Now that we have a better understanding of what BI is, let’s take a brief look at its origins. This examination will help show where BI fits with other parts of the IT portfolio, such as enterprise transactional applications like enterprise requirements planning (ERP), and will help differentiate BI uses from other IT uses. It’s also important to understand that enabling BI technologies are mature, low-risk technologies that have been used successfully by major companies for more than a decade.
Although recently the term BI has become one of the new IT buzzwords, the organizational quest for BI is not new. Approaches to BI have evolved over decades of technological innovation and management experience with IT. Two early examples of BI are :
Although recently the term BI has become one of the new IT buzzwords, the organizational quest for BI is not new. Approaches to BI have evolved over decades of technological innovation and management experience with IT. Two early examples of BI are :
- Decision support systems (DSSs): Since the 1970s and 1980s, businesses have used business information and structured business analysis to tackle complex business decisions. Examples include revenue optimization models in asset-intensive businesses such as the airline industry, the hotel industry, and the logistics industry, as well as logistics network optimization techniques used in industries that face complex distribution challenges. DSSs range from sophisticated, customized analytical tools running on mainframe computers to spreadsheet-based products running on personal computers. DSSs vary enormously in price and sophistication and are application-specific. Accordingly, they have not systematically addressed integration and delivery of business information and business analyses to support the range of BI opportunities available to companies today.
- Executive information systems (EISs): These were an early attempt to deliver the business information and business analyses to support management planning and control activities. Principally used on mainframes and designed only for use by upper management, these systems were expensive and inflexible. As BI applications and high-performance ITs have come to market, EIS applications have been replaced and extended by BI applications such as scorecards, dashboards, performance management, and other “analytical applications.” These applications combine business information and business analyses to provide custom-built and/or packaged BI solutions.