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 How It Works
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Databases
A company has information - and lots of it - stored in various databases. Take a
national retail chain, for example, that sells everything from grills and patio
furniture to plastic utensils. The company is sure to have inventory, customer
information, data about past promotions, and sales numbers in various databases.
Though all this information may be scattered across multiple systems - and may
seem unrelated - business intelligence software has to bring it together and
help employees find important pieces of information and the correlation's among
them. For instance, when this retail chain plans a sales promotion, the
marketing department staff can analyze which products (right down to the colors)
are popular in which regions. And they can see whether any particular products
are commonly sold together: Perhaps customers buying blue plastic cups often buy
blue plastic plates as well.
Data Warehouse
The data in all the databases is brought together in the data warehouse. Here,
tables can be linked, and data cubes are formed. For instance, inventory
information is linked to sales numbers and customer databases, allowing for deep
analysis of information. Some data warehouses have a dynamic link to the
databases, while some are static. A dynamic link means that as data is added to
the inventory database, the data warehouse sees the changes and reflects them in
the queries being performed. A static connection, on the other hand, requires
the data warehouse to import information from the databases on a specific
command. In this situation, the data being queried may be out of sync.
Query
Deep analysis is carried out by performing multilayer queries. Because all the
databases are linked, you can search for what products a store has too much of.
You can then determine which of these products commonly sell with popular items,
based on previous sales. After planning a promotion to move stock, you can dig
deeper to see where this promotion would be most popular (and most profitable)
Reports
Once you have the answers, you'll want to share the numbers with managers at the
stores the promotion is planned for, so they can take a close look at the data
(perhaps they will know of a local event, such as a parade or festival) that
will drive sales for plastic plates. Though reports can be delivered
electronically over the Internet or an Intranet, methods vary. Some reports
provide a static view of the analysis - meaning the charts are there, but you
can't interact with them - and some link back to the original data, allowing you
to manipulate the numbers within the reports for further analysis.
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