Business intelligence is fundamentally concerned with transforming your organization's operational data into an accessible store of high-value information and distributing the right information in the right way to the right people at the right time.
In both business and military operations, it's easy to see the correlation between the quality of intelligence and the success of operations: Those who comprehend and act quickly upon relevant facts have advantages over those who do not.
For this reason, intelligence has value to the business organization. Naturally, tools and technologies to collect and distribute information–or to improve its quality—will be embraced and employed quickly.
Two examples of business intelligence
Some believe business intelligence software to be the magic differentiator between great and mediocre companies. Consider this example.
The Big Bank had a target of acquiring 200,000 new accounts, a number that would require mailing offers to 10 million prospects using a 2 percent return rate, an expected rate for direct mail. Instead, the Big Bank used BI techniques to mail to a "refined" subset of all prospects yielding a response rate of 12 percent.
Instead of mailing to the 10 million prospects, BI required the bank to send mail to about 2 million, which generated the required new accounts. In addition to reducing cost, the average profitability of an acquired customer was three times higher than usual because data mining had targeted the customers whose needs best matched The Big Bank's services.