Comparison of Business Intelligence and Data Analytics

The world of Data Science is growing at an exponential pace, but with all the buzz words and jargon being thrown around it is pretty easy to get confused. This article is aimed at clearing the air about the terms “Business Intelligence” and “Data Analytics”, which more often than not are used interchangeably.

What is Business Intelligence (BI) ?

Business Intelligence is a comprehensive term encompassing data analytics and other reporting tools that help in transforming historical data into actionable intelligence for the use of an organization’s business decisions. Business intelligence software has many benefits, especially powerful reporting and data analysis capabilities. Using BI’s versatile data visualization mechanisms, including real-time dashboards, professionals can generate intuitive, readable reports that contain relevant, actionable data.

“It’s information about the data itself. It’s not trying to do anything beyond telling a story about what the data is saying,” explains Beverly Wright, executive director of the Business Analytics Center at Georgia Tech’s Scheller College of Business.

What is Data Analytics (DA) ?

Data Analytics refers to the technologies, skills and practices for interactive and investigative analysis which are used to drawing out new, useful insights to improve business planning and boost future performance, through algorithms and mechanical processes. Data analytics software is used to explore and analyze data, and it utilizes statistical analysis, data mining and quantitative analysis to identify business trends. It then uses that data for predictive modeling, which can predict and prepare for the future business environment.

How does BI differ from DA?

While the two might sound similar on the surface,the difference between Business Intelligence and Data Analytics is clear: BI uses past and present data to optimize the current business operations for the present success of the organization. DA uses the past data, analyzes the present data to prepare companies for the future.

The major difference between BI and DA is that Data Analytics has predictive capabilities whereas BI helps in informed decision-making based on analysis of past data.

BI tells you what happened (descriptive analytics) in the past and why (diagnostic analytics) along with what is happening in the present. Compare this explanation of BI with the definition for DA, a technology-driven process by which software analyzes data to predict what will happen (predictive analytics) or what could happen by taking a certain approach (prescriptive analytics).

Final Overview

The info-graphic below presents a summary of the comparison between Business Intelligence and Data Analytics.