In Analytics

Situational intelligence and business intelligence–they sound similar. They rely on computers. They help businesses make better decision. So what’s the difference?

Forrester Research defines the business intelligence market as “a set of methodologies, processes, architectures, and technologies that leverage the output of information management processes for analysis, reporting, performance management, and information delivery.”

Similarly, the Gartner Group defines business intelligence as “an umbrella term that includes the applications, infrastructure and tools, and best practices that enable access to and analysis of information to improve and optimize decisions and performance.”

What’s missing from these definitions that sets situational intelligence apart?

Situational intelligence includes the historical perspective delivered by traditional business intelligence, plus it takes into account the immediacy, diversity, and scale of the modern data landscape.

Specifically, situational intelligence adds four characteristics to business intelligence:

  • Multiple analyses: Situational intelligence extends traditional business intelligence by also analyzing operational data, location or geography, network relationships, and external factors such as social media, traffic, weather, and video. These additional analyses allow you to ask and answer a much broader range of questions about your business.
  • Pinpointing data: Situational intelligence locates the small set of anomalous data you need to attend to among the high variety and velocity of big data. Business intelligence excels at summarizing categories of data.
  • Immediacy: Situational Intelligence is focused as much on present, real-time and future performance as past performance, whereas business intelligence is mainly rooted in past performance and trends extrapolated on such performance.
  • Bi-directional: In addition to responding to user commands, situational intelligence often initiates interactions with users by highlighting anomalous data or risky situations through alerts, alarms and visualizations. Business intelligence is mainly driven by users requesting information through queries and reports.

An example might help clarify the distinction.

You can imagine that, as a business owner, you might want to view a report of product sales by ZIP code. This is a typical business intelligence activity.

Imagine now that you can also view a map showing the percent and amount of product sales by city, neighborhood, street, or any other ad-hoc geospatial area you specify. Maybe you want to identify the effect of severe storms on sales of your product at particular stores, view the impact of your social media initiatives in various neighborhoods, or make more accurate predictions about buying patterns at different stores to improve your production and distribution planning. These are just some of the ways situational intelligence extends beyond business intelligence to improve business.

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