Question
What is Business Intelligence (BI)? In a contemporary organisation, how can business intelligence can provide a competitive advantage?
Answer
Business Intelligence (BI) is a technology-driven process that involves the collection, integration, analysis, and presentation of business information. The primary goal of BI is to support better business decision-making by transforming raw data into meaningful insights. BI systems are designed to help organisations analyse data to improve decision-making, optimize operations, and gain a competitive edge in the market.
How Business Intelligence Provides a Competitive Advantage
Enhanced Decision-Making: BI systems enable organisations to make informed decisions by providing timely and accurate data analysis. This capability allows businesses to respond swiftly to market changes and customer needs, thereby gaining a competitive advantage (Peters et al., 2016; Olivos et al., 2023; Adewusi et al., 2024).
Improved Performance Measurement: By integrating BI systems with management control systems, organisations can enhance their performance measurement capabilities. This integration helps in better tracking of key performance indicators (KPIs) and aligning business strategies with operational goals, leading to improved organisational performance and competitive positioning (Peters et al., 2016; Afrianda, Zainal and Siswanti, 2023).
Strategic Alignment and Innovation: BI facilitates the alignment of business strategies with technological capabilities, promoting innovation and strategic growth. Organisations that effectively utilize BI can innovate their processes and products, staying ahead of competitors (, 2021; Shaik, 2019; Partearroyo and López, 2024).
Operational Efficiency: BI tools help streamline business operations by providing insights into process efficiencies and inefficiencies. This optimization of resources and processes leads to cost savings and improved productivity, which are crucial for maintaining a competitive edge (Vicente, Neves and Bernardo, 2024; Moussas, Hafiane and Achaba, 2024).
Data-Driven Culture: The adoption of BI fosters a data-driven culture within organisations, encouraging data-based decision-making at all levels. This cultural shift enhances the organisation’s ability to adapt to changes and leverage data for strategic advantage (Kutumela, Lubbe and Ohei, 2022; Afrianda, Zainal and Siswanti, 2023).
Integration with Advanced Technologies: BI systems, when integrated with advanced technologies like AI, IoT, and machine learning, can significantly enhance decision-making capabilities. This integration allows organisations to handle complex data environments and adapt to technological advancements, further strengthening their competitive position (Adewusi et al., 2024; Partearroyo and López, 2024).
In summary, Business Intelligence is a critical tool for contemporary organisations seeking to gain a competitive advantage. By enhancing decision-making, improving performance measurement, and fostering a data-driven culture, BI systems enable organisations to optimize their operations and strategically align their resources to meet market demands effectively.
References
Peters, M., Wieder, B., Sutton, S., & Wakefield, J., 2016. Business intelligence systems use in performance measurement capabilities: Implications for enhanced competitive advantage. Int. J. Account. Inf. Syst., 21, pp. 1-17. https://doi.org/10.1016/j.accinf.2016.03.001
, 2021. Role of Business Intelligence in Banking Sector for Achieving Competitive Advantage- An Empirical Analysis. Journal of Independent Studies and Research-Management, Social Sciences and Economics. https://doi.org/10.31384/jisrmsse/2021.19.1.6
Olivos, G., Espinoza, J., Aguilar, A., Ramos, J., & Hilario, C., 2023. Business intelligence as a competitive advantage in organisations: A systematic review of the literature between 2012-2022.. Proceedings of the 21th LACCEI International Multi-Conference for Engineering, Education and Technology (LACCEI 2023): “Leadership in Education and Innovation in Engineering in the Framework of Global Transformations: Integration and Alliances for Integral Development”. https://doi.org/10.18687/laccei2023.1.1.758
Vicente, J., Neves, L., & Bernardo, I., 2024. The potential of Logistics 4.0 technologies: a case study through business intelligence framing by applying the Delphi method. Frontiers in Artificial Intelligence, 7. https://doi.org/10.3389/frai.2024.1469958
Shaik, G., 2019. Transforming Business Operations the Role of Business Intelligence in Achieving Competitive Advantage. International Journal For Multidisciplinary Research. https://doi.org/10.36948/ijfmr.2019.v01i01.12139
Adewusi, A., Okoli, U., Adaga, E., Olorunsogo, T., Asuzu, O., & Daraojimba, D., 2024. BUSINESS INTELLIGENCE IN THE ERA OF BIG DATA: A REVIEW OF ANALYTICAL TOOLS AND COMPETITIVE ADVANTAGE. Computer Science & IT Research Journal. https://doi.org/10.51594/csitrj.v5i2.791
Kutumela, K., Lubbe, S., & Ohei, K., 2022. Investigating Business Intelligence as a Possible Differentiator for Administrative Competitive Edge. International Review of Management and Marketing. https://doi.org/10.32479/irmm.13307
Partearroyo, M., & López, A., 2024. Leveraging Business Intelligence Systems for Enhanced Corporate Competitiveness: Strategy and Evolution. Syst., 12, pp. 94. https://doi.org/10.3390/systems12030094
Afrianda, R., Zainal, V., & Siswanti, I., 2023. Business Intelligence Strategy for Company Business Development Using Online Analytical Processing. Indikator: Jurnal Ilmiah Manajemen dan Bisnis. https://doi.org/10.22441/indikator.v7i3.19171
Moussas, K., Hafiane, J., & Achaba, A., 2024. Business intelligence and its pivotal role in organisational performance: An exhaustive literature review. Journal of Autonomous Intelligence. https://doi.org/10.32629/jai.v7i4.1286
