Distinguishing business intelligence from related business concepts

Business intelligence is a term that is not heard that often. Instead, people use other terms, like sales forecasting, knowledge management, market research, or plain old common sense. There is much more to business intelligence than common sense, however, and it is very important to look at the issue more thoroughly. There are those who feel that business intelligence is a coined phrase for something that companies already use under a different name. There are also people who feel that it is something completely different, and there are those who simply do not know what business intelligence really is or whether there is any point to it. It appears, though, that the confusion over business intelligence is easy to sort out if one takes a look at the other terms that appear to be synonymous with it so that any myths about what it is or is not can be thoroughly debunked.

In order to do that, it is necessary to look at market research, common sense, sales forecasting, and knowledge management. Once those terms are understood more clearly it can be shown how they fit into the puzzle where business intelligence is concerned. Until that point it is easy to overlook them and misunderstand something because the definition of it is not that clear. This is what has happened with business intelligence, because it is a term that is so often confused with other things that are similar but yet not the same. When something like that becomes a problem it can confuse business owners who thought that they were doing something right and now feel as though they are doing things wrong. They might not actually be making a mistake - it is only that the terminology has changed.

Sales Forecasting and Knowledge Management

Sales forecasting and knowledge management are two areas that are important to address where business intelligence is concerned. Sales forecasting is very straightforward and takes into account how well the company has done in the past as a way to determine how well it will do in the future. This can be very scientific, however, and not as simplified as it actually sounds. There are a lot of issues that come into play where sales forecasting is concerned. It is not only about whether a sale was made in the past. Instead, other areas must be looked at. What the economy was doing at the time is important, because a recession like the current one could make a big difference in whether a company's sales stay strong or whether they fall off a bit. During a period of high growth where sales are concerned a company might think that it can hire more people and expand its operations. There is nothing at all wrong with doing these things, but if the company is planning on doing that based on money from future sales it is important that the forecast for future sales be as realistic as possible.

There are always unforeseen issues that could come up, but that is mostly where knowledge management ties into the issue of sales forecasting and works with it. Knowledge management is not so much a forecasting tool as a tool that will help to show how the forecast should be created. In other words, it is very important that a company have a clear understanding of where they have been and where they currently are so that they can forecast where they are going. No matter how long a company has been around there is knowledge of the past and the present that can be managed. Is what the company does closely tied to something else, like the stock market or disposable income? If so, there is more than just sales figures that need to be studied. Managing the knowledge that a company has and forecasting from that knowledge are important when it comes to having business intelligence.

Common Sense

Common sense, unfortunately, does not appear to be that common anymore. Instead, it seems as though many people ignore what they feel would be helpful or what they see someone else doing correctly in favor of other ideas. Some of these ideas are very new and innovative, but others are not as well received by those who are affected by them. In other words, there is a lack of common sense in many businesses today. They overlook it in favor of technologies that are supposed to make things easier but actually do not. They overlook it in favor of what a few customers have had to say instead of asking the majority. They also tend to look the other way when one of their ideas does not go over well. They assume that people will learn to like it, but instead they see their business shrinking and they cannot seem to decide what it is that they want to do about that.

In order to have any degree of business intelligence a person has to have common sense as well. The specifics of running a business are often technical, but they can also be very intuitive. If a person really hates something for what appears to be a valid reason, it is quite likely that others will hate it as well. With that being the case, he or she might not want to take that thing and market it to the public, or use it as an advertising gimmick, or involve the business in it in any way. On the other hand, a company does not have to like everything it sells. If the product is of good quality and the demand for it is high, that should be enough. The company is in business to make money, and one of the ways to do that is to be intelligent enough about business to realize that a company must give consumers what the consumers want, not what the business wants to give them. One cannot force someone to like a product, so the intelligent choice is to make the products that people already like.

Conclusion

In conclusion, it is easy to see that there are many components to running a successful business. A lot of these are set up into processes that business owners and workers use, like a well-oiled machine, to go through the day-to-day operations of the company and keep it working smoothly. All of the above-discussed areas are part of that, and they are all part of business intelligence. Most closely related is knowledge management, because that basically encompasses all different types of issues from sales forecasting to market research to the utilization of common sense in business. Knowledge management is a process, just like business intelligence, and many people will tell you that they are one and the same or that they run parallel to one another with only slight differences. It seems, however, that knowledge management is actually part of business intelligence, because there is more to being intelligent in business than only the management of knowledge.

Intuition, compassion, and other factors all play a part in how a business is and should be run. Some business owners have a lot more of these things than others do, and that makes them arguably more intelligent from a purely business standpoint. Anyone can take knowledge management, processes, and facts and figures and make those things work for them in the sense that they can create a business in the most basic sense. The heart and soul of a business, however, is what the owner and the employees put into that business, and that is more of an intuitive process than a statistical one. Both the management of knowledge and these other factors must be combined to ensure that a business enjoys success. Without one or the other the business is missing out, and the customers are missing out, as well. Sales will suffer with problems such as these and it is much better to invest in all areas of a business so that customers feel as though their purchases matter. That is the intelligent way to operate a business today.