ERP and Business Intelligence: the importance of integration

What is Business Intelligence?

By Business Intelligence we mean the set of processes, models, tools and, of course, people employed to collect and organize all the wealth of data generated by a Business Valuations in UAE. Business Intelligence deals with analyzing and processing these data to transform them into information that is significant for the strategic development of the company. Therefore, the task of Business Intelligence is not only to validate and process the data but also to take care of their representation to facilitate their understanding by the entire corporate team so that they can be used as decision-making leverage.

The role of ERP in Business Intelligence

The bigger the company, the larger the amount of data produced daily: recording and managing them manually is obviously unthinkable; for this there are Data Analytics software that reach maximum effectiveness when they are integrated into the company information system.

The new generation Customized ERP Software's in Dubai already provides Data Analytics, Business Intelligence and Data Visualization functions: this generates a great advantage as it avoids data loss and duplication and saves a lot of time otherwise spent on import, control and validation. Indeed, one of the key aspects of Business Intelligence is automation of all those analysis processes that can be delegated to the software, to allow the team to focus on the interpretation of the outputs obtained.

It is clear, therefore, that the central node of Business Intelligence is the ability of the information system to manage as much data as possible, integrating and recording inputs relating to resources, processes and activities on a unique database to monitor all production processes in real time, identifying critical issues and margins for improvement. The goal of Business Intelligence, in fact, is precisely to manage all data flows to transform them into information, representations and strategic inputs for decision-making processes.

Integrating a Business Intelligence system directly into the ERP allows you to set performance indicators and customized measurement parameters according to the organizational structure and business objectives, obtaining a high accuracy of the information output and a greater possibility of discovering cause-effect relationships which often escape when the data sources are separate.

A few examples

Let's see some examples of areas of application of Business Intelligence with respect to ERP modules:

SALES

Analysis of sales by product, product category, geographical area, time span
Comparative analysis between these classifications
Profit margin analysis

CRM

Customer analysis by product, product category, geographical area, time frame
Purchase behavior analysis
Comparative analyzes between these aspects

PRODUCTION PLANNING

Analysis of material requirements
Counting of hours worked and hourly staff cost per hour
Analysis of the production capacity of the individual departments
Comparison between these data

WAREHOUSE MANAGEMENT

Analysis of stocks and rotation of goods
Analysis of shipments and warehouse movements
Comparison

If we correlate all these data, it is easy to understand how the concept of Business Intelligence is at the basis of the optimization of business processes in every aspect: from production planning according to a logic of reduction of waste that we have talked about on other occasions up to marketing strategies.

Why start from ERP to implement a Business Intelligence system?

In order for the Business Intelligence processes to take action, the data preparation phase must be completed, which for a manufacturing company can be a really complicated operation to manage. It means:

identify the data available
determine how they will be measured
establish their business value
define how to aggregate them
Clean them to ensure their reliability, eliminating any disturbing elements.

If the data source for Business Intelligence is the ERP itself, you understand that this process moves much further upstream and, at the same time, simplifies, provided that it is approached with the right method.

Define business goals

First of all, it is necessary to clearly define the business objectives at the macro level , that is, relating to the entire structure, and at the micro level , that is, relating to the single process, long-term and short-term. Clearly identifying the objectives is the first step in defining the parameters to measure the success of your strategy: you cannot establish how much you miss the goal if you do not know what your goal is. In this way, the Key Performance Indices are identified , the performance indicators that guide the processing and transformation of raw data.

Take into account the needs of each department

Each Company Incorporation Services in Dubai has its own vision of the work: if this is not reconciled by a coherent and shared corporate culture, it is likely that misunderstandings and frictions are created which make it more difficult to establish the performance indicators we have just talked about. Sometimes different departments do not even share the same jargon, the same technical vocabulary: it is therefore important to work on internal communication before starting the implementation of a Business Intelligence system.

Seek advice from a data analyst

A Data Analytics expert will assist you in successfully completing the three points described above, but will also advise you on the method to deal with the internal change process . In fact, every time an IT system is part of an organization, a training phase that ferries users in the transition to the new working method cannot be ignored.

About This Author

aaacas
Ahemad Alagbari Chartered Accountants
Joined: August 24th, 2019

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