ISYS 650 Business Intelligence - Sfsu

separatesnottySoftware and s/w Development

Nov 25, 2013 (3 years and 7 months ago)

105 views

ISYS 650

Business Intelligence


David Chao

Fundamental Roles of IS in Business

Types of Information Systems


Operations Support Systems


Efficiently support day
-
to
-
day operations



Management Support Systems


Provide information and support for effective
decision making by managers



Strategic Information Systems


Help get a strategic advantage over customer





Transaction Processing Systems, TPS


Record and process business transactions


Any exchange of money or other benefits between two or
more parties


Order processing, purchasing


General ledger, accounts payable, accounts
receivable


L
arge amount of data, high processing speed, high
reliability, accuracy, and security (fault tolerant)


Data: internal, historical, detailed





Operations Support Systems




Current Trend in Operations Support
Systems


Enterprise Resources Planning ERP


for the internal world of a company



Customer Relationship Management CRM


for the external world of a company.

Enterprise Resources Planning, ERP


A company
-
wide, integrated, cross
-
functional system
used to manage and coordinate all the resources,
information, and functions of a business from shared
data bases.


Manufacturing


Transaction processing


Supply chain management


Accounting


Human resource


Major vendors:


SAP, Oracle, Microsoft

Customer Relationship Management, CRM


Front office operations:


Direct interaction with customers, e.g. phone calls, e
-
mail, online services etc.


Call Center


Sales Force Automation


tracks all contact that has been made with a given
customer, the purpose of the contact, and any follow up
that might be required.


Sales Intelligence


Cross
-
selling/Up
-
selling/Switch
-
selling


Example: SalesForce.Com



Types of Management Support Systems


Management Information Systems (MIS)


Reports and displays


Example: daily sales analysis reports


Decision Support Systems (DSS)


Interactive and ad hoc support


Example: a what
-
if analysis to determine where to spend
advertising dollars


Executive Information Systems (EIS)


Critical information for executives and managers


Example: easy access to actions of competitors

Management Information Systems


Facilitate management control by producing
summarized reports that compare actual
performance against planned performance on a
regular and recurring basis.


Management control: Ensuring that performance
meets established standards
.


Serve middle management


Provide reports on firm’s current performance,
based on data from TPS


Sample MIS Report

Sales Comparison


A DSS is a computerized system for helping
make decisions typically by modeling problems
and employing quantitative models for
solution analysis. A decision is a choice
between alternatives based on estimates of
the values of those alternatives.


Serve middle management


Support
nonroutine

decision making


E.g. What is impact on production schedule if December sales
doubled?


Often use external information as well from TPS and MIS

Decision support systems

C
omponents of DSS


D
atabase
: Current & Historical Data from
Many Sources
.



Internal and external data


Model base
: Collection of Mathematical &
Analytical Building Blocks


Interface for analysis
:
What
-

If Questions
;
visual
dashboard


DSS Components


An Executive Information System (EIS) is a type of
information system intended to facilitate and
support the information and decision
-
making needs
of senior executives by providing easy access to both
internal and external information relevant to
meeting the strategic goals of the organization. It is
commonly considered as a specialized form of a
Decision Support System.


Support senior management


Address
nonroutine

decisions requiring judgment, evaluation, and
insight


Incorporate data about external events (e.g. new tax laws or
competitors) as well as summarized information from internal MIS
and DSS

Executive support systems

Business Intelligence (BI)


BI is an evolution of decision support
concepts over time.


Meaning of EIS/DSS…


Then:

Executive Information System


Now:

Everybody’s Information System (BI)


BI systems are enhanced with additional
visualizations, alerts, and performance
measurement capabilities.

Recent Developments In Decision
Support Related Technologies


Data warehouse


Online Analytical Process, OLAP


Data visualization


Dashboard


Business Performance Management


Data mining

Definition of BI


BI is an umbrella term that combines architectures, tools,
databases, analytical tools, applications, and
methodologies.


BI a content
-
free expression, so it means different things
to different people.


BI's major objective is to enable easy access to data (and
models) to provide business managers with the ability to
conduct analysis.


BI helps
transform

data, to information (and knowledge),
to decisions and finally to action.


BI supports every level of business operation.

A Brief History of BI


The term BI was coined by the Gartner
Group in the mid
-
1990s


However, the concept is much older


1970s


MIS reporting


static/periodic reports


1980s


DSS, Executive Information Systems (EIS)


1990s


OLAP, dynamic, multidimensional data
warehouse, ad
-
hoc reporting



2005+


Inclusion of Artificial Intelligence and
Data/Text Mining capabilities; Web
-
based
Portals/Dashboards


2010s


Yet to be seen



The Evolution of BI Capabilities

Changing Business Environment &
Computerized Decision Support


Companies are moving aggressively to
computerized support of their operations =>
Business Intelligence


Business Pressures

Responses

Support
Model


Business pressures
result of today's competitive
business climate


Responses

to counter the pressures


Support

to better facilitate the process

Business Pressures

Responses

Support Model

Organizational Responses


Be Reactive, Anticipative, Adaptive, and
Proactive


Managers may take actions, such as:


Employing strategic planning.


Using new and innovative business models.


Restructuring business processes.


Participating in business alliances.


Improving corporate information systems.


Improving partnership relationships.


Encouraging innovation and creativity. …cont…>

Organizational Responses, continued


Improving customer service and relationships.


Moving to electronic commerce (e
-
commerce).


Using new IT to improve communication, data access
(discovery of information), and collaboration.


Responding quickly to competitors' actions (e.g., in
pricing, promotions, new products and services).


Automating many tasks of white
-
collar employees.


Automating certain decision processes.


Improving decision making by employing analytics.



Automated Decision System


A relatively new approach to supporting highly
structured decisions


An ADS is a rule
-
based system that provides a
solution to a repetitive managerial problem in a
specific area.


If only 70% of seats on a fight from LA to NY are sold
three days prior to departure, offer a discount of x %
to nonbusiness travelers.


If an applicant owns a house and makes over
$100,000 a year, offer a $10,000 credit line.


An ADS is event
-
driven alert:


Monitor credit card transactions for possible fraud


Offer financial services when customers make big
deposit.



Closing the Strategy Gap


One of the major objectives of computerized
decision support is to facilitate closing the gap
between the current performance of an
organization and its desired performance, as
expressed in its mission, objectives, and goals,
and the strategy to achieve them.

The Architecture of BI


A BI system has four major components:


a data warehouse
, with its source data


business analytics
, a collection of tools for
manipulating, mining, and analyzing the data in
the data warehouse;


business performance management
(BPM) for
monitoring and analyzing performance


a user interface
(e.g., dashboard)

A High
-
level Architecture of BI

Components in a BI Architecture


The
data warehouse
is the cornerstone of any
medium
-
to
-
large BI system.


Originally, the data warehouse included only historical
data that was organized and summarized, so end users
could easily view or manipulate it.


Today, some data warehouses include access to current
data as well, so they can provide real
-
time decision
support .


Business analytics
are the tools that help users
transform data into knowledge
(e.g., queries, data/text
mining tools, etc.).

Components in a BI Architecture


Business Performance Management
(BPM), which
is also referred to as corporate performance
management (CPM), is an emerging portfolio of
applications within the BI framework that provides
enterprises tools they need to better manage their
operations.


User Interface

(i.e., dashboards) provides a
comprehensive graphical/pictorial view of
corporate performance measures, trends, and
exceptions.

The Benefits of BI


1.Helps align the organization towards its key objectives
objectives


2.Enables faster and fact
-
based decision making


3.Combines multiple sources of data for decision making


4.Efficient collection and distribution of vital data and
statistics



“The right information at the right time and in the right place”

Intelligence and Espionage


Stealing corporate secrets, CIA, …


Intelligence vs. Espionage


Intelligence


The way that modern companies ethically and legally
organize themselves to glean as much as they can from
their customers, their business environment, their
stakeholders, their business processes, their
competitors, and other such sources of potentially
valuable information

Major BI Tools and Techniques


Tool categories


Data management


Reporting, status tracking


Visualization


Strategy and performance management


Business analytics


New/advanced tools/techniques to handle
massive data sets for knowledge discovery

Major BI Vendors


In recent years, the landscape of BI vendors has
changed


Cognos

acquired by IBM in 2008


IBM also acquired SPSS in 2009


Hyperion

acquired by Oracle in 2008


Business Objects
acquired by SAP in 2009


Microstrategy


May be the only independent large BI vendor


Others include Microsoft, SAS, Teradata (mostly
considered a DW vendor)