In the first part of this article, we described business intelligence, such as it was, in the days before computers and data processing were part of everyday life.
Time passed. Markets and populations grew. Manual data processing eventually got to be too slow. So automated data processing was introduced to speed up the pace at which business could be done. The first automated solutions were mechanical, such as cash registers and adding machines. Then along came electricity and computers, and the age of electronic data processing (EDP) dawned. Businesses could now process a much larger volume of transactions than before, making it easier to grow very rapidly.
But there was a downside. Once a company reaches a certain size it becomes too big for one person to manage off the top of his or her head as our general store owner did. There are employees to manage. There may be many stores in different parts of town, or in different countries. An item that was in stock just yesterday is suddenly gone from the shelf. With good bookkeeping you can figure out whether you’re making money or not. But you don’t necessarily know why, or even how, you’re making that money. Worst of all, you couldn’t get answers to these questions from the EDP systems. All you found out from them, if you found out anything, was that you did a whole bunch of transactions. There was a desperate need to get data out of these transaction-based systems and use them to make informed business decisions. As a matter of fact, the term “business intelligence” is often used interchangeably with the term “decision support.”
Next time: a story from the "real" world.
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