Business reporting and business intelligence (BI) are often referred to interchangeably, but the two are not the same. Both are designed to serve specific business purposes and should be viewed in terms of the purpose they serve.
Business reports give a snapshot of a specific business period and many factors must be considered when preparing these reports. Information for a business report is generated directly from data sources such as ERPs, CRMs and even spreadsheets.
In contrast, business intelligence allows greater flexibility and uses up to date, real-time data. Providing valuable insights into the business and identifying critical information such as the most profitable products, the best customers and will even suggest ways to attract new customers or to improve the lifetime value of existing ones.
Business reports provide a summary of how a business is tracking across any area of an organisation where performance is monitored and measured. Reports are created through the compilation and review of information from specific functional areas such as sales, finance or operations.
Business reporting tools help businesses connect to and draw from different data sources to develop report templates. Reporting tools generally use standard formats and fixed parameters, enabling staff to readily familiarise themselves with the report layout, the information it provides and what it means from an operational perspective.
Once generated, business reports are quite static in nature, but they do provide critical information specific to each functional area and serve the purpose of enabling staff to more efficiently meets daily tasks.
For example, manufacturing teams can run reports on current and upcoming production schedules to ensure they have the necessary inventory stock on hand to complete production runs. The reports enable staff to quickly access clear, straightforward information to understand what is needed to achieved daily tasks and as a result, improve overall productivity.
Business intelligence is a combination of the technology, tools and best practices that enable businesses to collect, integrate, analyse and present raw data into easy to understand, insightful and actionable business information.
In contrast to a static business report, BI tools are designed to explain why certain things happen, enabling companies to drill down into their data’s output through intuitive, easy-to-use dashboards.
The tools draw on multiple data sources to uncover otherwise unknown data relationships, suggesting steps to improve future performance. Enabling managers and business owners to explore new opportunities or address underlying issues and to optimise business planning and decision-making processes.
For example, instead of simply getting a snapshot of delivery performance, BI is used to analyse delivery performance over time against seasonal demand and customer experience. With this in-depth information, companies explore new ways to optimise delivery performance while minimising inventory waste and improving customer satisfaction.
Business intelligence for business reporting
Although reporting and business intelligence tools will both correlate data, create charts and generate reports, there are distinct differences in the information the software provides and in its value to your business.
A significant difference between the two is the detailed analysis that BI provides whereas traditional business reports offer a high-level summary that doesn’t require much detail. BI looks at extensive data relationships and can gather data from multiple sources to provide accurate, consistent information to identify trends that can inform strategic decision-making to improve performance across the organisation.
While business reports provide a snapshot in time, business intelligence uses historic and real-time data to identify what is happening in the business and provide analytical insight to suggest changes or improvements. Both are critical to business operations and BI reports can be used to support business reporting.