Business Intelligence & Cloud Computing

Business Intelligence

The following excerpt comes from an email from IBM promoting their Cognos BI software: On a smarter planet, the businesses that outperform will be driven by analytics. And IBM Cognos 10 will be leading the revolution from making decisions simply based on historical data to predicting the future. BI has replaced the term decision support systems (DSS) A DSS is a computer system at the management level of an organization that combines data, sophisticated analytical models, and user-friendly software to support semi-structured and unstructured decision making.

Business Intelligence Definitions

Piccoli BI is the ability to gather and make sense of information about your business. It encompasses the set of techniques, processes, and technologies designed to enable managers to gain superior insight and understanding of their business and thus make better decisions. Watson (2009, 391) Business intelligence (BI) is a broad category of applications, technologies, and processes for gathering, storing, accessing, and analyzing data to help business users make better decisions.

Other Definitions of BI

From Valacich & Schneider (2009, 312) BI is the use of information systems to gather and analyze information from internal and external sources in order to make better business decisions. Business intelligence also refers to the information gained from the use of such systems. The need for BI is so that businesses can engage in (1) continuous planning and (2) respond to threats and opportunities. Laudon & Laudon (2010, 226) define BI as: Once data have been captured and organized in data warehouses and data marts, they are available for further analysis. A series of tools enables users to analyze these data to see new patterns, relationships, and insights that are useful for guiding decision making. These tools for consolidating, analyzing, and providing access to vast amounts of data to help users make better business decisions are often referred to as business intelligence (BI).
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Key Performance Indicators

Watson (2009) also discusses the phrase key performance indicators or KPI. In 1979, Rockart introduced the concept of critical success factors (CSF). CSFs are critical measures that indicate a firm is on track to be successful. CSFs have been critical components in executive information systems. Today the dashboards and scorecards that display how a firm performs have their origins in Rockarts concept of CSF. KPIs are similar to the vital signs a doctor looks at when examining a patient to determine the health of the patient

Aspects of BI

A great deal of BI activity is related to data mining Classification Clustering Associations Forecasting BI also includes querying and report generation BI also includes Online Analytic Processing (OLAP); Excel pivot tables on steroids

Aspects of BI

A great deal of BI activity is related to data mining Classification Clustering Associations Forecasting BI also includes querying and report generation BI also includes Online Analytic Processing (OLAP); Excel pivot tables on steroids

BI and Business Analytics (BA)

From Simcar (2009) The burgeoning field of BI/BA is the latest battlefield for corporations seeking to gain competitive advantage, or simply to survive in a fiercely competitive business environment. The focus is on collecting data in real-time about a firms many business processes (such as filling orders, hiring employees, or purchasing supplies) and keeping track of exactly how the firm is performing in these areas. Managers can react quickly to rapidly changing circumstances as the need arises. This is the field of descriptive analytics [or core analytics]. The most sophisticated firms are attempting to go beyond this and determine the effects of potential changes in their business processes. This is the field of predictive analytics. It allows firms to anticipate customer needs, create opportunities and beat their competition (293).

Core Analytics and Predictive Analytics

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The Content Basis of Business Analytics

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BI References

Davenport, T. H. (2006). Competing on Analytics. Harvard Business Review, 84(1), 98-107. Laudon, K. C., & Laudon, J. P. (2010). Managing Information Systems (11th ed). Pearson Education Inc.: Upper Saddle River, NJ. Piccoli, G. (2008). Information Systems for Managers. John Wiley & Sons, Inc.: Hoboken, NJ. Sircar, S. (2009). Business Intelligence in the Business Curriculum. Communications of the Association for Information Systems, 24, 289-302. Valacich, J., & Schneider, C. (2009). Information Systems Today. Prentice-Hall: Upper Saddle River, NJ. Watson, H. J. (2009). Tutorial: Business Intelligence Past, Present, and Future. Communications of the Association for Information Systems, 25, 487-510.

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Cloud Computing

Cloud computing refers to a model of computing where firms and individuals obtain computing power and software applications over the Internet, rather than purchasing their own hardware and software. The cloud can be thought of as a synonym for the Internet. Examples of cloud computing Software as a service (SaaS) Utility computing Platform as a service Managed service providers

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SaaS and Utility Computing

Software as a Service (SaaS): In this application, a company provides customers access to software/applications on a subscription basis. The customer does not have to invest in hardware or software to run the application. The provider maintains the application and the hardware. Data resides on the providers computers. The companies that provide this service are called Application Service Providers (ASPs). Providing enterprise applications has been a typical service. The reduced cost of this option makes enterprise applications such as ERP, SCM, and CRM available to small and medium sized firms. Google Apps and Zoho Office are examples of this type of cloud computing. Utility computing is a variant of cloud computing where a customer can purchase their computing services (e.g., processing power, storage, etc.) from remote providers and pay only for the amount of computing power they actually use (or can be billed on a subscription basis). Amazon, Sun, and IBM offer this type of cloud computing.

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Platform as a Service and Managed Service Providers

Platform as a service is a variant of SaaS where a company delivers a development environment as a service. The customer builds an application that can run on the providers infrastructure and is delivered to the companys users via the Internet from the providers computers. Examples of this are Force.com, Yahoo Pipes, and the Google App Engine. Managed service providers (MSP) take on some of the day-to-day related IT management responsibilities of a firm as a way to improve a firms effectiveness and efficiency with respect to day-to-day operations. The person or organization who owns or has direct oversight of the organization or system being managed is referred to as the offer-er, client, or customer. The person or organization that accepts and provides the managed service is regarded as the service provider. Typical types of services are virus scanning services for email, managed security services (SecureWorks, IBM, and Verizon), and anti-spam services (Postini).

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Strategic Implications of Cloud Computing

Positives Cloud computing can reduce infrastructure expenses relating to hardware, software, and people You only pay for what you use Negatives You dont control the infrastructure Privacy and security considerations Internet access must be reliable and service provider must be competent Not advisable for firms in the strategic quadrant of the strategic grid In the future, firms will most likely use a combination of cloud computing and their own infrastructure