ASSIGNMENT SEM-3

MI0036 BUSINESS INTELLIGENCE & TOOLS

Q.1 a. List the factors responsible for the increasing importance of BI in organisations.
b. What are the obstacles in Implementing BI in Organisations?

ANS

Factors Responsible for the Increasing Importance of Business Intelligence in

Organisations
The increasing importance of BI is due to various factors, namely, technological
advancement, competitive market and need for quick reflexes. Let's elaborate on these
factors.
Technological advancement: The magnificent increase in electronic connectivity between
people and organisations through the Internet and Intranet has generated an explosion of data
volumes. The development in the storage capabilities has also supported this exponential rise
in the amount of data. In addition to this, hardware with high processing speeds help in
carrying out complicated calculations quickly. Availability of more and better calculated data
can help in crafting better decisions, if handled properly.
Competitive market: Decision making is a crucial task in this competitive business
environment. For the success of a business, decision makers need to perform comparative
analysis of its business processes, metrics and dimensions, such as quality, cost and time.
Many organisations work globally, in multiple industries and in collaboration with other
industries as well.
Need for quick reflexes: Financial integration has made the market highly volatile. Being
extremely competitive, any opportunity that arises in the market closes very soon. The
decision makers need to take extreme care in these matters. They have limited time to react
and respond to such situations.
Obstacles in Implementing BI in Organisations
BI helps organisations to overcome obstacles and respond to the needs that result from
advances in technology and new requirements. For this, the BI solution providers or
implementers will need to implement next-generation analytics and address changes in the
context of data and its usage. The effective use of BI demands a sound ecosystem of
management practices and policies.

Definitions: BI cannot be implemented successfully in the absence of a clear definition about

perspective goals. Initially, only 10 to 20 KPIs should be chosen to create standards and
gradually be increased to reflect the overall performances.
Data Governance (DG): This is another major factor that poses a big hurdle in the overall
functioning of the BI solutions. DG refers to the overall handling of the data in terms of
availability, integrity, usability, backup and security.
Enterprise Architecture (EA): It describes the structure of an organisation. EA focuses on
the fact that the system should be well planned and described from the abstract level to a
detailed level.
Requirement analysis: It is an extremely important step and poses a major hindrance, if not
identified correctly. The understanding of BI requirement its purpose and the end userscan
reveal the type of information needed and its frequency.
Q.2 a. Discuss the contribution of business analytics in strategy management
b. How is CRM linked to business intelligence?
Contribution of business analytics in strategy management
A good financial performance is the result of better business outcomes. To achieve these
outcomes, organisations need to develop and manage multiple, interconnected business
strategies. BA solutions give an actionable business forecast that can guide business strategies
and technologies to provide timely and accurate financial results. Although, the
business user teams may only have an apparent understanding of BA technologies, they are
expected to highlight the requirements of the business. They should help in the prioritisation
of projects and promote BA efforts among the business users.
BA solutions have an important role to play in achieving better financial performance. Some
of the key benefits are listed as follows:
Improve the decision-making process (e.g. quality and relevancy of decisions)
Speed up the decision-making process
Attain better alignment of resources with strategies
Realise cost efficiencies
Respond to users needs on a timely basis
Achieve enhanced competitiveness
Accomplish a unified view of the overall information
Collaborate operational and financial strategies
Increase the growing revenues
Share information with various departments
Maintain regulatory compliance
Share information with external users and other stakeholders (e.g. customers and
suppliers)

How is CRM linked to business intelligence

The following points depict how CRM is linked to BI:
Guidance: BI often gives advice to the CRM department. For example, if a sales manager
needs to determine how to sell a specific product to a particular customer, he/she can make
use of the BI tool such as CRM to revise CRM guidelines that provide assistance to sale
representatives in communicating with the customers.
Documentation: Sales managers document CRM data and combine it with their BI data. For
example, a sales manager can collect data about different types of customers who purchased
certain products and services.
Illustration of the software and practices of sales managers: CRM usually illustrates the
software and practices of sales managers to keep track of customer user accounts.
Information regarding the requirements, sales histories, feedback and contacts of users might
be covered in the CRM accounts.
Inter-dependence: BI and CRM are dependent on one another as sales professionals often
require information that is based on many interdepartmental activities.
Launch of advertising and marketing campaigns: Another useful association between
CRM and BI facilitates advertising and marketing department to launch successful
campaigns.
Generate new intelligence: Many professionals comprehend another important association
between CRM and BI in the sense that CRM data can be used to generate new intelligence.
Q. 3 Explain the data mining process in detail
ANS

DM includes a number of operations, each one of which is aided by a variety of techniques,

such as decision trees, rule-based induction, neural networks and conceptual clustering. The
derived results are evaluated repeatedly over the developed models to minimise the
occurrence of potential errors. In the real world applications, knowledge extraction involves
Collaborative use of several data mining techniques and operations. Data mining consists of
the following six steps.
Data is pulled from the data warehouse and sent to the ETL layer, where E stands for
extract, i.e., pulled, T for transform and L for load.
Based on the query generated, the data is explored for the matching patterns.
The output is then forwarded to the analyst, who prepares a new set of questions to
elaborate on certain aspects of the findings or to refine the search. This is an iterative search
process.
Once the analyst is through with the task, the final report generated by the data mining
system is forwarded for human interpretation.
The data is then represented in a functional format, such as a report, graph or a table.
Finally, it is passed on to the decision makers to take an appropriate
action based on such findings.
Q.4 Relate between BI tools and relationship marketing strategy with
ANS
Relationship between BI tools and relationship marketing strategy

BI analytic tools, when used within a relationship marketing strategy, can regularly review
business performance trends and suggest actionable recommendations, enabling the
organisation to consistently optimise the strategic marketing approach. In this way,

organisations investing in a BI analytic tool benefit from measurable and interactive

marketing initiatives that strengthen customer relationships, advance client intelligence, and
Maximise Return on Investment (ROI).
The BI analytic tool would facilitate in identifying:
An organisations most profitable clients
The top clients of a specific product/service
The best methods and channels with which to maintain customer loyalty in the most costeffective manner
The strategy to deliver the right amount of incentives and opportunities to keep clients
committed to the organisation
The most effective marketing tactics based on specific marketing goals
Clients who can be the main candidates for cross-promotion of other products or services
Clients who demonstrate a high probability and potential for multiple purchases of different
products and services
The clients who respond strongly to new offerings and ranking them as early adopters,
opinion leaders and/or trial enthusiasts BI analytic tools utilise a data-driven analytic
approach for helping business organisations to gain a unique understanding of the value level
of the client. These tools also help in understanding the value potential over time and
according to the respective segment.
Such intelligence insights allow companies to build and maintain stronger, direct
relationships with their clients. Such relationships can be used to migrate clients lifetime
values from less profitable to more profitable. Moreover, it helps organisations to forecast
different client behaviours in order to try and change undesirable behaviour or catalyse
desirable behaviour. Other organisations use BI analytic tools to monitor client defection,
consumer longevity, up-sell and cross-sell opportunities, likelihood to respond, best customer
acquisition, and much more. In fact, the only possible limitation is probably the business
organisations level of creative thinking.
An example of BI tool: Elegant BI for CRM
The Elegant BI solution is a customer relationship management BI solution that provides a
single source, and an integrated view of enterprise data from various sources and allows
every user to create views, dashboards and key KPIs to fulfil the requirements of their role,
department and function. Therefore, every user is busy achieving strategic, operational and
tactical goals, and can provide suitable support for constant success in getting new clients,
retaining already existing clients and selling new products and services.
Q.5 What are the main features of a financial reporting system

ANS
The following are the main features of a financial reporting system:
Drag-and-drop report builder: This feature helps in creating sophisticated reports and
analysing them with ease. To generate a report, you need to select the desired items from a
menu, drag them onto a graphical workspace and choose appropriate formatting options.
Choice of dimensions in rows and columns: This feature enables you to easily design your
report. You just need to choose the right value of various dimensions, such as business unit,
department, region, product, customer, projects, metrics, assumptions and time period, and
drag them into the relevant rows and columns of the report builder.
Filters: These limit the data displayed in a report by filtering it by any dimension, such as a
specific sales territory, business unit or sales channel.
Parameters: These minimise the number of reports generated to record all the facts and
conclusions. Create a prompt for customising the report by giving users options to select the
appropriate time period, department, region, etc. The user security feature ensures that reports
can be run only for dimensions allowed for each user.
Annotations: This feature allows you to include collaborative explanations, comments and
questions on reports. You can include an ongoing thread that receives input from more than
one user or refer to specific data in a report or the entire report. These annotations can be
viewed either within the body of the report or as footnotes.
Automatic security/streamlined set of reports: This feature allows you to create a set of
standard reports for a group of users (e.g. P&L or Sales Detail). It ensures that specific
reports are visible only to the users authorised to access them.
Drill-down: This allows users to analyse the underlying data that contributes to a specific
total or rollup value through real-time drill-down capabilities.
Multi-version variance reporting: With this feature, you can compare actual, budget and
forecast data and display variances as values and/or percentages.
Graphs and charts: In addition to tabular formats, this feature facilitates viewing of reports
as graphs or charts.
Output formats: This feature helps to generate reports in different formats, such as HTML,
PDF or Excel.
Q.6 Discuss the various critical challenges that need to be overcome for BI to succeed
within an organisation
ANS

Business success is achieved with BI through easily accessible information. This access can
be best achieved with the help of precise and timely insight into the finances and customers
of an organisation as well as the state of the market. The true indicator of success in business
is when BI results in more profitability. Organisations achieve success in their business by
performing the following actions:
Making better decisions with confidence and speed
Optimising business operations
Shortening the product development cycle
Anticipating new opportunities and maximising the value of existing product lines
Focusing on marketing and overall supply chain with improved supplier and customer

relationship
For BI to succeed, the organisation must understand and analyse the challenges that come in
BI implementation. Usually, BI projects fail because of the following reasons:
Failure to understand that BI projects are cross-organisational business initiatives; they
differ from general stand-alone solutions.
Uninvolved business sponsors who take less interest in an enterprise BI implementation
Uninterested or unavailable business representatives
Lack of availability of skilled staff to work with BI tools
Absence of iterative development methods
Lack of methodology in the development of BI projects
Lack of clarity and analysis of business needs
Impact of dirty data on business profitability
Ignorance of the necessity and importance of metadata and its use
Reliance on unrelated tools and methods

Now, let us examine these challenges one by one in detail in the following section.
Cross-organisational collaboration
Usually, business initiatives focus on a particular area of business or on a limited set of
products. As a result of this narrow focus, organisations could not analyse the impact of the
data generated by the project and business operations.

Business sponsors
Strong business sponsors believe in the BI projects value and remove the obstacles to
champion it. A BI project requires support from a committed business sponsor within an
organisation. It generally fails to find that support.
Dedicated business representation
BI projects are technical in nature instead of being business-oriented. Thereason behind this
limitation is that most BI projects are run by IT project managers who have little knowledge
of business.
Availability of skilled team members
BI projects are significantly different from other projects as they lack concrete, well-defined
deliverables. Moreover, the technical and business skills required to implement a BI
application somewhat differ from other operational Online Transaction Processing (OLTP)
projects.
BI application development methodology
To succeed, BI projects must follow a plan with well-defined objectives and methodologies.