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David Loshin - Business Intelligence The Savvy Managers Guide

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Following the footsteps of the first edition, the second edition of Business Intelligence is a full overview of what comprises business intelligence. It is intended to provide an introduction to the concepts to uncomplicate the learning process when implementing a business intelligence program. Over a relatively long lifetime (7 years), the current edition of book has received numerous accolades from across the industry for its straightforward introduction to both business and technical aspects of business intelligence. As an author, David Loshin has a distinct ability to translate challenging topics into a framework that is easily digestible by managers, business analysts, and technologists alike. In addition, his material has developed a following (such as the recent Master Data Management book) among practitioners and key figures in the industry (both analysts and vendors) and that magnifies our ability to convey the value of this book.

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Business Intelligence The Savvy Managers Guide Second Edition David Loshin - photo 1
Business Intelligence
The Savvy Managers Guide

Second Edition

David Loshin

Table of Contents Copyright Acquiring Editor Andrea Dierna Development - photo 2

Table of Contents
Copyright

Acquiring Editor: Andrea Dierna

Development Editor: Robyn Day

Project Manager: Danielle S. Miller

Designer: Greg Harris

Morgan Kaufmann is an imprint of Elsevier

225 Wyman Street, Waltham, MA 02451, USA

2013 Elsevier Inc. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system, without permission in writing from the publisher. Details on how to seek permission, further information about the Publishers permissions policies and our arrangements with organizations such as the Copyright Clearance Center and the Copyright Licensing Agency, can be found at our website: www.elsevier.com/permissions.

This book and the individual contributions contained in it are protected under copyright by the Publisher (other than as may be noted herein).

Notices

Knowledge and best practice in this field are constantly changing. As new research and experience broaden our understanding, changes in research methods or professional practices, may become necessary. Practitioners and researchers must always rely on their own experience and knowledge in evaluating and using any information or methods described herein. In using such information or methods they should be mindful of their own safety and the safety of others, including parties for whom they have a professional responsibility.

To the fullest extent of the law, neither the Publisher nor the authors, contributors, or editors, assume any liability for any injury and/or damage to persons or property as a matter of products liability, negligence or otherwise, or from any use or operation of any methods, products, instructions, or ideas contained in the material herein.

Library of Congress Cataloging-in-Publication Data

Loshin, David, 1963

Business intelligence : the savvy managers guide / David Loshin. 2nd ed.

p. cm.

ISBN 978-0-12-385889-4

1. Business intelligence. 2. Information technologyManagement. 3. Management information systems. I. Title.

HD38.7.L67 2012

658.472dc23

2012032793

British Library Cataloguing-in-Publication Data

A catalogue record for this book is available from the British Library.

ISBN: 978-0-12-385889-4

Printed in the United States of America

12 13 14 15 10 9 8 7 6 5 4 3 2 1

For information on all MK publications visit our website at wwwmkpcom - photo 3

For information on all MK publications visit our website at www.mkp.com

Preface
Introduction

It has been nearly ten years since I began the process of writing the first edition of this book; in some ways that span of years seems like an eternity, while in others, a blink of the eye. At that time, business intelligence (BI), business analytics, OLAP, and data mining were still maturing techniques. But one interesting observation, looking back at the text of the first edition: our objective in developing the book (titled Business Intelligence The Savvy Managers Guide) was to provide an overview of a collection of techniques that were gradually being adopted to help business understand ways to work better, and this objective anticipated the eventual democratization of the capabilities for repurposing information from many sources in ways that could lead to business value. At that time, I suggested that:

The boundary that divides business and technology is a fuzzy one, and this border erodes more and more as organizational managers recognize how integral knowledge and information management are to the bottom line. A natural development of this is the concept of business intelligence (BI), which (loosely defined) incorporates the tools, methods, and processes needed to transform data into actionable knowledge.

What I find curious about BI is that it is not just technology, nor is it just practices and methods. It is more a combination of the best of both the business world and the technical worldusing advanced algorithms and data management techniques to better implement the way a business works. But what prevents BI programs from being successful is precisely what forms the dividing line between business and technology. If we are moving toward a business environment where profits are driven by the exploitation of information, then it is critical for those who run, or, more properly, improve, the business to understand what kinds of value lie within a companys information and how to unlock that value and transform it into profits.

As I was completing my previous book, The Practitioners Guide to Data Quality Improvement, I was approached by Rick Adams at Morgan Kaufmann (MK) to revise the material in the first edition into a second edition, which I agreed to do because I thought that many things had changed in the ways that we guide our customers in implementing a BI program. I embarked on the set of tasks of updating the material in the book as well as adding material about what has changed in the industry and expanding sections and chapters about things and ideas that have changed over time. But what I found interesting is that as I reviewed the material, I was struck by how much of the first edition has remained relevant, which I believe has contributed to the long shelf-life of the original version.

And in turn, it seems that Morgan Kaufmanns interest in business intelligence has matured as well; I was invited to be the series editor for the business intelligence series, and (after some fits and starts) found a strong MK editor partner, Andrea Dierna. At the same time that I have been revising this book, Andrea and I have been diligently working at laying the foundation for expanding the catalog of books to guide data management and business intelligence professionals. A lot of the material that is introduced in this book is, or will be treated in much finer detail in the upcoming books of the series. This book is intended to be a cornerstone piece of that strategy. My overall goal is to paint a broad-brush overview of the objectives and practices for designing and deploying a BI program, and other books in the series will provide greater depth about many of the topics we discuss here.

What This Book Is

There is a logical sequence to understanding the basics of a BI program. This book will progress through that sequence, starting with the value of information, the mechanics of planning for success, data model infrastructure, and data preparation, followed by data analysis, integration, knowledge discovery, and finally the actual use of discovered knowledge. My goals for this book include:

Picture 4Providing a knowledge base for the decision maker to determine the value of integrating business intelligence, querying, and reporting technologies into the company;

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