When I decided to write this blog post, I thought it would be a good idea to learn a bit about the history of Business Intelligence. I searched on the internet, and I found this page on Wikipedia. The term Business Intelligence as we know it today was coined by an IBM computer science researcher, Hans Peter Luhn, in 1958, who wrote a paper in the IBM Systems journal titled A Business Intelligence System as a specific process in data science. In the Objectives and principles section of his paper, Luhn defines the business as “a collection of activities carried on for whatever purpose, be it science, technology, commerce, industry, law, government, defense, et cetera.” and an intelligence system as “the communication facility serving the conduct of a business (in the broad sense)”. Then he refers to Webster’s dictionary’s definition of the word Intelligence as “the ability to apprehend the interrelationships of presented facts in such a way as to guide action towards a desired goal”.
It is fascinating to see how a fantastic idea in the past sets a concrete future that can help us have a better life. Isn’t it precisely what we do in our daily BI processes as Luhn described of a Business Intelligence System for the first time? How cool is that?
When we talk about the term BI today, we refer to a specific and scientific set of processes of transforming the raw data into valuable and understandable information for various business sectors (such as sales, inventory, law, etc…). These processes will help businesses to make data-driven decisions based on the existing hidden facts in the data.
Like everything else, the BI processes improved a lot during its life. I will try to make some sensible links between today’s BI Components and Power BI in this post.
Generic Components of Business Intelligence Solutions
Generally speaking, a BI solution contains various components and tools that may vary in different solutions depending on the business requirements, data culture and the organisation’s maturity in analytics. But the processes are very similar to the following:
- We usually have multiple source systems with different technologies containing the raw data, such as SQL Server, Excel, JSON, Parquet files etc…
- We integrate the raw data into a central repository to reduce the risk of making any interruptions to the source systems by constantly connecting to them. We usually load the data from the data sources into the central repository.
- We transform the data to optimise it for reporting and analytical purposes, and we load it into another storage. We aim to keep the historical data in this storage.
- We pre-aggregate the data into certain levels based on the business requirements and load the data into another storage. We usually do not keep the whole historical data in this storage; instead, we only keep the data required to be analysed or reported.
- We create reports and dashboards to turn the data into useful information
With the above processes in mind, a BI solution consists of the following components:
- Data Sources
- Data Warehouse/Data Mart(s)
- Extract, Transform and Load (ETL)
- Semantic Layer
- Data Visualisation
One of the main goals of running a BI project is to enable organisations to make data-driven decisions. An organisation might have multiple departments using various tools to collect the relevant data every day, such as sales, inventory, marketing, finance, health and safety etc.
The data generated by the business tools are stored somewhere using different technologies. A sales system might store the data in an Oracle database, while the finance system stores the data in a SQL Server database in the cloud. The finance team also generate some data stored in Excel files.
The data generated by different systems are the source for a BI solution.
We usually have multiple data sources contributing to the data analysis in real-world scenarios. To be able to analyse all the data sources, we require a mechanism to load the data into a central repository. The main reason for that is the business tools required to constantly store data in the underlying storage. Therefore, frequent connections to the source systems can put our production systems at risk of being unresponsive or performing poorly. The central repository where we store the data from various data sources is called Staging. We usually store the data in the staging with no or minor changes compared to the data in the data sources. Therefore, the quality of the data stored in the staging is usually low and requires cleansing in the subsequent phases of the data journey. In many BI solutions, we use Staging as a temporary environment, so we delete the Staging data regularly after it is successfully transferred to the next stage, the data warehouse or data marts.
If we want to indicate the data quality with colours, it is fair to say the data quality in staging is Bronze.
Data Warehouse/Data Mart(s)
As mentioned before, the data in the staging is not in its best shape and format. Multiple data sources disparately generate the data. So, analysing the data and creating reports on top of the data in staging would be challenging, time-consuming and expensive. So we require to find out the links between the data sources, cleanse, reshape and transform the data and make it more optimised for data analysis and reporting activities. We store the current and historical data in a data warehouse. So it is pretty normal to have hundreds of millions or even billions of rows of data over a long period. Depending on the overall architecture, the data warehouse might contain encapsulated business-specific data in a data mart or a collection of data marts. In data warehousing, we use different modelling approaches such as Star Schema. As mentioned earlier, one of the primary purposes of having a data warehouse is to keep the history of the data. This is a massive benefit of having a data warehouse, but this strength comes with a cost. As the volume of the data in the data warehouse grows, it makes it more expensive to analyse the data. The data quality in the data warehouse or data marts is Silver.
Extract, Transfrom and Load (ETL)
In the previous sections, we mentioned that we integrate the data from the data sources in the staging area, then we cleanse, reshape and transform the data and load it into a data warehouse. To do so, we follow a process called Extract, Transform and Load or, in short, ETL. As you can imagine, the ETL processes are usually pretty complex and expensive, but they are an essential part of every BI solution.Continue reading “Business Intelligence Components and How They Relate to Power BI”