Business Intelligence

UNIT I
Information Support System for Decision Making
An Information Support System for Decision Making (ISSDM) is a comprehensive
framework designed to provide organizations with the necessary information and tools to
make informed and effective decisions. This system leverages technology, data, and
analytical tools to support decision-makers at various levels within an organization.

1. Data Collection and Integration:

 Data Sources: Collects data from various sources, both internal and external to the
organization, including databases, sensors, market research, and more.
 Data Integration: Integrates data from disparate sources to create a unified and
consistent dataset.
2. Data Storage and Management:
 Database Systems: Utilizes robust database systems to store and manage large volumes
of structured and unstructured data.
 Data Warehousing: Implements data warehousing solutions to facilitate efficient
retrieval and analysis of historical data.
3. Data Analysis and Modeling:
 Analytical Tools: Employs statistical analysis, machine learning algorithms, and other
analytical tools to derive insights from the data.
 Predictive Modeling: Builds models to forecast trends, patterns, and potential outcomes
based on historical data.
4. Information Presentation and Visualization:
 Dashboards: Presents key performance indicators (KPIs) and relevant data in visually
intuitive dashboards.
 Visualization Tools: Uses charts, graphs, and other visualization techniques to
communicate complex information in a digestible manner.
5. Decision Support Systems (DSS):
 Scenario Analysis: Allows decision-makers to simulate different scenarios to understand
the potential impact of decisions.

An Early Framework for Decision Support System

One of the early frameworks for Decision Support Systems (DSS) is the classic framework
proposed by Michael S. Scott Morton in the 1970s.

This framework, known as the "Morton's Framework," provided a structured approach to

conceptualizing and implementing Decision Support Systems. The framework consists of four
components:

1. Data Management Subsystem:

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 Data Input: Involves the collection and input of relevant data into the system. This data
could be sourced from internal databases, external sources, or generated within the
system.
 Data Storage: Focuses on organizing and storing data efficiently. In early DSS, this often
involved the use of databases or file systems.
 Data Retrieval: Allows users to retrieve and access stored data as needed for decision-
making processes.
2. Model Management Subsystem:
 Model Base: Incorporates mathematical and analytical models that represent the decision-
making processes. These models could include financial models, optimization models,
and simulation models.
 Model Execution: Involves the application of models to the available data to generate
insights and support decision-making. This could include running simulations,
performing analyses, and generating forecasts.
 Model Evaluation: Focuses on assessing the validity and reliability of the models used
within the system.
3. User Interface Subsystem:
 User Dialog Management: Facilitates interaction between the user and the DSS. This
includes the design of user interfaces, query languages, and other tools that enable users
to input requests and receive information.
 Data Presentation: Involves presenting information to users in a comprehensible format.
This includes reports, charts, graphs, and other visualizations.
 User Training and Assistance: Addresses the need for training users to effectively use the
DSS and provides ongoing assistance as needed.
4. Knowledge-Based Subsystem:
 Knowledge Base: Contains domain-specific knowledge and expertise relevant to the
decision-making context. This may include rules, heuristics, and best practices.
 Inference Engine: Implements reasoning mechanisms to derive new knowledge from the
information available in the knowledge base.
 User Communication Subsystem: Facilitates communication between the user and the
knowledge-based subsystem, allowing users to seek advice or clarification.

The Morton's Framework was a pioneering model that laid the foundation for the development of
Decision Support Systems. It emphasized the integration of data, models, user interfaces, and
domain knowledge to assist decision-makers in making informed and effective decisions. While
technology and the complexity of decision-making have evolved since then, the fundamental
principles of early DSS frameworks continue to influence contemporary approaches to decision
support.
A Business Intelligence (BI) framework
A Business Intelligence (BI) framework is a systematic approach that organizations use to
collect, analyze, and present business information to support decision-making processes. Here's a
brief overview of a typical BI framework:

1. Data Sources:
 Identify and gather relevant data sources within and outside the organization.

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 Sources may include internal databases, external data feeds, spreadsheets, and more.
2. Data Extraction and Transformation:
 Extract data from diverse sources and transform it into a consistent format.
 Cleanse and preprocess data to ensure accuracy and reliability.
3. Data Warehouse:
 Store the transformed and cleaned data in a centralized data warehouse.
 Data warehousing allows for efficient storage, retrieval, and management of large
volumes of data.
4. Data Modeling:
 Create data models to represent the structure and relationships within the data.
 Dimensional modeling, star schemas, and snowflake schemas are common techniques.
5. Data Analysis:
 Utilize various analytical tools and techniques to explore patterns, trends, and insights
within the data.
 Perform statistical analysis, data mining, and other methods to extract valuable
information.
6. Reporting and Dashboards:
 Develop interactive dashboards and reports to visualize key performance indicators
(KPIs) and other relevant metrics.
 Provide stakeholders with intuitive tools to monitor and analyze business performance.
7. Query and Reporting Tools:
 Implement query and reporting tools that allow users to interact with the data.
 Ad-hoc querying and self-service reporting empower users to access information
independently.
8. Data Governance:
 Establish data governance policies and procedures to ensure data quality, security, and
compliance.
 Define roles and responsibilities for data management and access.
9. Performance Monitoring:
 Monitor the performance of BI systems and processes.
 Identify and address any bottlenecks or issues affecting the efficiency of data processing.
10. Continuous Improvement:
 Regularly assess the effectiveness of the BI framework and make improvements.
 Adapt to changing business needs and technological advancements.
11. User Training and Support:
 Provide training programs to ensure users can effectively leverage BI tools.
 Offer ongoing support to address user queries and challenges.
12. Integration with Business Processes:
 Integrate BI processes and insights into the broader organizational decision-making and
strategic planning.
 Align BI initiatives with overall business goals and objectives.

By implementing a comprehensive BI framework, organizations can gain valuable insights,

improve decision-making, and enhance overall business performance.

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Business Analytics overview

Business analytics involves the use of data analysis tools, techniques, and methodologies to gain
insights, make informed decisions, and optimize business processes. Here's a brief overview of
business analytics:

1. Data Collection:
 Gather relevant data from various sources, including internal databases, external
repositories, and real-time streams.
2. Data Cleaning and Preprocessing:
 Cleanse and preprocess data to ensure accuracy and eliminate inconsistencies.
 Handle missing data, outliers, and other issues that may impact analysis.
3. Descriptive Analytics:
 Summarize and describe historical data to understand past performance.
 Key techniques include data visualization, summary statistics, and trend analysis.
4. Diagnostic Analytics:
 Identify the root causes of past events or performance.
 Use techniques like drill-down analysis and data profiling to understand why certain
outcomes occurred.
5. Predictive Analytics:
 Employ statistical models and machine learning algorithms to forecast future trends and
outcomes.
 Predictive analytics helps in anticipating customer behavior, demand patterns, and other
future events.
6. Prescriptive Analytics:
 Recommend actions and strategies based on predictive models.
 Prescriptive analytics guides decision-makers on the best course of action to achieve
desired outcomes.
7. Data Visualization:
 Utilize charts, graphs, dashboards, and other visual tools to represent complex data in a
comprehensible and actionable format.
 Visualization enhances communication and understanding of data patterns.
8. Statistical Analysis:
 Apply statistical techniques to analyze relationships, correlations, and patterns within the
data.
 Hypothesis testing and regression analysis are common statistical methods.
9. Machine Learning:
 Employ machine learning algorithms to uncover insights from large datasets.
 Machine learning models can be used for classification, clustering, and predictive
modeling.
10. Optimization:
 Optimize business processes by identifying areas for improvement.
 Use analytics to streamline operations, reduce costs, and enhance efficiency.

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11. Decision Support:

 Provide decision-makers with actionable insights and recommendations.
 Business analytics empowers organizations to make data-driven decisions aligned with
their objectives.
12. Continuous Improvement:
 Regularly reassess and refine analytics models and strategies.
 Stay adaptable to changing business conditions and evolving data landscapes.

Business analytics is integral to strategic planning, risk management, and gaining a competitive
edge in the modern business landscape. It enables organizations to harness the power of data
to drive innovation, improve customer satisfaction, and achieve sustainable growth.

Big Data Analytics

Big Data analytics is a process used to extract meaningful insights, such as hidden patterns,
unknown correlations, market trends, and customer preferences. Big Data analytics provides
various advantages—it can be used for better decision making, preventing fraudulent activities,
among other things.

Why is big data analytics important?

In today’s world, Big Data analytics is fueling everything we do online—in every industry.

Take the music streaming platform Spotify for example. The company has nearly 96 million
users that generate a tremendous amount of data every day. Through this information, the cloud-
based platform automatically generates suggested songs—through a smart recommendation
engine—based on likes, shares, search history, and more. What enables this is the techniques,
tools, and frameworks that are a result of Big Data analytics.

If you are a Spotify user, then you must have come across the top recommendation section,
which is based on your likes, past history, and other things. Utilizing a recommendation engine
that leverages data filtering tools that collect data and then filter it using algorithms works. This
is what Spotify doe

What is Big Data?

Big Data is a massive amount of data sets that cannot be stored, processed, or analyzed using
traditional tools.

Today, there are millions of data sources that generate data at a very rapid rate. These data
sources are present across the world. Some of the largest sources of data are social media
platforms and networks. Let’s use Facebook as an example—it generates more than 500
terabytes of data every day. This data includes pictures, videos, messages, and more.

Data also exists in different formats, like structured data, semi-structured data, and unstructured
data. For example, in a regular Excel sheet, data is classified as structured data—with a definite

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format. In contrast, emails fall under semi-structured, and your pictures and videos fall under
unstructured data. All this data combined makes up Big Data.

Uses and Examples of Big Data Analytics

There are many different ways that Big Data analytics can be used in order to improve
businesses and organizations. Here are some examples:

 Using analytics to understand customer behavior in order to optimize the customer experience

 Predicting future trends in order to make better business decisions

 Improving marketing campaigns by understanding what works and what doesn't

 Increasing operational efficiency by understanding where bottlenecks are and how to fix them

 Detecting fraud and other forms of misuse sooner

These are just a few examples — the possibilities are really endless when it comes to Big Data
analytics. It all depends on how you want to use it in order to improve your business.

Benefits and Advantages of Big Data Analytics

1. Risk Management

Use Case: Banco de Oro, a Phillippine banking company, uses Big Data analytics to identify
fraudulent activities and discrepancies. The organization leverages it to narrow down a list of
suspects or root causes of problems.

2. Product Development and Innovations

Use Case: Rolls-Royce, one of the largest manufacturers of jet engines for airlines and armed
forces across the globe, uses Big Data analytics to analyze how efficient the engine designs are
and if there is any need for improvements.

3. Quicker and Better Decision Making Within Organizations

Use Case: Starbucks uses Big Data analytics to make strategic decisions. For example, the
company leverages it to decide if a particular location would be suitable for a new outlet or not.
They will analyze several different factors, such as population, demographics, accessibility of the
location, and more.

4. Improve Customer Experience

Use Case: Delta Air Lines uses Big Data analysis to improve customer experiences. They
monitor tweets to find out their customers’ experience regarding their journeys, delays, and so
on. The airline identifies negative tweets and does what’s necessary to remedy the situation. By

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publicly addressing these issues and offering solutions, it helps the airline build good customer
relations.

The Lifecycle Phases of Big Data Analytics

Now, let’s review how Big Data analytics works:

 Stage 1 - Business case evaluation - The Big Data analytics lifecycle begins with a business
case, which defines the reason and goal behind the analysis.

 Stage 2 - Identification of data - Here, a broad variety of data sources are identified.

 Stage 3 - Data filtering - All of the identified data from the previous stage is filtered here to
remove corrupt data.

 Stage 4 - Data extraction - Data that is not compatible with the tool is extracted and then
transformed into a compatible form.

 Stage 5 - Data aggregation - In this stage, data with the same fields across different datasets
are integrated.

 Stage 6 - Data analysis - Data is evaluated using analytical and statistical tools to discover
useful information.

 Stage 7 - Visualization of data - With tools like Tableau, Power BI, and QlikView, Big Data
analysts can produce graphic visualizations of the analysis.

 Stage 8 - Final analysis result - This is the last step of the Big Data analytics lifecycle, where
the final results of the analysis are made available to business stakeholders who will take
action.

Big Data Analytics Tools

Here are some of the key big data analytics tools :

 Hadoop - helps in storing and analyzing data

 MongoDB - used on datasets that change frequently

 Talend - used for data integration and management

 Cassandra - a distributed database used to handle chunks of data

 Spark - used for real-time processing and analyzing large amounts of data

 STORM - an open-source real-time computational system

 Kafka - a distributed streaming platform that is used for fault-tolerant storage

Artificial Intelligence (AI)

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Artificial Intelligence (AI)

In today's world, technology is growing very fast, and we are getting in touch with different new
technologies day by day.
Here, one of the booming g technologies of computer science is Artificial Intelligence which is
ready to create a new revolution in the world by making intelligent machines. The Artificial
Intelligence is now all around us. It is currently working with a variety of subfields, ranging
rang from
general to specific, such as self
self-driving
driving cars, playing chess, proving theorems, playing music,
Painting, etc.
AI holds a tendency to cause a machine to work as a human.

Artificial Intelligence is composed of two words Artificial and Intelligence,, where Artificial
defines "man-made," and intelligence defines "thinking power", hence AI means "a man-made
thinking power."
So, we can define AI as:

"It is a branch of computer science by which we can create intelligent machines which can
behave
have like a human, think like humans, and able to make decisions."
Artificial Intelligence exists when a machine can have human based skills such as learning,
reasoning, and solving problems
With Artificial Intelligence you do not need to preprogram a machine to do some work, despite
that you can create a machine with programmed algorithms which can work with own
intelligence, and that is the awesomeness of AI.

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History of Artificial Intelligence

Artificial Intelligence is not a new word and not a new technology for researchers. This
technology is much older than you would imagine. Even there are the myths of Mechanical men
in Ancient Greek and Egyptian Myths. Following are some milestones in the history of AI which
defines the journey from the AI generation to till date development.

Why Artificial Intelligence?

o With the help of AI, you can create such software or devices which can solve real-world
problems very easily and with accuracy such as health issues, marketing, traffic issues,
etc.

o With the help of AI, you can create your personal virtual Assistant, such as Cortana by
Microsoft, Google Assistant, Siri by Apple, etc.

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o With the help of AI, you can build such Robots which can work in an environment where
survival of humans can be at risk.

o AI opens a path for other new technologies, new devices, and new Opportunities.

Goals of Artificial Intelligence

Following are the main goals of Artificial Intelligence:

1. Replicate human intelligence

2. Solve Knowledge-intensive tasks

3. An intelligent connection of perception and action

4. Building a machine which can perform tasks that requires human intelligence such as:

o Proving a theorem

o Playing chess

o Plan some surgical operation

o Driving a car in traffic

5. Creating some system which can exhibit intelligent behavior, learn new things by itself,
demonstrate, explain, and can advise to its user.

What Comprises to Artificial Intelligence?

Artificial Intelligence is not just a part of computer science even it's so vast and requires lots of
other factors which can contribute to it. To create the AI first we should know that how
intelligence is composed, so the Intelligence is an intangible part of our brain which is a
combination of Reasoning, learning, problem-solving perception, language understanding,
etc.
To achieve the above factors for a machine or software Artificial Intelligence requires the
following discipline:

o Mathematics

o Biology

o Psychology

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o Sociology

o Computer Science

o Neurons Study

o Statistics

Advantages of Artificial Intelligence

Following are some main advantages of Artificial Intelligence:

o High Accuracy with less errors: AI machines or systems are prone to less errors and
high accuracy as it takes decisions as per pre-experience or information.

o High-Speed: AI systems can be of very high-speed and fast-decision making, because of

that AI systems can beat a chess champion in the Chess game.

o High reliability: AI machines are highly reliable and can perform the same action
multiple times with high accuracy.

o Useful for risky areas: AI machines can be helpful in situations such as defusing a
bomb, exploring the ocean floor, where to employ a human can be risky.

o Digital Assistant: AI can be very useful to provide digital assistant to the users such as
AI technology is currently used by various E-commerce websites to show the products as
per customer requirement.

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o Useful as a public utility: AI can be very useful for public utilities such as a self-driving
car which can make our journey safer and hassle-free, facial recognition for security
purpose, Natural language processing to communicate with the human in human-
language, etc.

Disadvantages of Artificial Intelligence

Every technology has some disadvantages, and the same goes for Artificial intelligence. Being so
advantageous technology still, it has some disadvantages which we need to keep in our mind
while creating an AI system. Following are the disadvantages of AI:

o High Cost: The hardware and software requirement of AI is very costly as it requires lots
of maintenance to meet current world requirements.

o Can't think out of the box: Even we are making smarter machines with AI, but still they
cannot work out of the box, as the robot will only do that work for which they are trained,
or programmed.

o No feelings and emotions: AI machines can be an outstanding performer, but still it does
not have the feeling so it cannot make any kind of emotional attachment with human, and
may sometime be harmful for users if the proper care is not taken.

o Increase dependency on machines: With the increment of technology, people are

getting more dependent on devices and hence they are losing their mental capabilities.

o No Original Creativity: As humans are so creative and can imagine some new ideas but
still AI machines cannot beat this power of human intelligence and cannot be creative and
imaginative.

Types of Artificial Intelligence:

Artificial Intelligence can be divided in various types, there are mainly two types of main
categorization which are based on capabilities and based on functionally of AI. Following is flow
diagram which explain the types of AI.

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AI type-1: Based on Capabilities

1. Weak AI or Narrow AI:

o Narrow AI is a type of AI which is able to perform a dedicated task with intelligence.The

most common and currently available AI is Narrow AI in the world of Artificial
Intelligence.

o Narrow AI cannot perform beyond its field or limitations, as it is only trained for one
specific task. Hence it is also termed as weak AI. Narrow AI can fail in unpredictable
ways if it goes beyond its limits.

o Apple Siri a good example of Narrow AI, but it operates with a limited pre-defined range
of functions.

o IBM's Watson supercomputer also comes under Narrow AI, as it uses an Expert system
approach combined with Machine learning and natural language processing.

o Some Examples of Narrow AI are playing chess, purchasing suggestions on e-commerce

site, self-driving cars, speech recognition, and image recognition.

2. General AI:

o General AI is a type of intelligence which could perform any intellectual task with
efficiency like a human.

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o The idea behind the general AI to make such a system which could be smarter and think
like a human by its own.

o Currently, there is no such system exist which could come under general AI and can
perform any task as perfect as a human.

o The worldwide researchers are now focused on developing machines with General AI.

o As systems with general AI are still under research, and it will take lots of efforts and
time to develop such systems.

3. Super AI:

o Super AI is a level of Intelligence of Systems at which machines could surpass human

intelligence, and can perform any task better than human with cognitive properties. It is
an outcome of general AI.

o Some key characteristics of strong AI include capability include the ability to think, to
reason,solve the puzzle, make judgments, plan, learn, and communicate by its own.

o Super AI is still a hypothetical concept of Artificial Intelligence. Development of such

systems in real is still world changing task.

Artificial Intelligence type-2: Based on functionality

1. Reactive Machines

o Purely reactive machines are the most basic types of Artificial Intelligence.

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o Such AI systems do not store memories or past experiences for future actions.

o These machines only focus on current scenarios and react on it as per possible best
action.

o IBM's Deep Blue system is an example of reactive machines.

o Google's AlphaGo is also an example of reactive machines.

2. Limited Memory

o Limited memory machines can store past experiences or some data for a short period of
time.

o These machines can use stored data for a limited time period only.

o Self-driving cars are one of the best examples of Limited Memory systems. These cars
can store recent speed of nearby cars, the distance of other cars, speed limit, and other
information to navigate the road.

3. Theory of Mind

o Theory of Mind AI should understand the human emotions, people, beliefs, and be able
to interact socially like humans.

o This type of AI machines are still not developed, but researchers are making lots of
efforts and improvement for developing such AI machines.

4. Self-Awareness

o Self-awareness AI is the future of Artificial Intelligence. These machines will be super

intelligent, and will have their own consciousness, sentiments, and self-awareness.

o These machines will be smarter than human mind.

o Self-Awareness AI does not exist in reality still and it is a hypothetical concept.

Top AI Companies by Industry
 Cloud AI Companies
 Health Care AI Companies
 Vehicle/Transportation AI Companies

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 Security AI Companies
 E-Commerce AI Companies
 Financial AI Companies
 Education AI Companies
 Manufacturing/Engineering AI Companies
 Energy/Environment AI Companies
 Robotics AI Companies
 Entertainment AI Companies

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