KM Component 49 – Analytics and Business Intelligence

Analytics and business intelligence can enable making good decisions, acting efficiently, optimizing processes, inventing and innovating, communicating effectively, influencing people, and improving business performance. 

This post will define the key terms, list the key benefits, and connect them to KM strategy and knowledge flow.

Definitions

Analytics: discovery and communication of meaningful patterns in data and text

Business Intelligence (BI): the ability for an organization to take all its capabilities and convert them into knowledge; includes data mining, data visualization, big data, databases, data warehouses, and data lakes

Text analytics: analyzing unstructured text, extracting relevant information, and transforming it into useful business intelligence

Data mining: finding anomalies, patterns, and correlations within large data sets to predict outcomes

Data visualization: any effort to help people understand the significance of data by placing it in a visual context; patterns, trends and correlations that might go undetected in text-based data can be exposed and recognized easier with data visualization software

Big data: extremely large data sets that may be analyzed computationally to reveal patterns, trends, and associations, especially relating to human behavior and interactions

Databases: collections of information organized for easy access, management, and updating

Data warehouses: copies of transaction data specifically structured for querying and reporting

Data lakes: storage repository that holds a vast amount of raw data in its native format, including structured, semi-structured, and unstructured data; the data structure and requirements are not defined until the data is needed

Data science: an interdisciplinary field about scientific methods, processes, and systems to extract insights from data in various forms, either structured or unstructured; a concept to unify statistics, data analysis and their related methods in order to understand and analyze actual phenomena with data; employs techniques and theories drawn from many fields within the broad areas of mathematics, statistics, information science, and computer science, in particular from machine learning, classification, cluster analysis, data mining, databases, and visualization

Uses and Benefits

Analytics and business intelligence can enable making good decisions, acting efficiently, optimizing processes, inventing and innovating, communicating effectively, influencing customer buying, and improving business performance. Here are examples of each:

Making good decisions: Decide on the optimal locations for stores, restaurants, manufacturing plants, and other business sites.

Acting efficiently: Compare alternative courses of action and their expected impact, and use the results to take the best action.

Optimizing processes: Use data visualization to show the bottlenecks in the current process and take steps to eliminate them.

Inventing and innovating: Sports teams develop innovative strategies, for example, shifting infielders for each batter in baseball based on their past tendencies.

Communicating effectively: Visually convey details of the current state and the desired future state to support the management of change.

Influencing customer purchases: When customers shop online, suggest other products to buy — for example, customers who bought this book also bought these other books.

Improving business performance: Decide when and where to invest, divest, merge, acquire, and maintain the status quo.

Analytics and BI in KM Strategy and Knowledge Flow

KM Strategy: Analyze

Reviewing collected information can reveal patterns, trends, or tendencies that can be exploited, expanded, or corrected. Distilling data to extract the essence leads to discovering new ideas and learning how to improve.

Knowledge Flow: Discovery

In most organizations there are information systems, transaction processing applications, and databases that are used to run the business. There is data captured in these systems that can be used to distill trends, answer queries, and support decision making. And this can be done without the need to capture data redundantly. For example, if customer purchase information is entered into the order processing system, it can be fed to a data warehouse for use by all departments.

Content from Lucidea

• Analytics
• KM Conversation: The Uses and Benefits of Analytics and Business Intelligence
• Webinar Recording: The Uses and Benefits of Analytics and Business Intelligence