Data Analysis and Business Intelligence: What's the Difference?

Data analysis is an essential tool for business intelligence (BI). Learn more about the differences between these two concepts.

Data Analysis and Business Intelligence: What's the Difference?

Unstructured data is essential for business intelligence and analysis. By understanding how to access, analyze, and use this type of data, businesses can better manage their operations and stay competitive in changing market conditions. Business intelligence tools can include a variety of software tools and other systems, such as spreadsheets, online analytical processing, reporting software, business activity monitoring software, and data mining software. Additionally, some experts argue that predictive and statistical tools used in business analysis are also part of business intelligence.

Data analysis is a unique tool within business intelligence (BI) that is used to collect, clean, inspect, transform, store, model, and query data. Its objective is to produce ideas that serve as a basis for decision-making in business and other fields such as science, government or education. Data analysis focuses on the essential aspects of the analysis process and is not exclusively a business intelligence tool. However, it is often used in a business context and incorporates presentation functions that are also common to BI.

Data analysis has four main objectives: to identify patterns in data; to make predictions; to generate insights; and to create databases. It is about converting raw data into useful information and mastering the technical tools needed to do so. While data analysis is widely used in business, it works quite well without business data. It is simply a useful tool that companies have adopted. Business intelligence depends heavily on data analysis.

However, it is not the same as business intelligence. The latter uses a variety of strategies and tools, of which data analysis is just one of them. In fact, data analysis is probably the most fundamental business intelligence tool out there. Although the lines between the two are often blurred, it's important to remember that data analysis focuses on answering specific questions while business intelligence involves tasks such as strategy management, persuasion and communication, leadership, commercial awareness and other areas related to the business environment. Data analysts are mainly technical and mathematical specialists who are capable of coding algorithms, performing statistical analysis and coding with programming languages such as Python.

Meanwhile, business intelligence analysts focus primarily on the operational side of things. In this post we have tried to demystify the complex differences between data analysis and business intelligence.