Overview of Business Intelligence

Transcription

1 ACC 626 IT Assurance & Computer Assisted Auditing Overview of Business Intelligence S. Jiang June 18, 2013

2 Introduction - What is Business Intelligence? Business intelligence is a catchphrase that has been thrown around in the boardrooms of many companies, but what is business intelligence? Solomon Negash referenced that [business intelligence] as a term replaced decision support, executive information systems, and management information systems i, Intelligence is defined by the Merriam-Webster dictionary as the ability to learn or understand or to deal with new situations or the ability to apply knowledge to manipulate one s environment ii. From this definition, one can infer that business intelligence allows businesses to learn and adapt to their competitive environment. Jaklic, Popovic and Tuck sources many definitions available for business intelligence in their paper. They explain that the abundance of definitions is created by various software vendors to suit their products iii. Some definitions of business intelligence include: [t]he process of gathering and analyzing internal and external business information, an architecture and a collection of integrated operational as well as decisionsupport applications and databases that provide the business community easy access to business data, and an organized and systematic process by which organizations acquire, analyze, and disseminate information from both internal and external information sources significant for their business activities and for decisionmaking iv. From these definitions, we can infer that the term business intelligence does not relate to a particular piece of information but rather a systematic process that businesses employ to gather data to learn about their competitive environment and support decision making process. Today s economic environment is changing at an ever increasing pace, having the ability to adapt is vital to a business s success. As new products are delivered onto the market, customer preference can quickly shift. It is up to the businesses to identify consumer trends and react accordingly. This is why business intelligence is at the core of every firm s operations. Businesses no longer have the luxury to produce what they want, but rather their products are dictated by consumer demand. As a result, businesses must constantly check its surroundings and identify risks and opportunities as they arise. To start, organizations must be able to collect information based on its own operations and compare to its industry peers. However, possessing the ability to collect information does not automatically infer intelligence; intelligence is rather the ability to interpret information and make the right decision. Jaklic, Popovic and Tuck emphasizes that the essential element of BI is the understanding of what is happening within an organization and its business environment, as well as appropriate action-taking for achieving organizational goals v. i Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 177. ii Intelligence. (n.d.). In Merriam-Webster online. Retrieved from iii Jaklic, J., Popovic, A., & Turk, T. (2010). Conceptual Model of Business Value of Business intelligence Systems. Management: Journal Of Contemporary Management Issues, 15(1), 7. iv Jaklic, J., Popovic, A., & Turk, T. (2010). Conceptual Model of Business Value of Business intelligence Systems. Management: Journal Of Contemporary Management Issues, 15(1), 7. v Jaklic, J., Popovic, A., & Turk, T. (2010). Conceptual Model of Business Value of Business intelligence Systems. Management: Journal Of Contemporary Management Issues, 15(1), 8. 1

3 Business Intelligence Systems After interpreting the meaning of business intelligence, the next question that comes to mind is how companies attain such intelligence. The answer to the question is simple, but the answer to the problem is complex. Business intelligence systems are integrated information gathering systems that can quickly help users interpret data and allow for better decision making process. Solomon explains that business intelligence systems combine data with analytical tools to present information in a more useful manner to decision makers vi. These systems enable users to predict market trends, analyze competitor actions and impact of business decisions. The top four strategic use of business intelligence are: corporate performance management, monitoring business activity, packaged applications for specific operations, and management reporting vii. Business intelligence systems are the answer companies are looking for. In fact, business intelligence and business intelligence systems are so intertwined that two terms are often used interchangeably. The impact and use of business intelligence systems are widespread and pervasive. In a survey of the state of business analytics by Bloomberg Businessweek, 97 percent of companies with revenues exceeding $100 million were found to use some form of business analytics viii. These systems are so powerful that they have one of the greatest potential in differentiation from competitors ix. Business intelligence systems pull information from many different sources such as data warehouses, online-data processing, customer relationship management, and enterprise resource planning and convert the data into useful information x. Such systems allow full integration across all functionalities of an organization and increase overall productivity and efficiency. With the abundance of information available that are now made available to the entity, management can use business intelligence systems to create forecasts, perform what if analysis, and produce ad-hoc reports xi. The business intelligence technology currently adopted in the industry can be considered to be BI&A 1.0, where data are mostly structured, collected through various legacy systems, and stored in relational database management systems xii. CCS cites that the following eight capabilities are considered to be BI&A 1.0: reporting, dashboards, ad hoc query, search-based online analytical processing, interactive vi Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 178. vii Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 179. viii Chen H., Chiang, R. L., & Storey, V. C. (2012). Business Intelligence and Analytics: From Big Data to Big Impact. MIS Quarterly, 36(4), ix POPESCU, S. (2012). Business Intelligence Solutions - a Way of General Improvement of Efficiency and Effectiveness. Review Of International Comparative Management / Revista De Management Comparat International, 13(1), 88. x Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 179. xi Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 180. xii Chen H., Chiang, R. L., & Storey, V. C. (2012). Business Intelligence and Analytics: From Big Data to Big Impact. MIS Quarterly, 36(4),

4 visualization, scorecards, predicative modeling, and data mining xiii. Businesses leverage these BI capabilities to navigate the market and provide real time feedback to important decision makers. Ad hoc query and search-based OLAP allow users to quickly obtain operational information and provide various ways of organizing data output. Scorecards and dashboards provide executives with real-time feedback of their companies performance. Using operational data, business intelligence systems can perform predicative modeling and generate interactive visualization to assist decision making process. Negash illustrated in his journal article that a business intelligence system is composed of many different components. Some of these components can be an analytic system by themselves. This fact further illustrates just how powerful and complex business intelligence systems are. All individual systems combine together to provide users with operational data on company level. Management use these information to stay current on company production schedule, obtain real-time financial performance, perform environmental scanning and forecast future trends. These analytic systems are tailored to a company s specific needs whether it be supply chain management, marketing, or customer relationship. But the act of combining these standalone solutions to work in sync creates much bigger value for the company and create a true business intelligence system. Based on Negash s illustration, the architecture of a business intelligence system consists of all IT systems that an organization has employed. To further illustrate the various components of a business intelligence system, this report examines essential components listed in Solomon s article and explains what each component achieves: Data warehouse forms the foundation of any IT system. Its function is to store operational data in a useful manner for the organization. It takes data from various operational systems such as ERP, sales and supply chain management system and transforms the data into a more useable format before storing it into the database. The information stored can then be pulled from the database using multiple applications and allow users to access the information they need. Supply chain management system monitors a company s entire production process from acquiring raw materials to work-in-progress inventory, and eventually to finished goods and point of sale. It manages the entire logistics of the company s products by managing inventory, directing transportation, and forecasting future demand needs. Customer relationship management system dictates how the company interact with its customers. It can perform many functions such as measuring effectiveness of marketing campaigns, record customer traffic and preference, and identify consumer base and trends. The most recognizable feature of a CRM system would be its loyalty rewards program where it rewards customers for their continued business. Enterprise resource planning system pulls information every department to present real-time status of the company. It is the central theme of a business intelligence system as it encompasses all areas of the xiii Chen H., Chiang, R. L., & Storey, V. C. (2012). Business Intelligence and Analytics: From Big Data to Big Impact. MIS Quarterly, 36(4),

5 company s functions and provide seamless integration of the functions. It, in turn, allows the company to improve its efficiency, understand the competitive environment, and make better decisions. Again, the difference between business intelligence systems and IT systems become indistinguishable as IT systems themselves are intelligent systems. All IT components can be combine together to create a powerful analytical tool that can be used to differentiate the company from its competitors. Impact of Business Intelligence Systems on Audit The world was simpler for accountants before there were computers xiv. These large IT systems offer a variety of functionalities across the organization and have changed the way companies operate. As IT systems become widely implemented, accountants must understand the pervasive impact of IT systems and its risks. After Enron, there has been a resurgent interest in how to positively influence the quality of information system auditing xv. New standards have been put in place as information system audits in the U.S. are required to adhere to quality control standards such as those of the Public Company Auditing Oversight Board (PCAOB), the American Institute of Certified Public Accountants (AICP), and the Institute of Internal Auditors (IIA) xvi. In the U.S. external auditors need to form an opinion about the quality of the internal audit function before deciding the extent to which it can be relied upon xvii. IT systems have become items of particular interest to auditors as they need to assess the effectiveness of the controls in an organization. Given the increasing level of complexity of these IT systems, many practice frameworks have been available for auditors as a point of reference. Both the COBIT and the COSO framework are examples of sources that are available to the auditors and can be used as a source of best practice guidance xviii where key IT controls are described. The Information Systems Audit and Control Association (ISACA) also published IS Standards, Guidelines, and Procedures for Auditing and Control Professionals to provide auditing professionals with guidelines and suggestions for audit procedures. Information systems changed the way companies are audited. Internal controls in most IT systems are a combination of both automated and manual processes, affecting all five of the components of internal control the control environment, risk assessment, control activities, information and communication and monitoring xix. Boritz lists some significant factors that are impacting change in audit approach: systems may xiv Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, xv Capps, C. & Wright, M. (2012). Auditor Independence and Internal Information Systems Audit Quality. Business Studies Journal, 4(2), 64. xvi Capps, C. & Wright, M. (2012). Auditor Independence and Internal Information Systems Audit Quality. Business Studies Journal, 4(2), 65. xvii Capps, C. & Wright, M. (2012). Auditor Independence and Internal Information Systems Audit Quality. Business Studies Journal, 4(2), 65. xviii Amacei, C., Popa, M., & Toma, C. (2009). Characteristics of the Audit Processes for Distributed Informatics Systems. Informatica Economica, 13(3), 174. xix Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo,

6 include controls related to assertions for significant accounts, the presence of computer controls require auditors to gather evidence about the effectiveness of both the design and the effectiveness of controls, and the complexity of information systems makes the assessment of control risk more difficult xx. All of these factors force auditors to change the way they approach the audit. The complexity of information systems require auditors to become more knowledgeable of the available IT systems but also of the available IT system frameworks. This area of knowledge will require the expertise of a specialist to assist the audit team in understanding the infrastructure, software and processes of an IT system. Together with the sheer volume of work to be performed, the competency requirement limits the number of firms that can perform the audit. The auditor must obtain sufficient understanding of the procedures in place in order to design an efficient audit plan. Due to the large volume of data that is available, it would be inefficient to use a purely substantive audit approach. As a result, the auditor must be able to rely on the IT controls in place in order to perform an efficient audit. Major weaknesses in the IT controls will have pervasive impact on the reliability of the system, failing to detect such weakness will present career ending consequences for the auditor. It is likely that management will put in place many different controls in such a large integrated system. However, not all of these controls are of interest to the auditor because many of these controls overlap. The auditor should select those controls which best help to achieve the audit objectives in an effective and economical way xxi. In the planning stage, the auditor should seek to understand the various process the entity has in place and inquire about any changes from the prior year. Bortiz also provides a list of potential risks to internal controls such as: unauthorized access to applications, unauthorized changes to master file, unauthorized changes to systems or programs, and inappropriate manual intervention. The auditor should pay close attention to these items as they pose significant risk to the entity s internal control. While looking for items of interest, the auditor should also observe potential to utilize computer assisted audit techniques (CAATs) to introduce efficiency in auditing large volumes of data. In response to the increase in volume of transactional data, programs have been developed for auditors to provide ways to achieve higher levels of assurance. CAATs can be used as an analytical tool to help auditors identify potential high risk areas at the planning phase. In addition, it can also be used as part of the evidence gathering process by performing analytical procedures on all transaction data of a particular account. In turn, CAATs allow auditors to perform analytical procedures on all items of an account and help auditors achieve a higher level of assurance in an efficient manner. Auditors should always explore the option to use CAATs as part of their analytical procedure to increase audit efficiency and reduce costs. xx Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, 2.45 xxi Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo,

7 Information system audit is also of particular interest for internal auditors as their job is to implement effective controls in the organization. Internal audit can be viewed as being part of the overall system of internal control within an enterprise as well as being an independent monitor of internal controls within the enterprise xxii. The main objective for internal auditors is to ensure that the firm s IT strategy is aligned with its overall business strategy, at the same time they are looking for potential areas of weakness in the company controls. By employing internal auditors, management will be able to receive independent assessment on the company s internal controls and greatly improve its operational process. In addition, a technically competent auditor can also provide substantial design phase consultation and perform post-implementation audits xxiii making them a great addition to the company s workforce. Having a strong internal audit process also allows auditors to place greater reliance on the company s controls and potentially reduce audit cost for the entity. Implementation of Business Intelligence Systems Business intelligence systems represent large capital expenditures and companies would want to make the most of their resources. The added level of complexity further suggests that system implementation require careful planning and testing. The CICA IT Control Guidelines provides some guidelines and controls that would help an entity mitigate potential failures during system implementation. There are also many different frameworks available that present a structured approach to system implementation. Two most common frameworks are the Waterfall System approach Spiral System approach. System development frameworks divides system implementation into smaller phases and address each phase separately. The five most important phases of a system development life cycle are investigation, requirement analysis and initial design, acquisition/development, implementation, and maintenance xxiv. In the investigation phase, the entity should try to identify user needs. It involves a preliminary survey to is to assess if there is a problem, the nature of the problem, and whether computerization may be a possible answer xxv. From there, the company conducts a feasibility analysis and formalizes the system acquisition. In the requirement analysis and design phase, the entity is trying to conduct a study of the current system and analyze how the new system will address user needs. After the organization have decided how it will address its current IT needs moves onto the acquisition/development phase. In this phase, the company is trying to identify the most cost efficient way it can obtain the new IT solution. The company must choose between outsourcing, in-house development, open-source applications, and packaged systems. From there, xxii Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, 6.29 xxiii Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, 6.29 xxiv Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, 7.4 xxv Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo, 7.5 6

8 the company must customize the software to meet its operational needs before moving onto the implementation phase. During system implementation, the organization transfer its data from the old system into the new system and runs both systems in parallel to determine the reliability of the new system. Lastly, the company must continue to monitor its IT system and ensure that it continues to meet user needs. It is also important for management to keep proper documentation throughout the system development life cycle as it provides both the company and auditors useful information to identify potential weaknesses. Potential Issues Related to System Implementation Given the high level of complexity of implementing business intelligence systems, it is very difficult and costly for companies to integrate these systems into their existing process. The first decision the company must make is to whether to develop the system in-house, outsource the coding process, or purchase the software outright from a vendor. There are advantages and disadvantages to each option. To develop the software inhouse, the company will have control over the functions that it wants in the system and retain the code for future development. However, they also have to consider whether or not the company has capability to handle such a project. Depending on the complexity of the program being developed, the company will need to hire experienced software developers. In addition, the timeframe of the development process is also an issue as such programs are likely going to take a long time to develop. Outsourcing poses similar problems. The company no longer have direct control over what is being developed and they may not have the right to retain the code. This becomes an issue when the company plans to develop other programs that adds onto the current functionality of the system. When choosing the outsourcing partner, the company also have to assess the software partner s competency compared to the complexity of the program being outsourced. The worst case scenario for the company is that the software partner takes a long time to develop the program while keep asking the company for additional money to fund the project. In the end, the cost of developing these systems may greatly outweigh the costs. Advances in technology allow software vendors to innovate new solutions that will help company s decision process. New programs can be continuously added onto an information system to generate additional value for the system as a whole. This also presents another layer of difficulty if companies choose to develop systems with similar capabilities. At the same time, this provides software vendors a clear competitive advantage when it comes to developing business intelligence software. Large IT vendors such as SAP, Oracle, and IBM strategically focus on developing IT systems and continually offer new features to their clients. Their expertise and economy of scale makes their products irresistible. These innovative solutions also come with a price. The sky-high upfront costs of these IT solutions makes it impossible for small businesses to implement. For those mid-sized companies that are looking to transition into these systems, they have to look hard to find ways to finance the cost of implementing these systems. In addition to the astronomical upfront costs, there are also many additional hidden costs associated with these system implementations. Amacei, Popa and Toma listed some of the hidden costs: training, 7

9 integration, testing, customization, data migration, and consultants xxvi. To start, the company will need to provide sufficient training for its employees on how to use the system. The new system will also create some new processes in the company that will require human resources to fill. Companies also need time and resource to integrate the new system with the old one, customize the new functionalities, and migrate data to the new system. During the testing phase, companies will need to run both systems in parallel during the testing phase to ensure that the new system works. Maintenance fees and service costs will also represent a large sum that is to be paid to the software vendors and consultants in the future. While an integrated business intelligence system is a powerful tool, companies often fail to quantify the value of such system added to the firm. The value of such systems does not solely lie within the return on investment figure because it often helped companies achieve success in many different areas. For example, a company implemented business intelligence tools to identify customer preference in order to provide better customer service. After implementing better customer policies, the company s client list continues to grow. Measurement of return based on financial results would likely undervalue the analytic tools implemented in this situation. Management face a hard time allocating their recent financial success to the system because there lacks a direction relationship between customer service and increased sales. It is much easier to allocate the profit to the introduction of a new product. As a result, the intangible benefits of business intelligence systems are often overlooked. This lack of measurement creates additional implications when management tries to justify the costs of implementing such systems. Current Trends of Business Intelligence Systems New technology enable information transfer and processing to reach unprecedented speeds, however it also increase the volume of data being transferred. Companies are struggling to harness the information they collect not because of information overload but rather how data is organized. Lopez points out that the two biggest success factors for data analytics are scalability and cost effectiveness. He focuses on the importance of data integration process of data analytics and explains that to scale data volumes 10, 50, or 100 times require new architectural approaches xxvii. The first step of the data integration process is to filter out noise and this will allow data to be more manageable and user oriented. The system will as a result become faster and leaner as it shifts processing power to process more useful data. However, the challenge presented to companies and IT vendors is how it will achieve such filtering process. One of the biggest challenges for business intelligence systems is that it must provide useful analysis from semi-structured data. The term semi-structured data is used for all data that does not fit neatly into relational or flat files, which is called structured data. We use the term semi-structured (rather than the more common xxvi Amacei, C., Popa, M., & Toma, C. (2009). Characteristics of the Audit Processes for Distributed Informatics Systems. Informatica Economica, 13(3), 167. xxvii Lopez, J. A. (2012). Best Practices for Turning Big Data into Big Insights. Business Intelligence Journal, 17(4), 18. 8

10 unstructured) to recognize that most data has some structure to it xxviii. Some examples of semi-structured data include s, blogs, pictures, and news items. Businesses can use semi-structured data to observe consumer behavior and current market trends to gear their products and services to fit consumer needs. The ability to process semi-structured data provides a huge potential for businesses to explore. The current state of technology does not offer an automated IT solution that can fully analyze semi-structured data, instead IT vendors gear their solutions towards structured data. Most of the structured data come from the company s existing data processing architecture such as on-line analytic processing, data warehouse, executive information systems and enterprise requirement planning systems. However, due to the difficulty of organizing semi-structured data in a meaningful way, information technology today cannot find efficient ways to process these data. Implications to Executives The sophistication of the product offering from major IT vendors such as Microsoft, IBM, and Oracle makes an irresistible offer. Business intelligent systems have so many functions and features that its benefits can greatly outweigh its costs. The technology that is being offered is so advance that it can offer the acquirer a significant competitive advantage. At this point, the question is no longer whether or not the company should invest in the system but whether or not it can afford not to implement the system. At the same time, executives must also recognize the potential issues associated with the implementation of such complicated systems. The decision to proceed with an investment at this scale can be tough to make. As a result, the company must first understand its current user needs and then explore as many options as there are available to assess whether or not it truly needs to implement the system. Research suggests that a lack of fit between an organization s BI and its goals and characteristics is one reason of a lack of BI success xxix. A company should never spend such large sum of money on something that does not yield value. The next issue to address is whether or not it can fund such a large project. These systems have an astronomical upfront cost and have many hidden costs associated with the maintenance of the system. Management must be aware of these costs and prepare their financing schedules carefully to avoid any potential cash shortfall. In addition, the system implemented may not yield tangible value that can be easily quantified. For example, a CRM system will create better customer relationship for the company. If sales consistently rises, management can have a hard time allocating the portion of sales growth that s attributable to the improved customer relationship. As a result, an entity should assess the success of a system based on the pre-set objectives rather than the tangible value it generated. This factor reiterates the importance of identifying the needs of the company before implementing an expense IT system. xxviii Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13, 180. xxix Işık, O., Jones, M. C., & Sidorova, A. (2013). Business intelligence success: The roles of BI capabilities and decision environments. Information & Management, 50, 14 9

11 Conclusion Business intelligence is defined as the ability of a company to learn and adapt to its competitive environment. Such capability is attained through the acquisition of a business intelligence system. Such intelligent system contains many separable components and it integrates data across the entire organization to increase overall efficiency and improve decision making process. The wide range of functions and capabilities available in these systems provide a great opportunity for companies to differentiate themselves from competitors. At the same time, these complex systems poses problems for company executives as they try to identify the right solution at a price they can afford. These systems also have a pervasive effect on changing the way a company operates, management are forced to create new process and controls to complement the system. This also poses a problem for auditors as these systems increases the level of control risk in an audit. Despite the challenges and difficulties, more and more companies are implementing these systems to improve operations. As the survivability of the company depends on its ability to observe market trends, the question is not whether companies can afford the system but rather whether or not it can afford to not have the system. 10

12 Appendix Annotated Bibliography Topic: Business Intelligence Name: Shan Jiang UW ID: This research paper aims to gain an understanding what is business intelligence, the common tools of business intelligence, and what aspect of business intelligence can be integrated into audit. I would like to examine how business intelligence systems are used in practice and how they impact decision making. It may be possible for me to identify some current trends or development in the context of business intelligence systems. In addition, I have also gathered a few articles on business intelligence system structure that are specific to certain industries. I plan to inform the reader of what business intelligence is, how it is gathered, and how it is used. At the end of my paper, I plan on identifying some key trends of business intelligence systems. The general outline of my paper will be: 1. Definition of business intelligence 2. How important business intelligence systems are in today s world 3. What are the tools of business intelligence 4. What the systems can do 5. What are the challenges of implementing a business intelligence system 6. How does business intelligence systems impact audit The sources are sorted in the order of the outline of my research paper. Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Solomon Negash Business Intelligence Communications of the Association for Information Systems Vol May 31, 2013 IBM s IEEEXplore Annotation: This article provides a good background information of business intelligence systems. It explains that business intelligence system combine data with analytical tools to present information in a more useful manner to decision makers. It has the capability to analyze market trends, competitor actions, and impact of business decisions. The article also outlines some essential components of a business intelligence system. The author also referenced a survey that ranks the best uses of business intelligence in the order of corporate performance management, optimizing customer relationship, specific operation applications, and management reporting. Some tasks performed by business intelligence systems are: creating forecast, what if analysis, non-routine queries, and strategic insight. How it is to be used: I am going to use this article as a starting point to understanding business intelligence. Citation: Negash, S. (2004). Business Intelligence. Communication of the Association for Information Systems, 13,

13 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Jurij Jaklic, Ales Popovic, and Tomaz Turk Conceptual Model of Business Value of Business Intelligence Systems Management: Journal of Contemporary Management Issues Vol. 15 No May 31, 2013 EBSCO Annotation: IT not only affects how individual process activities are performed but also enhances a company s ability to exploit linkages. BI has an important role in the creation of current information for operational and strategic business decision-making. Business intelligence is a poorly defined term, different software vendors define it to suit their products. The study provides some definition of BI: - The process of gathering and analyzing internal and external business information - BI is neither a product nor a system. It is an architecture and a collection of integrated operational as well as decision-support applications and databases that provide the business community easy access to business data - An organized and systematic process by which organizations acquire, analyze, and disseminate information from both internal and external information sources significant to their business activities and for decision-making However, the essential element of BI is the understanding and interpretation of the analysis. As such, the human factor is an important component of BI and without it there is no such thing as business intelligence. There are two main reasons for BI measurement: to prove BI is worth the investment and to ensure BI products satisfy users needs. One of the problems with BI measurement is that it is hard to define the benefits. This study approaches BI measurement through the definition of information quality. The study concludes that the true value of BI systems not only provides better information quality but ultimately improves business processes. This study also provides a way for researchers to measure BI success by linking BI maturity with business success. How it is to be used: This study explains in detail what is business intelligence and I plan on using the definitions provided to better explain the concept of business intelligence and business intelligence systems. In addition, the study also outlined some interesting ways to measure business intelligence success, and I would like to explore ways to incorporate BI measurement into my research paper. Citation: Jaklic, J., Popovic, A., & Turk, T. (2010). Conceptual Model of Business Value of Business intelligence Systems. Management: Journal Of Contemporary Management Issues, 15(1), Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Hsinchun Chen, Roger H. L. Chiang, and Veda C. Storey Business Intelligence and Analytics: From Big Data to Big Impact MIS Quarterly Vol. 36 No May 31, 2013 Annotation: This article contains several key facts that I can include in my report to demonstrate how important business intelligence systems are: - Based on a survey of over 4,000 information technology (IT) professionals from 93 countries and 25 industries, the IBM Tech Trends Report (2011) identified business analytics as one of the four major technology trends in 2010s - In a survey of the state of business analytics by Bloomberg Businessweek (2011), 97 percent of companies with revenues exceeding $100 million were found EBSCO 12

14 to use some form of business analytics - The BI&A technologies and applications currently adopted can be considered as BI&A 1.0, where data is mostly structured - Major IT vendors include: Microsoft, IBM, Oracle, and SAP This article also describes current development of business intelligence systems. It identifies BI&A 2.0 as systems that will mine the web through social media sources and combine it with the capabilities of BI&A 1.0. Following the explosion in the number of mobile devices, new research opportunity arise in the field of BI&A 3.0. BI&A 3.0 integrates mobile content with powerful analytics. However, no such systems are foreseen for the near future. This article also offers on how BI&A can be used in different business context. How it is to be used: This article provides excellent background information on business analytics. It discusses the different application business intelligence systems have and its impact. This article also identifies key trends and areas of research that will prove to be useful in my research paper. Citation: Chen H., Chiang, R. L., & Storey, V. C. (2012). Business Intelligence and Analytics: From Big Data to Big Impact. MIS Quarterly, 36(4), Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Sabina Popescu Business Intelligence Solutions a Way of General Improvement of Efficiency and Effectiveness Review of International Comparative Management Vol. 13 No May 31, 2013 EBSCO Annotation: Business Intelligence (BI) solutions provide organizations the opportunity to make the best decisions in order to have a better image of business environment. Business intelligence systems have one of the greatest potentials in differentiation from competitors. The article lists some of the reasons why a company should adopt a BI system: - The company requires a single version of truth - It requires an analysis in depth - The localization of relevant information is not always at hand - It is necessary that the reporting be accessible to all - Applications not integrated into BI solutions are usually difficult to use - Operational flexibility is necessary - Aligning operations with strategic objectives Business intelligence solutions enable companies to make predictions and analyze data to identify relationships. Some capabilities of BI systems include reporting, what if analysis, scorecards and many other functions. How it is to be used: This articles identifies the benefits of a business intelligence system that will prove to be a useful inclusion in my research paper. This article also provides examples of what a BI system is capable of doing. Citation: POPESCU, S. (2012). Business Intelligence Solutions - a Way of General Improvement of Efficiency and Effectiveness. Review Of International Comparative Management / Revista De Management Comparat International, 13(1),

15 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Vaidas Gaidelys The Role of Competitive Intelligence in the Course of Business Process Economics and Management n/a May 31, 2013 Annotation: Competitive analysis and outside information is sure to become the main condition for accurate understanding of the dynamically developing market economy. The article discusses how business analytics are used in the context of business reorganization and begins by listing processes that can be singled out as different stages of business analytics: - Collection of basic data about structure available - Analysis of basic data collected - Collection of information concerning the expectations and vision of the top managers of business organization and analysis of this information - Collection and analysis of outside basic information about the current situation and the activities of the competitors - Preparation of a newly constructed model of business organization including or singling out the department responsible for competitive intelligence - Coordination of the expectations of the top managers of business organization and the newly constructed model of business organization - Preparation of the coordinated model of business organization for its implementation and its concrete putting into effect The article also identifies the top five most frequently found imperfections in competitive intelligence: - The information presented is too superficial, mass media being the principal source of information. Therefore, the information used may turn out to be not objective or even provided by competitors - The degree of validity of information, e.g. the information provided by a person who has no proper existence in a concrete sphere of activities, viz, a student of some business school - Information provided not in good time. It happens not infrequently that the user of information needs it namely today, whereas processing and presentation of information would take e.g. two days, so the information becomes of no value - The essential concentration. Most users of information believe that getting information that can be no longer affected by them or getting information of two hundred pages is not enough. Most of them prefer getting the analysis of information in two pages that would enable them to make the right decision - The addresses to whom the information is meant. Frequently ordinary employees come across information that, in their opinion, is important. Still they do not know with whom they could share this information and how the corporation can benefit from it In addition, the article provides a detailed analysis on how organizations should implement analytic systems. EBSCO How it is to be used: This article outlines the problems associated with implementing a business intelligence system and I would like to incorporate that in my research paper. Citation: Gaidelys, V. (2010). The Role of Competitive Intelligence in the Course of Business Process. Economics and Management,

16 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Oyku Isik, Mary C. Jones, and Anna Sidorova Business Intelligence (BI) Success and the Role of BI Capabilities Information & Management Vol June 2, 2013 EBSCO Annotation: Business intelligence continues to be a top priority for many organizations. One overarching theme is that the BI used within an organization must suit the problem space, or decision environment, within which is used and that this match is key to BI success. BI success is related to the positive value an organization achieves from implementing the system and is measured different across different organizations. As organizations move toward semi-structured decision making, they have to put more emphasis on aligning BI capabilities. This study discusses BI capabilities that it considers to be important: data quality, integration of BI with other systems, user access, the flexibility of the BI, and risk support. These capabilities cater to different organizational needs. The researchers then present the analysis their study and concludes that some BI capabilities are important for BI success regardless of the decision making environment, other BI capabilities may be moderated by the decision environment. How it is to be used: This study outlines the importance of aligning BI capabilities with the decision making environment. This study can act as a supplement for discussion on how BI systems are implemented. Citation: Işık, O., Jones, M. C., & Sidorova, A. (2013). Business intelligence success: The roles of BI capabilities and decision environments. Information & Management, 50,

17 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Bogdan Ghilic-Micu, Marinela Mricea, and Marian Stoica The Audit of Business Intelligence Solutions Informatica Economica Vol. 14 No June 2, 2013 EBSCO Annotation: Due to the evolution of technology business models and decision making process are evolving. Until recently, business intelligence solutions presented no real interest for auditors. But the changes in the business environment poses increasing risks for organizations and business intelligence solutions can reduce that risk and provide a entry point for audit. The most interesting function for auditors is that of information delivery for end users. There are also several reasons why business intelligence solutions require audit: - Identifying the impact of business intelligence solution implemented in the organization - Problems in real time and accurate transmission of information - Assessment of the business intelligence solution in order to determine whether it is efficiently exploited An efficient audit management needs a combination of people, processes and technology. The audit process of a business intelligence system has three stages: study planning, audit, and issuing audit report. A business intelligence audit proves its usefulness in relation with ensuring the quality of economic activities and processes within organizations. The article then continues to address different components of an business intelligence audit. How it is to be used: I was hoping that this article was going to answer what aspects of business intelligence can be integrated into audit. However, business intelligence audit had a different context than the one I had in mind. This article approaches business intelligence audit from the perspective how a company can validate its business intelligence system s value within the organization. This article outlined components of business intelligence systems that can be audited. The audit process outlined follows that of a financial statement audit and similarities can be drawn. These similarities will provide a basis of what aspects of business intelligence can be integrated into audit. Citation: Ghilic-Micu, B., Mircea, M., & Stoica, M. (2010). The Audit of Business Intelligence Solutions. Informatica Economica, 14(1),

18 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Jorge A. Lopez Best Practices for Turning Big Data into Big Insights Business Intelligence Journal Vol. 17 No May 31, 2013 EBSCO Annotation: New technology enable us to process data at unprecedented speeds, however, company are struggling to harness the new influx of data. The problem isn t information overload but how the data is organized. The two biggest success factors are scalability and cost effectiveness. Not all data are important data, while companies are trying to process larger volumes of data they increase the amount of noise in the process. The traditional extract, transform, and load (ETL) tools focused on functionality, but in today s environment they should focus on performance. To make sense of the increasing volume of data, businesses today must focus their business intelligence strategy on improving data integration so that the output is faster, more effective, and cost efficient. How it is to be used: I wanted to use this article to find a link between big data and business intelligence analytics. In my research paper, I am going to talk about some of the challenges associated with analyzing large volumes of data. This article also addresses the fact that companies have to focus their business intelligence strategy so that the output is faster and more user friendly. Citation: Lopez, J. A. (2012). Best Practices for Turning Big Data into Big Insights. Business Intelligence Journal, 17(4), Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? M. Keith Wright and Charles J. Capps Auditor Independence and Internal Information Systems Audit Quality Business Studies Journal Vol. 4 No June 3, 2013 Annotation: After Enron, there has been a resurgent interest in how to positively influence the quality of information systems (IS) auditing. PCAOB requires external auditors to form an opinion about the quality of internal audit function before deciding the extent to which it can be relied upon in the external audit. An information systems audit can be executed by external auditors as part of the annual financial statements audit, with the primary purpose of testing the structure of internal controls surrounding key information systems; or performed by the internal audit function (IAF) for a similar purpose, as part of management s responsibility for corporate governance. A high quality IS audit can assure that a firm s IS strategy is aligned with the overall firm strategy, and that specific policies are being followed. The study then investigates the major factors that affect internal audit quality. EBSCO How it is to be used: This study provides me with background information of IS auditing and I hope to use this information to talk about how BI systems impact audits. Citation: Capps, C. & Wright, M. (2012). Auditor Independence and Internal Information Systems Audit Quality. Business Studies Journal, 4(2),

19 Author Title of Article Periodical/Website Vol./No./ Edition Year Published Pages Date Accessed Location, data base, website link Added in the final paper? Cristian Amancei, Marius Popa, and Cristian Toma Characteristics of the Audit Processes for Distributed Informatics Systems Informatica Economica Vol. 13 No June 3, 2013 Annotation: The article begins by introducing the different components of a distributed informatics system divides it into different groups based on their functionalities. There are also many other types of information systems, for example transactional processing system, management information system, and decision support system. The characteristics of the informatics system are quantified by metrics and indicators. These indicators measure the relative success of the system. There are also many hidden costs associated with an ERP system such as training, testing, integration, and customization. The underlying principles of the audit process are: Independence, use of audit evidence, ethical behavior, correct reporting, and professional responsibility. The main fields in which the informatics audit is developed are: systems under development, live applications, and IT&C infrastructure. ISACA information system audit standards and COBIT framework provide some essential procedures for system audit. The following controls are considered to be common practice for information security: documentation, correct processing in applications, and business continuity management. How it is to be used: This article provides a good breakdown of IS components and introduces how audit is conducted for distributed IS systems. I will use this article as a guideline for how to approach BI audits and identify some audit processes for BI systems. Citation: Amacei, C., Popa, M., & Toma, C. (2009). Characteristics of the Audit Processes for Distributed Informatics Systems. Informatica Economica, 13(3), EBSCO 18

20 Bibliography Intelligence. (n.d.). In Merriam-Webster online. Retrieved from Boritz, J. E. (2011). Computer Control & Audit Guide (15 th ed.). Waterloo, ON: University of Waterloo. 19