.
As a collaborative platform, a portal enables people, usually from remote locations, to
meet each other and to share information, to interact together and use specific tools in order to
achieve common goals. A portal is a component of organization’s information strategy and it
integrates several applications developed to solve business problems. These applications
ensure information consolidation, management and distribution both inside and outside the
company. Through Web services, not only applications are integrated into a portal, but also
data, business processes and people, ensuring in this way the communication and
collaboration between users, as well as the delivery of integrated business solutions. Portals
facilitate knowledge delivery, improvement of planning and product development processes,
and creation of more efficient functional relationship between groups of people [10]. They
offer a better view over the entire organization and help making more efficient decisions. All
these contribute to a better understanding of business processes and productivity increasing.
All portals are using the Web technology. It’s unanimously stated that the Internet has
influenced the way that organizations operate, as well as information applications nature. It
enables resources sharing and a rapid change of information with customers and business
partners. Schematically, these relations are shown in figure 4, that presents the connection
between a BI system and external users, through Internet.
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Fig. 4. Business Intelligence and Internet
As a conclusion, a portal is a platform through which various specialized tools are
made available to all users within the company. Together with ad-hoc query and analyse
tools, with dashboards and scorecards, they provide an easy, fast and flexible access to
information stored in various data repositories of the organization.
5. Business Intelligence system development
Nowadays, a company is appreciated not only in terms of its products and services,
but also of the information provided to its customers, employees and business partners. The
more information is offered, the more valuable the company is. The problem is that
information is not stored into a single place. Most of organizations have more information
systems, everyone having its own data sources and data presentation tools. Therefore,
information is managed by more departments or business units and is difficult to ensure an
efficient coordination of this activity. BI systems solve this problem and ensure that users get
the information they need, so they can make the best decisions.
A BI system consists of more information applications and technologies that allow
data extract, integration and consolidation from various systems within the company and
storing it into a single repository that enable information accessing and analysing and
knowledge dissemination to internal users, customers, providers, shareholders and other
interested people. The usage of such instruments allows users to focus on actions that have a
big impact and to duly identify the opportunities that can occur. As they provide on time
accurate, up to date and relevant information, BI solutions facilitate the business performance
management and help in making better decisions.
A BI system has to allow the integration with other collaborative systems and services,
such as email, Web etc. Such services increase the system’s value and certify that users will
use it. The system has to ensure data distribution and information sharing in the entire
organization, that is ensuring all users’ access to the information they need.
Building a BI system is based on a methodology that is different from that used at
transactional systems’ development. A prototype has to be built quickly, even if it doesn’t
respond to all the end-users’ requirements. The system will be developed by building
successive iterations, more and more complex and closer to the final version – the so called
“spiral” approach. Trying to build the system into a single iteration has a little chance to
succeed, because of very large financial and time resources that are needed.
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A BI system is an enterprise one that evolves together with the organization and is
permanently enhanced according to business users’ feedback. Because of its complexity and
differences to transactional systems, a BI system cannot be developed into a single iteration; it
is built in an iterative approach. In every iteration the stages presented in figure 5 are scanned;
a new version is built, as the system becomes more evolved and mature.
Fig. 5. A BI system developing cycle [1]
During the justification stage, the necessity for a new system is presented and
contended, the project scope is defined and the needed costs and expected benefits are
estimated.
During the business analysis stage, the problems are analysed in depth, a global
solution for solving them is established and a plan for the next activities is made.
During the system evaluation stage, the organization’s infrastructure, data that is
available, and hardware and software components are assessed.
During the architecture design stage, the new system’s technical structure is
established, so that it can respond to the aimed business requirements.
During the database design stage, the new system’s logical and physical data
structures are developed.
During the application design stage, instruments needed for extracting data from
source systems, its transformation and load into the data warehouse, interfaces for accessing
data and tools for its analysis are built.
During the application development stage, the instruments that were designed are
built, tested and validated.
During the implementation stage, the integration and testing of all the system’s
components are made, as well as the users’ training and the deployment of the new system.
During the maintenance stage, the system’s management and monitoring are made, in
order to ensure its running as the parameters were set on.
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Based on system’s monitoring observations, technological progress, users’ new
requirements, evolution of the economic, social and legislative environment, requirements for
future development are established.
The complexity of a BI system makes impossible its development into a single
iteration. The stages presented above are resumed into a new iteration, that will produce a
system’s new version, having enhanced capabilities. During this iterative process, a special
activity – the project management – is run on. During this permanent stage, an efficient
communication has to be established between functional departments and IT department.
6. Conclusions
Nowadays, organizations cope with much more challenges than ever before: fast
changes in a global, complex and competitive business environment, the change and
diversification of users’ requirements, the growing complexity of systems and technologies,
extended regulation and compliance requirements. Permanently, organizations generate, use,
store and share information with their customers, business partners and providers, At the same
time, they have to report periodically certain information to their shareholders and to various
regulation and control institutes.
To cope with these challenges and to stay on the market, organizations have to
implement new information systems, that can transform them into dynamic organizations,
capable to react quickly and efficiently to all changes in the business environment. As
information has become a strategic asset, capable to provide competitive advantages, the new
systems have to ensure the integration of all data the organization has and store it into
repositories that allow complex analyses, pertinent forecasts and decisions made to ensure a
permanent development of the business. Such systems stopped to be just an option, they have
become a necessity, am imperative of our times. Among them, a special class is constituted by
Business Intelligence systems, that are complex systems allowing the efficient integration of
information technologies, both the current and the future ones.
Business Intelligence (BI) is a generic concept that groups under the same umbrella
more instruments from business and information fields, instruments that are used in order to
transform data into information, information into decisions, and decisions into successful
actions.
At the beginning, BI systems were destined only to strategic level of organization’s
management. Nowadays, they are to be used by a lot of users, from all the hierarchical levels
of the organization. At the same time, they are open to external users to, such as shareholders,
customers, business partners and providers. Now, a company is judged not only depending of
the quality of its products and services, but also depending on the way it provides information
to users, both internal and external.
A BI system allows users on all the organization’s levels to access the data, to interact
with it and to analyse it in order to run the business, improve its performance, discover new
opportunities and act efficiently. Such a system offers a global view over the entire
organization, ensures the possibility to analyse the activity from multiple perspectives and
allows rapid reactions to the business environment changes. All these purposes are treated in a
collaborative manner, ensuring a single version of the truth for the entire organization.
Journal of Applied Collaborative Systems Vol. 2, No. 2, 2010
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References
[1] M. Velicanu and Gh. Matei, Tehnologia Inteligenta Afacerii, Editura ASE, Bucuresti,
2010.
[2] M. Velicanu and Gh. Matei, “Utilizarea solu?iilor de Inteligen?a Afacerii în sistemul
bancar,” Revista Contabilitate ?i Informatic? de gestiune, No. 26, 2008.
[3] Gh. Matei and M. Velicanu, “Business Intelligence – philosophy of successful
companies,” Proceedings of the Fourth International Conference on Economic Cybernetic
Analysis “Global Crisis Effects on Developing Economies”, special session “Decision
Making Modeling and Risk Assessment”, ASE, Bucharest, May 22-23, 2009.
[4] N. Rasmussen, P. S. Goldy and P. O. Solli, Financial Business Intelligence: Trends,
Technology, Software Selection and Implementation, John Wiley and Sons, Inc., New York,
2002.
[5] M. Muntean, Ini?iere în tehnologia OLAP. Teorie ?i practic?, Editura ASE, Bucure?ti,
2004.
[6] M. Velicanu and Gh. Matei, “Databases versus Data Warehouses,” Proceedings of the
Eight International Conference on Informatics in Economy, Informatics in Knowledge
Society, ASE Publishing House, 2007.
[7] M. Velicanu and Gh. Matei, “Solu?ii informatice suport pentru afaceri inteligente,” Revista
Studii ?i cercet?ri de calcul economic ?i cibernetic? economic?, No. 1, 2008.
[8] J. Salmeron, „EIS data: findings from an evolutionary study,” Journal of Systems and
Software, Vol. 64, No. 2, 2002, Elsevier B.V., pp. 111-114.
[9] www.bcr.ro/bcrro
[10] M. Muntean, „Business Intelligence Solutions for Gaining Competitive Advantage,”
Revista Informatic? Economic?, No. 3 (43), 2007.
Author
Gheorghe MATEI has graduated the Faculty of Planning and Economic
Cybernetics in 1978. He achieved the PhD in Economic Cybernetics and
Statistics in 2009, with a thesis on Business Intelligence systems in the
banking industry. After a long career in the IT department, now he is working
in the accounting and reporting department in Romanian Commercial Bank.
His fields of interest include Business Intelligence systems, data
warehousing, decision support systems. He is the author and co-author of
several articles in journal, international databases and proceedings of national and
international conferences in the mentioned domains.
doc_517325131.pdf
A collaborative approach of Business Intelligence systems
Journal of Applied Collaborative Systems Vol. 2, No. 2, 2010
91
A collaborative approach of Business Intelligence systems
Gheorghe MATEI, PhD
Romanian Commercial Bank, Bucharest, Romania
[email protected]
Abstract: To succeed in the context of a global and dynamic economic environment,
companies must use all the information they have as efficiently as possible, in order to gain
competitive advantages and to consolidate their position on the market. To achieve these
goals, the companies must use modern informatics technologies for data acquiring, storing,
accessing and analysing. These technologies are to be integrated into innovative solutions,
such as Business Intelligence systems, which can help managers to better control the business
practices and processes, to improve the company’s performance and to conserve it’s
competitive advantages. This paper presents Business Intelligence systems and emphasizes
their collaborative feature.
Keywords: Business Intelligence, collaborative systems, competitive advantages,
decision making process, portal
1. Introduction
Information is stored anywhere in modern organizations: in transactional systems, data
warehouses, computer networks and personal computers. It is used to assist most of activities,
both operative, tactical or strategic. Nowadays, information supports all critical business
decisions. Most of organization consider that information is a strategic asset and act for the
permanent optimization of its management and usage in order to gain competitive advantages.
It is unanimously stated that all activities in an organization are based on information.
That is data acquiring, storing, transporting and processing. Information becomes a new
resource, a real asset of the new economy. The impact of information and communication
technologies (ITC) on business modifies the perception of information as a factor of
production. While in times past a business was defined as people, technologies and assets, in
the knowledge-based economy people, technologies, assets and information are taken into
consideration. The new economy is characterized by a greater impact of information resources
on production chain, the gradual disappearance of borders between products and services, and
the appearance of new business opportunities based on ITC (e-business, e-commerce, e-
banking etc.).
More and more organizations consider that their knowledge and competence are the
most valuable asset they have. In the new economy, ITC usage contributes to gaining
important benefits and competitive advantages, and determines organizations to become more
flexible and to adapt themselves to the changes in the business environment.
Any company’s success depends on how well it understands its business processes,
how efficient it manages its operations, and how well it knows its customers. To stay
competitive, companies must be able to identify their profitable customers, their business
trend, the most sold products, and the most productive distribution chains. Getting high
quality data is no longer a profit and loss issue, but a surviving on the market issue, a matter
of success or failure. Companies have understood that the future means analyses, reports,
forecasts, as well as real-time data management. A judicious data usage is not possible
Journal of Applied Collaborative Systems Vol. 2, No. 2, 2010
92
without a proper, powerful and robust information infrastructure, that allows usage of all
company’s data for making the best operative, tactical and strategic decisions. In today’s
context of a competitive economic environment which is permanently changing, the ability to
use information in an intelligent way, in order to cope with challenges and to benefit for
opportunities, represents an essential condition for any company that wants not only to stay on
the market, but also to consolidate its position. As information is the basis of all activities in a
company, this one must use information systems that can produce and manage it properly.
These systems must ensure the information availability for all users that need it in a timely
manner and in a proper format, provide to executive managers the possibility to view, analyse
and assess the company’s business processes, that is underlie their decision on an information
support based on Business Intelligence (BI) technology.
2. Short presentation of Business Intelligence technology
To achieve the above purposes, it is necessary to implement information solutions that
are able to offer to managers a complete and consistent view across the present status of the
organization, as well as projections on different periods of time, solutions that are able to
support the decision making process in order to adopt coherent and well-founded strategies. A
BI solution is one of the best solutions that can respond to these goals. A BI system is “an
information system with an open and flexible architecture that integrate innovative
technologies that are able to ensure a uniform and consistent storage of all data that are
relevant for their organization and the environment it is acting in, turn data into information
and knowledge, and use it judiciously use it in the decision making process, so that to
conduce to gaining competitive advantages against competition” [1].
BI systems emphasize data integration, analysis and mining, as BI aims to provide the
capability to access and analyse information and benefit on the competitive advantages
offered by these analyses.
BI has started up in order to respond managers’ demands for an efficient analysis of
company’s data, to better understand the business status, and to improve the decision making
process.
In the early ’90 it became an interest field for academia and, in the next ten
researching years, several technologies were transformed in well founded approaches
concerning data extract and processing.
BI solutions manage data storing in a different way than that used by transactional
systems. This way facilitates proactive searches and analyses of data from various and
isolated sources. A BI solution helps in generating and disseminating valuable information to
people that can use it for analyses needed in the decision making process.
Nowadays, BI got a greater importance for decision makers. Data acquisition – from
operations, customers, business partners and employees – was always an important action for
business running, but now the proactive usage of information has become essential. BI makes
a difference between reacting to problems and anticipating opportunities, and between
experience-based presumptions and proactive fact-based decisions [2].
BI systems integrate data from various sources, store it for a long period of time, so
they offer facilities of discovering trends and patterns that can be used for business value
improvement. This is ensured by improving communication and planning. As they are
flexible and scalable, these systems provide fast and efficient responds when the environment
is changing. They enable critical information to be duly accessed and eliminate unfounded
presumptions, ensuring a strong support for the decision making process.
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BI systems concur to efficiency and productivity increase, enabling collaboration
between all organizational structures and a global view over the entire organization, as well as
deploying role-based solutions, according to the requirements and tasks of each user. Users
become more efficient in their role, because each user can access the data he needs and the
appropriate tools.
3. Business Intelligence systems, as collaborative systems
Taking into consideration those presented above, BI can be defined as “a combination
of data, processes, tools and technologies that provide to managers valuable information that
support decisions made in order to increase the organization’s efficiency and profitability”
[3]. It allows users on any organizational level to access data, to interact with it and to analyse
it in order to run the business, to improve the performance, to discover new opportunities and
to operate efficiently. Such a system provides a global view over the entire organization,
enables data analyses from multiple points of view, and allow a fast feedback when the
business environment is changing.
A company’s success is based on information, and BI is a permanent process of data
acquiring, analysing and dissemination. Its main purpose is gaining and conserving
competitive advantages, preventing failures and exploitation of the opportunities that appear
on the market. BI systems create an intelligent business framework that enable delivery of
consistent and high quality information to all users, both inside and outside the organization.
They offer ways for network communication, enabling a fast dissemination of information,
and a better synchronization of all organizations activities. As a matter of fact, BI is a generic
term, un “umbrella” for a set of applications and technologies for data accessing and
analysing in order to support users to make better decisions.
BI systems help users to identify and solve their problems, to discover business risks
and opportunities, to anticipate market’s trends and to estimate competitors’ operation. They
allow a better understanding of business requirements, and a better management of customers
and suppliers relationship. Using such systems, managers can react faster to the problems that
appear, to estimate correctly the company’s position against competitors, so the company is
able to gain competitive advantages.
Although BI systems have evolved in order to respond to increasing analysing and
reporting requirements. From traditional reporting and analysing applications, now they are
powerful, friendly and faster tools designed for strategic decision making and performance
management. More stages can be identified in BI evolution, as shown in figure 1. Starting
with transactional applications that could deliver static reports regarding the company’s
activity, Management Information Systems (MIS) and Executive Information Systems (EIS)
were developed in the middle ’80. One of the major problems these systems cope with was
that they needed a lot of manual work for data conversion and load from data sources into the
repositories used by these systems. Starting with the early ’90, data warehouses and Extract,
Transform and Load (ETL) tools began to be largely used. The developing of new powerful
analytical instruments has led to an intensive usage of BI tools. The progress of these systems,
their functionality and capability improvement, is attended by a continuous approach to end-
users, systems becoming more friendly, reliable and easy to use.
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Fig. 1. Evolution of BI systems [4]
In [5] it is stated that three stages can be identified in BI systems’ evolution. First,
simple SQL-based reports were developed. The first BI systems were generating many
reports, and users had to spend a lot of time to analyse them in order to get the needed
answers. Applications, developed in a client/server architecture, were offering a fast access to
data, but it was rather difficult to use them, so they were used only by analysts and not by
managers and executive directors.
When data warehouses began to be used, the second BI systems generation started.
These repositories store consistent, present and historical data, both detailed and aggregated,
that are organizes simpler than in traditional databases, using a data model that is alike to real
life. Thus, the model can be better understood by managers and other non-IT users, and is
more adequate to analyses. Data warehouses were followed by data marts – specialized data
repositories that accelerated the delivery of information to managers with the aim of making
well founded decision. The On-Line Analytical Processing (OLAP) technology was
developed as an alternative to a dynamic access to complex data, as well as other dimentional
analysis tools that allow managers to analyse data from multiple perspectives and explore it in
order to discover hidden information.
Later, when it was clear that developing a data warehouse is just the first step in
building a BI solution, the third generation of these systems has started. The new systems
could offer a consolidated view over the entire organization, dynamic reports from various
departments, prediction capabilities, large and fast access at information on different
hierarchical levels. Though dimentional cubes and star schemas are still used, more complex
analytical solutions are largely used. These solutions use data mining techniques, statistical
methods and technologies that provide ad-hoc analysis capabilities. These technologies are
more and more used in operational workflows, and not only for strategic decision making.
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Nowadays, users have at their disposal a large set of powerful graphical equipments, used for
data processing, communication, collaboration and cooperation. BI solutions provide a large
functionality, from a simple data access to complex interaction and Web report generation.
The synthesis of the stages described above is shown in figure 2, where BI systems’
evolution presented based on their complexity and analytical capability.
Fig. 2. The generations in BI systems’s evolution
The need of intelligent information solutions grows as the company’s volume of data
becomes larger. As their name shows, BI solution enable an intelligent usage and analysis of
company’s business data. They help managers to better control the business practices and
processes, and duly analyse the company’s key performance indicators.
An essential requirement for the business growing and the improvement of company’s
position on the market is to better understand the business and factors that have both a
positive and, especially, a negative influence. Using the new information technologies,
companies learn what has happened in their business, why it has happened and what will
happen. At the same time, BI solutions contribute to the elimination of communication
barriers inside the company and enable decision making process on the basis of consistent
information and collaborative support [6].
Thus, BI has an essential role in consolidating company’s position on the market,
implementing the best practices, and business processes improvement. As a result, the
company can operate at a high quality level and become more competitive and efficient.
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4. Business Intelligence – an instrument for a collaborative decision making process
BI systems aims to provide to the decision making process accurate, consistent and
pertinent information. They make possible developing of evolved decision support systems,
capable to assist tactical and strategic decision making, operations and business processes
improvement. Thus, these systems contribute to profitability increasing and gaining
competitive advantages.
BI systems can provide historical reports, data analyses and alerts that signalize
problems and possible threats. Analysing historical information, managers can evaluate the
former activity. But it’s necessary to estimate the future evolution to, in order to anticipate
events and make the most appropriate decisions. BI systems join various activities within the
company and emphasize relationships that are difficult to be observed. So, BI overdraws the
borders of a stand alone activity and becomes an integral part of the way the business is
conducted.
It is necessary that BI solutions be available not only for managers, but also for a great
number of employees. At the same time, they must be able to be used by external users, such
as customers, business partners, and providers, and to take into consideration the requirements
of each user category.
Using all its data, making complex analyses, a company gets new information
concerning the business environment and its competitors. This information allows it to better
understand its customers’ behaviour and anticipate their requirements, to correctly manage
threats and risks, to identify opportunities to increase its revenues and reduce costs. Acquiring
and storing large volumes of historical data provide the capability to discover patterns and
factors that influence the company’s activity and to predict the future business evolution.
Without BI systems, selection and analysis of relevant information are hardly made, and
results are seldom incomplete and provided to late. Only companies that are using BI
technologies can cope successfully with the concurrent environment challenges [7].
Not too long ago, only few departments within a company were using BI applications.
Now this situation is changing rapidly, by developing and implementing new systems that
covers the entire functionality of the company. It is stated that usage of BI solutions
contributes to an open and active information culture [8]. At the same time, through these
systems BI advantages are offered to all the people involved in that business: employees,
shareholders, customers, providers and other business partners. As information is provided to
all interested people, they may state that a democracy of information is instituted at all the
levels inside the company and even outside it.
The decentralization of the decision making process has determined an increased need
of information into organization, and a portal is one of the ways through which a BI system
ensures its dissemination. Because not all users are interested by the same set of indicators,
which depends on every one’s level and requirements, a portal or another platform having the
same functionality has to be used.
A portal allows users to access the company’s intranet. It allows employees to access
and share the company’s data and information. At the same time, it provides capabilities such
as: classification of information that is available on intranet, a searching engine, news
concerning the organization, access at the email service and other information applications, a
document management solution, links to other sites, both inside and outside the company etc.
A portal is the interface between BI applications and users, an information space that
is well organized and easy to understand, where users find the tools and information they
need. It’s a Web-based secured interface that provides a single point for integrating all the
company’s information and accessing it. It also integrates the applications and services that
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are used by employees, business partners, providers and customers. As an example, figure 3
shows the portal of a banking company.
Fig. 3. The portalul of a banking company [9]
The portal in the figure above provides to bank’s customers the possibility to make a
large set of banking operations, in real time and in a secured environment (users identify
themselves through their codes and passwords). It also provide the possibility to access
detailed information concerning bank’s products and services, branch network, exchange
rates, links to the Web pages of bank’s subsidiaries, and other useful tools and information.
As a collaborative platform, a portal enables people, usually from remote locations, to
meet each other and to share information, to interact together and use specific tools in order to
achieve common goals. A portal is a component of organization’s information strategy and it
integrates several applications developed to solve business problems. These applications
ensure information consolidation, management and distribution both inside and outside the
company. Through Web services, not only applications are integrated into a portal, but also
data, business processes and people, ensuring in this way the communication and
collaboration between users, as well as the delivery of integrated business solutions. Portals
facilitate knowledge delivery, improvement of planning and product development processes,
and creation of more efficient functional relationship between groups of people [10]. They
offer a better view over the entire organization and help making more efficient decisions. All
these contribute to a better understanding of business processes and productivity increasing.
All portals are using the Web technology. It’s unanimously stated that the Internet has
influenced the way that organizations operate, as well as information applications nature. It
enables resources sharing and a rapid change of information with customers and business
partners. Schematically, these relations are shown in figure 4, that presents the connection
between a BI system and external users, through Internet.
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Fig. 4. Business Intelligence and Internet
As a conclusion, a portal is a platform through which various specialized tools are
made available to all users within the company. Together with ad-hoc query and analyse
tools, with dashboards and scorecards, they provide an easy, fast and flexible access to
information stored in various data repositories of the organization.
5. Business Intelligence system development
Nowadays, a company is appreciated not only in terms of its products and services,
but also of the information provided to its customers, employees and business partners. The
more information is offered, the more valuable the company is. The problem is that
information is not stored into a single place. Most of organizations have more information
systems, everyone having its own data sources and data presentation tools. Therefore,
information is managed by more departments or business units and is difficult to ensure an
efficient coordination of this activity. BI systems solve this problem and ensure that users get
the information they need, so they can make the best decisions.
A BI system consists of more information applications and technologies that allow
data extract, integration and consolidation from various systems within the company and
storing it into a single repository that enable information accessing and analysing and
knowledge dissemination to internal users, customers, providers, shareholders and other
interested people. The usage of such instruments allows users to focus on actions that have a
big impact and to duly identify the opportunities that can occur. As they provide on time
accurate, up to date and relevant information, BI solutions facilitate the business performance
management and help in making better decisions.
A BI system has to allow the integration with other collaborative systems and services,
such as email, Web etc. Such services increase the system’s value and certify that users will
use it. The system has to ensure data distribution and information sharing in the entire
organization, that is ensuring all users’ access to the information they need.
Building a BI system is based on a methodology that is different from that used at
transactional systems’ development. A prototype has to be built quickly, even if it doesn’t
respond to all the end-users’ requirements. The system will be developed by building
successive iterations, more and more complex and closer to the final version – the so called
“spiral” approach. Trying to build the system into a single iteration has a little chance to
succeed, because of very large financial and time resources that are needed.
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A BI system is an enterprise one that evolves together with the organization and is
permanently enhanced according to business users’ feedback. Because of its complexity and
differences to transactional systems, a BI system cannot be developed into a single iteration; it
is built in an iterative approach. In every iteration the stages presented in figure 5 are scanned;
a new version is built, as the system becomes more evolved and mature.
Fig. 5. A BI system developing cycle [1]
During the justification stage, the necessity for a new system is presented and
contended, the project scope is defined and the needed costs and expected benefits are
estimated.
During the business analysis stage, the problems are analysed in depth, a global
solution for solving them is established and a plan for the next activities is made.
During the system evaluation stage, the organization’s infrastructure, data that is
available, and hardware and software components are assessed.
During the architecture design stage, the new system’s technical structure is
established, so that it can respond to the aimed business requirements.
During the database design stage, the new system’s logical and physical data
structures are developed.
During the application design stage, instruments needed for extracting data from
source systems, its transformation and load into the data warehouse, interfaces for accessing
data and tools for its analysis are built.
During the application development stage, the instruments that were designed are
built, tested and validated.
During the implementation stage, the integration and testing of all the system’s
components are made, as well as the users’ training and the deployment of the new system.
During the maintenance stage, the system’s management and monitoring are made, in
order to ensure its running as the parameters were set on.
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Based on system’s monitoring observations, technological progress, users’ new
requirements, evolution of the economic, social and legislative environment, requirements for
future development are established.
The complexity of a BI system makes impossible its development into a single
iteration. The stages presented above are resumed into a new iteration, that will produce a
system’s new version, having enhanced capabilities. During this iterative process, a special
activity – the project management – is run on. During this permanent stage, an efficient
communication has to be established between functional departments and IT department.
6. Conclusions
Nowadays, organizations cope with much more challenges than ever before: fast
changes in a global, complex and competitive business environment, the change and
diversification of users’ requirements, the growing complexity of systems and technologies,
extended regulation and compliance requirements. Permanently, organizations generate, use,
store and share information with their customers, business partners and providers, At the same
time, they have to report periodically certain information to their shareholders and to various
regulation and control institutes.
To cope with these challenges and to stay on the market, organizations have to
implement new information systems, that can transform them into dynamic organizations,
capable to react quickly and efficiently to all changes in the business environment. As
information has become a strategic asset, capable to provide competitive advantages, the new
systems have to ensure the integration of all data the organization has and store it into
repositories that allow complex analyses, pertinent forecasts and decisions made to ensure a
permanent development of the business. Such systems stopped to be just an option, they have
become a necessity, am imperative of our times. Among them, a special class is constituted by
Business Intelligence systems, that are complex systems allowing the efficient integration of
information technologies, both the current and the future ones.
Business Intelligence (BI) is a generic concept that groups under the same umbrella
more instruments from business and information fields, instruments that are used in order to
transform data into information, information into decisions, and decisions into successful
actions.
At the beginning, BI systems were destined only to strategic level of organization’s
management. Nowadays, they are to be used by a lot of users, from all the hierarchical levels
of the organization. At the same time, they are open to external users to, such as shareholders,
customers, business partners and providers. Now, a company is judged not only depending of
the quality of its products and services, but also depending on the way it provides information
to users, both internal and external.
A BI system allows users on all the organization’s levels to access the data, to interact
with it and to analyse it in order to run the business, improve its performance, discover new
opportunities and act efficiently. Such a system offers a global view over the entire
organization, ensures the possibility to analyse the activity from multiple perspectives and
allows rapid reactions to the business environment changes. All these purposes are treated in a
collaborative manner, ensuring a single version of the truth for the entire organization.
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References
[1] M. Velicanu and Gh. Matei, Tehnologia Inteligenta Afacerii, Editura ASE, Bucuresti,
2010.
[2] M. Velicanu and Gh. Matei, “Utilizarea solu?iilor de Inteligen?a Afacerii în sistemul
bancar,” Revista Contabilitate ?i Informatic? de gestiune, No. 26, 2008.
[3] Gh. Matei and M. Velicanu, “Business Intelligence – philosophy of successful
companies,” Proceedings of the Fourth International Conference on Economic Cybernetic
Analysis “Global Crisis Effects on Developing Economies”, special session “Decision
Making Modeling and Risk Assessment”, ASE, Bucharest, May 22-23, 2009.
[4] N. Rasmussen, P. S. Goldy and P. O. Solli, Financial Business Intelligence: Trends,
Technology, Software Selection and Implementation, John Wiley and Sons, Inc., New York,
2002.
[5] M. Muntean, Ini?iere în tehnologia OLAP. Teorie ?i practic?, Editura ASE, Bucure?ti,
2004.
[6] M. Velicanu and Gh. Matei, “Databases versus Data Warehouses,” Proceedings of the
Eight International Conference on Informatics in Economy, Informatics in Knowledge
Society, ASE Publishing House, 2007.
[7] M. Velicanu and Gh. Matei, “Solu?ii informatice suport pentru afaceri inteligente,” Revista
Studii ?i cercet?ri de calcul economic ?i cibernetic? economic?, No. 1, 2008.
[8] J. Salmeron, „EIS data: findings from an evolutionary study,” Journal of Systems and
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[9] www.bcr.ro/bcrro
[10] M. Muntean, „Business Intelligence Solutions for Gaining Competitive Advantage,”
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Author
Gheorghe MATEI has graduated the Faculty of Planning and Economic
Cybernetics in 1978. He achieved the PhD in Economic Cybernetics and
Statistics in 2009, with a thesis on Business Intelligence systems in the
banking industry. After a long career in the IT department, now he is working
in the accounting and reporting department in Romanian Commercial Bank.
His fields of interest include Business Intelligence systems, data
warehousing, decision support systems. He is the author and co-author of
several articles in journal, international databases and proceedings of national and
international conferences in the mentioned domains.
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