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SUMMARY
Business intelligence (BI) has become the top priority for many organizations who have implemented BI solutions
to improve their decision-making process. Yet, not all BI initiatives have fulfilled the expectations. We suggest that
one of the reasons for failure is the lack of an understanding of the critical factors that define the success of BI
applications, and that BI capabilities are among those critical factors. We present findings from a survey of 116
BI professionals that provides a snapshot of user satisfaction with various BI capabilities and the relationship be-
tween these capabilities and user satisfaction with BI. Our findings suggest that users are generally satisfied with BI
overall and with BI capabilities. However, the BI capabilities with which they are most satisfied are not necessarily
the ones that are the most strongly related to BI success. Of the five capabilities that were the most highly correlated
with overall satisfaction with BI, only one was specifically related to data. Another interesting finding implies that,
although users are not highly satisfied with the level of interaction of BI with other systems, this capability is highly
correlated with BI success. Implications of these findings for the successful use and management of BI are dis-
cussed. Copyright © 2012 John Wiley & Sons, Ltd.
1. INTRODUCTION
In response to an ever increasing amount of data to analyse and growing pressure to provide better and
quicker responses to customers, many organizations have turned to business intelligence (BI) applica-
tions as a means to improve organizational decision making. Coined by the Gartner Group in 1990s, the
term BI came to embrace a variety of information technology (IT)-based tools and approaches for
helping organizations to make better use of the increasingly vast amounts of data accumulated from
both internal and external sources. Thus, BI can be defined as a system comprised of both technical
and organizational elements that presents historical information to its users for analysis and enables
effective decision making and management support, for the overall purpose of increasing
organizational performance (Eckerson, 2003; Watson et al., 2004).
Organizations today collect enormous amounts of data from numerous sources, and using BI to
collect, organize and analyse this data can add great value to a business (Gile et al., 2006). BI can also
provide executives with right time data and allow them to make informed decisions to put them ahead
of their competitors (Viaene et al., 2009). In 2010, BI topped the list of the most important application
and technology developments in an annual survey of IT executives (Luftman and Ben-Zvi, 2010). Re-
search also shows that most companies may focus their IT investment plans on BI (Evelson, 2011).
* Correspondence to: Oyku Isik, Operations and Technology Management Center, Vlerick Leuven Gent Management School,
Leuven, Belgium. E-mail: oyku.isik@vlerick.com
Despite all the interest and investments, not all BI initiatives live up to management’s expectations. We
posit that failures occur when organizations make BI adoption decisions without a clear understanding
of the critical BI capabilities that define the success of BI applications. BI capabilities are critical func-
tionalities that help an organization improve its performance and adapt to environmental change
(Watson and Wixom, 2007). They range from data reliability to the flexibility of the BI in decision-
making support. As organizations take advantage of these capabilities, their BI use increases, as does
the value derived from BI applications (Watson and Wixom, 2007).
In this study, we examine the relationship between various BI capabilities and user satisfaction with
BI to provide a snapshot of the role of BI capabilities in BI success. BI satisfaction is used in this profile
as a surrogate for BI success (Lonnqvist and Pirttimaki, 2006). We use survey data collected from BI
professionals (business managers who use BI for strategic, tactical and operational decision making)
to understand the role of BI capabilities. Specifically, we focus on 10 BI capabilities that are identified
as important to BI success in the literature (Hostmann et al., 2007). They are quantitative and qualita-
tive data quality, internal and external data source quality, internal and external data reliability, user ac-
cess, flexibility, interaction with other systems, and risk management support capabilities.
Our key findings suggest that users are most satisfied with internal and quantitative data capabilities
of BI and least satisfied with external data capabilities. Overall, we observed that level of satisfaction
for advanced BI capabilities (e.g. interaction with other systems and external data reliability) is lower.
Another interesting finding is that although less than half of our respondents were satisfied with the
level of interaction of BI with other systems, this capability was highly correlated with overall BI
satisfaction.
Section 2 reviews the literature for this study. We then describe the data collection and analysis in
Section3. After reporting on the findings in Section 4, we conclude with a discussion on our findings
and their implications in Section 5.
2. LITERATURE BACKGROUND
BI has become an interest for information systems (IS), which implies systems composed of processes,
people and information that improves the effectiveness and efficiency of organizations, researchers rela-
tively recently and is a research stream that is still in development (Ponelis and Britz, 2011). Ever
since the term BI has been coined, various definitions of BI have emerged in the academic and practi-
tioner literature. While some broadly define BI as a holistic and sophisticated approach to cross-
organizational decision support (Moss and Atre, 2003; Alter, 2004), others approach BI from a more
technical point of view (Burton and Hostmann, 2005; White, 2005). BI, however, is comprised of both
technical and organizational elements (Watson et al., 2006). In the most general sense, BI presents
historical information to its users for analysis to enable effective decision making and for management
support (Eckerson, 2003). For the purpose of this research, BI is defined as a system comprised of both
technical and organizational elements that presents historical information to its users for analysis, to
enable effective decision making and management support, for the overall purpose of increasing
organizational performance.
Companies realize benefit from their BI initiatives when they manage to link it with their business strat-
egy (Viaene, 2008). Yet, most organizations struggle to measure how BI impacts the organization’s per-
formance and thus have difficulty realizing how successful their BI initiative is. In the most general
sense, BI success can be defined as the positive value an organization obtains from its BI investment.
Yet, how an organization defines BI success depends on what benefits that organization needs from its
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
DOI: 10.1002/isaf
BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 163
BI initiative (Miller, 2007). BI success may represent attainment of benefits such as improved profitability,
increased efficiency (Eckerson, 2003) and reduced costs (Pirttimaki et al., 2006). For the purpose of this
research, BI success is defined as the positive benefits organizations achieve through use of their BI. An-
other approach to measuring BI success is subjective measurement (Lonnqvist and Pirttimaki, 2006). This
involves measuring the satisfaction of the decision maker with BI by asking questions regarding the effect-
iveness of the BI (Davison, 2001). This way, it is possible to learn what users think of various aspects of the
system, such as ease of use, timeliness and usefulness. With this method, it is also possible to understand
the perceptions of the extent to which the users realized their expected benefits with BI.
Most of the BI users today meet their information-processing and decision-making needs through BI
as it facilitates organizational information-processing capacity (Gallegos, 1999; Nelson et al., 2005). BI
does so by combining data collection, data storage and knowledge management with analytical tools so
that decision makers can convert complex information into effective decisions (Negash, 2004). The
wide selection of BI platforms and applications available in the market today shows that there is a de-
mand for a variety of BI functionalities. Different organizational characteristics and strategic goals may
also require using different BI capabilities. BI capabilities are critical functionalities of BI that help an
organization improve its adaptation to change as well as improve its performance (Watson and Wixom,
2007). With the right capabilities, BI can help an organization predict changes in product demand or
detect an increase in a competitor’s new product market share and respond quickly by introducing a
competing product (Watson and Wixom, 2007).
BI capabilities are critical functionalities that help an organization improve its performance and its
adaptation to change (Watson and Wixom, 2007). BI capabilities have remained largely unexamined
in academic IS research, although they have been widely discussed in practitioner oriented literature
(Eckerson, 2004; Watson and Wixom, 2007). For example, a recent Gartner Group research report
about the evolution of BI relates BI capabilities related to information access and analysis to deci-
sion-making style within an organization (Hostmann et al., 2007), where information access and ana-
lysis includes methods and technologies used to collect and analyse the information. In our paper we
delineate such information access and analysis capabilities and relate them to the overall BI success.
Specifically, we examine such capabilities as the sources from which the data are obtained, data types,
data reliability, user access in terms of authorization and/or authentication, flexibility of the system,
interaction with other systems, and the level of risk supported by the system (see Table I for a summary
of definitions). We discuss each of the capabilities below.
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164 O. ISIK ET AL.
Quantitative data quality The capability of BI to manage data that can be measured or Sukumaran and Sureka (2006)
identified on a numerical scale, and analysed with statistical
methods in an accurate, comprehensive and consistent way.
Qualitative data quality The capability of BI to manage data that is non-numerical Sukumaran and Sureka (2006)
and in text, image or sound format that needs to be
interpreted for analysis purposes, in an accurate, comprehensive
and consistent way.
Internal data reliability The capability of BI to provide and manage internal data without Parikh and Haddad (2008)
any conflicts, inconsistencies, in a reliable and up-to-date manner.
External data reliability The capability of BI to provide and manage external data without Hostmann et al. (2007)
any conflicts, inconsistencies, in a reliable and up-to-date manner.
Internal data source quality The capability of BI to store, retrieve and disseminate data from Harding (2003)
internal data sources such as a data warehouse, a data mart,
or an online analytical processing (OLAP) cube in a concise,
available and readily usable manner.
External data source qualityThe capability of BI to store, retrieve and disseminate data from Harding (2003)
external data sources such as websites, spreadsheets, suppliers and
vendors in a concise, available and readily usable manner.
Interaction with other The capability of BI to provide enterprise business integration White (2005)
systems through a unified view of business data, business processes
and business applications by managing the flow of events as well
as a single personalized interface to the user.
User access The capability of BI to manage different information access Hostmann et al. (2007)
mechanisms to provide the right users the right accessibilities.
Flexibility The capability of BI to provide decision support when variations Gebauer and Schober (2006)
exist in the business processes, technology or the business
environment in general.
Risk management support The capability of BI to support decision making under conditions Harding (2003)
of uncertainty when all the facts are not known.
sources (Harding, 2003). Internal data are generally integrated and managed within a traditional BI
application information management infrastructure, such as a data warehouse, a data mart or an online
analytical processing (OLAP) cube (Hostmann et al., 2007). External data includes the data that
organizations exchange with customers, suppliers and vendors. This is rarely inserted into a data
warehouse. Often, external data is retrieved from websites, spreadsheets, audio files and video files.
The quality of these sources may have a direct impact on the effectiveness of the BI system and
satisfaction of its users. It is evident in research that organizations such as Allstate insurance company
and 1-800-Contacts retailer, who are renowned for their successful BI solutions, pay critical attention to
the sources from which they obtain their data (Howson, 2006).
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BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 165
2.6. Flexibility
Flexibility refers to the capability of BI to provide decision support when variations exist in the busi-
ness processes, technology or the business environment in general (Gebauer and Schober, 2006).
The amount of flexibility directly impacts the performance of a system: while insufficient flexibility
may prevent using the system for certain situations, too much flexibility may increase complexity
and reduce usability (Silver, 1991; Gebauer and Schober, 2006). It is critical that BI provides the neces-
sary flexibility in the decision-making process, especially for applications or processes where
innovation and dynamism are required (Dreyer, 2006). Technology does not always support exceptional
situations, although organizations need the flexibility and robust functionality to obtain the optimum
potential from BI (Antebi, 2007). Where the problems about which decisions are made require flexibil-
ity in their assessment, this capability is key to BI success (Clark et al., 2007).
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
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166 O. ISIK ET AL.
organization (Imhoff, 2005), and how successfully the organization manages that risk is a capability
that directly impacts BI performance. Risk and uncertainty exist in every business decision, and orga-
nizations may use BI to minimize uncertainty and make better decisions. In particular, organizations
which have specific and well-defined problems to solve have a low tolerance for risk and thus may
be using BI to manage that risk (Hostmann et al., 2007).
As organizations take advantage of these capabilities, their BI use increases, and so does the maturity
level of BI (Watson and Wixom, 2007). Mature BI increases organizational responsiveness, which posi-
tively affects organizational performance. Thus, it is important to recognize BI capabilities to better
apply it to strategic needs (Ross et al., 1996).
3. DATA COLLECTION
The target population for this research consisted of business managers who use BI for strategic, tactical
and operational decision making across a range of organizations and industries. Data were collected
using an online survey between July and September of 2008. The firms were randomly selected and
the contact information of decision makers was obtained from a publicly available mailing list of a mar-
ket research company; 116 responses from a variety of industries, company sizes, organizational levels,
functional areas and BI experience were received (Table II). In total, the survey link was emailed to over
5000 recipients. This corresponds to a response rate lower than 1 %, which is not necessarily surprising
for web-based surveys (Basi, 1999).
The survey included questions measuring user satisfaction with BI as well as user assessments of
specific BI capabilities. Items measuring user satisfaction were selected from Hartono et al.’s (2007)
management support system success dimensions and Doll and Torkzadeh’s (1988) end-user satisfaction
measure. BI capabilities were operationalized with items developed based on the Gartner Group reports
as well as other practitioner-oriented publications from the Data Warehousing Institute (Harding, 2003;
Sukumaran and Sureka, 2006; Damianakis, 2008). Responses for all items in the survey were captured
on a five-point Likert scale.
4. FINDINGS
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BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 167
Functional area
Information technology 46.6
Management 9.5
Finance 7.8
Marketing 7.8
Sales 5.2
Supply chain 2.6
Operations research 0.9
Other 19.8
Level in organization
Executive 18.1
Middle 40.5
Operational 25
BI experience
New BI user 12.1
Intermediate BI user 37.1
Advance BI user 50.9
Industry
Manufacturing 10.3
Insurance/real estate/legal 9.5
Medical/health 8.6
Transportation/utilities 7.8
Wholesale/retail/distribution 7.8
Banking 5.2
Data processing services 4.3
Education 11.2
Business service/consultant 14.7
Number of company employees
<100 23.3
100–499 9.5
500–999 8.6
1000–4999 23.3
5000–9999 9.5
≥10 000 25.9
Total company annual revenue (US dollars)
>$100 million 32.8
$100 million to $499 million 12.9
$500 million to $1 billion 9.5
≥$1 billion 34.5
level of satisfaction reported was for the ability of BI to provide precise information, with 78.5 % of
respondents satisfied or strongly satisfied. Overall, the results suggest that the majority of respondents
were satisfied with BI. Yet, fewer than 25 % reported being strongly satisfied with any aspect of their
BI. This is an indication that BI users and managers are not yet getting full leverage from BI in terms
of precision, timeliness, decision-making support or even ease of use (user friendliness) that they seem
to expect. Table IV presents the means and standard deviations of responses to the BI satisfaction items.
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
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168 O. ISIK ET AL.
the quality of external data sources, external data reliability and the extent of BI interaction with other
systems. For each of the capabilities we used several questions to capture satisfaction with various
dimensions of each in order to provide a richer picture of BI satisfaction. These are discussed in the
following sections.
1
For ease of reading, from this point forward we use the term ‘satisfied’ to indicate respondents who were either satisfied or
strongly satisfied, and the term ‘dissatisfied’ to indicate respondents who were either dissatisfied or strongly dissatisfied.
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
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BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 169
Data quality from BI Strongly dissatisfied Dissatisfied Neither satisfied Satisfied Strongly satisfied
nor dissatisfied
Quantitative
Accuracy of quantitative data 0.9 5.2 18.1 51.7 24.1
Comprehensiveness of quantitative data 2.6 3.4 26.7 49.1 18.1
Consistency of quantitative data 2.6 6.0 19.8 47.4 24.1
Quality of quantitative data 2.6 7.8 19.8 49.1 20.7
Qualitative
Quality of qualitative data 6.9 15.5 31.9 35.3 10.3
Accuracy of qualitative data 6.0 11.2 34.5 37.9 10.3
Comprehensiveness of qualitative data 6.0 15.5 33.6 34.5 10.3
Consistency of qualitative data 6.9 12.1 34.5 37.1 9.5
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Internal
Reliability of internal data collected for BI 0.9 6.9 15.5 57.8 19.0
Resolution of inconsistencies and conflicts in the 6.9 20.7 25.0 40.5 6.9
internal data collected for BI
Accuracy of internal data collected for BI 0.9 9.5 25.0 44.8 19.8
Recency of internal data collected for BI 0.9 5.2 19.0 43.1 31.9
External
Reliability of external data collected for BI 8.6 10.3 39.7 35.3 6.0
Resolution of inconsistencies and conflicts in the 6.0 16.4 36.2 34.5 6.9
external data collected for BI
Accuracy of external data collected for BI 4.3 10.3 44.8 32.8 7.8
Recency of external data collected for BI 6.9 12.9 42.2 30.2 7.8
User Access
In general, the majority of users were satisfied with various aspects of their access to BI system
(Table IX). User access was assessed on two dimensions: extent of access to BI data and the vehicle
through which access is provided. Approximately 70 % were satisfied with the extent of access to BI
data and capabilities and over 60 % were satisfied with the way they access BI applications.
Data source quality Strongly Dissatisfied Neither satisfied nor Satisfied Strongly
dissatisfied dissatisfied satisfied
Internal
Availability of internal data sources used for BI 2.6 7.8 17.2 46.6 25.9
Usability of internal data sources used for BI 2.6 11.2 20.7 44.8 20.7
Ease of understanding of internal data sources 7.8 13.8 24.1 41.4 12.9
used for BI
Conciseness of internal data sources used for BI 6.0 17.2 37.1 30.2 9.5
External
Availability of external data sources used for BI 11.2 18.1 41.4 19.0 10.3
Usability of external data sources used for BI 13.8 21.6 37.9 23.3 3.4
Ease of understanding of external data sources 12.9 24.1 37.9 20.7 4.3
used for BI
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BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 171
User access quality Strongly Dissatisfied Neither satisfied nor Satisfied Strongly
dissatisfied dissatisfied satisfied
Quality of the way the user accesses BI 3.4 14.7 20.7 42.2 19.0
Access to the information user needs in BI 5.2 8.6 13.8 40.5 31.9
How well BI fits the types of decisions user makes 2.6 6.0 22.4 49.1 19.8
using BI
BI support of decisions associated with high level of risk (e.g. 2.6 17.2 35.3 37.9 6.9
entering a new market, hiring a new manager)
BI support of decisions motivated by exploration and discovery of 4.3 12.1 27.6 45.7 10.3
new opportunities (e.g. starting a new business line, creating a
new product design)
BI support in minimizing uncertainties in decision making process 2.6 6.0 19.0 56.9 15.5
BI support in managing risk by monitoring and regulating the 2.6 11.2 17.2 47.4 21.6
operations (e.g. monitoring key performance indicators (KPIs),
customizing alerts or creating dashboards)
decisions associated with high levels of risk, and 20 % disagreed that their BI system even offers such
capabilities. Over 55 % of respondents indicated that they were satisfied with how well their BI systems
supported exploration of new opportunities (versus 20 % who indicated the lack of such capabilities).
The majority of respondents (over 70 %) were satisfied that their BI system helps them reduce uncer-
tainty in their decision making and that BI helps them manage risk through operational controls.
Flexibility
Users were not very satisfied with the flexibility of their BI system (Table XI). Fewer than 25 % were
satisfied with their BI system’s ability to easily accommodate changes to their business environment,
allow for rapid changes or make it easy to deal with exceptional situations. Thus, a picture emerges
of BI solutions that are fairly static in their ability to respond to rapidly changing environments.
How quickly BI accommodates changes in business 6.0 19.0 28.4 33.6 12.9
requirements
How well BI makes it easier to deal with exceptions 3.4 20.7 30.2 36.2 9.5
How well the BI components are organized and 4.3 18.1 26.7 37.9 12.9
integrated to allow for rapid changes
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Interaction with other systems Strongly Dissatisfied Neither satisfied Satisfied Strongly
dissatisfied nor dissatisfied satisfied
How well BI provides a unified view of business data and processes 4.3 15.5 26.7 40.5 12.9
How well BI provides links among multiple business applications 4.3 6.9 20.7 48.3 19.8
How well BI provides a comprehensive electronic catalog of the 8.6 16.4 30.2 32.8 12.1
various enterprise information resources in the organization
How well BI provides easy and seamless access to data from other 10.3 21.6 29.3 30.2 8.6
applications and systems
BI system’s ability to offer a comprehensive catalogue of enterprise information resources and fewer
than 40 % were satisfied with their BI offering easy and seamless access to data from other systems.
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
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BUSINESS INTELLIGENCE (BI) SUCCESS AND THE ROLE OF BI CAPABILITIES 173
BI capabilities BI success
higher data quality, higher quality of data sources, better user access quality, higher flexibility, and bet-
ter risk management support, and stronger interaction with other systems are associated with higher
levels of overall BI satisfaction. Although external data quality was not significantly correlated with
overall BI satisfaction, at a = 0.05, it was at a = 0.10.
Of the five capabilities that were the most highly correlated with overall satisfaction with BI, only
one was specifically related to data (quantitative data quality). Furthermore, only three of the five cap-
abilities most closely correlated with BI success are characterized by a high level of user satisfaction
(quantitative data quality, risk management support and user access). Although less than 50 % of users
were satisfied with the level of interaction of BI with other systems and with the flexibility of their BI
system, these two capabilities were among the top five most correlated with overall BI satisfaction. This
suggests that while BI systems are largely good at providing some of the capabilities that are critical to
BI success, there is room for improvement in others.
In summary, our findings suggest that:
• adequate user access is a cornerstone of the overall user satisfaction with BI;
• users value the most BI capabilities that allow them to deal with uncertainty and change in the
environment;
• users see the value of BI in providing capabilities for interaction among various enterprise
applications;
• BI capabilities that most strongly relate to BI success are not necessarily the ones with which users
are most satisfied.
5. CONCLUSIONS
The purpose of this study was to create a snapshot of user satisfaction with BI as well as their assess-
ment of specific BI capabilities, and to examine the relationship between such capabilities and BI sat-
isfaction. Our findings indicate that the majority of respondents are relatively satisfied with BI overall
and have a positive assessment of specific BI capabilities. Yet, our results point out several implications
for developing better BI solutions. For example, improving the level of interaction between BI and
other enterprise systems may be a key to BI success. Although users are not highly satisfied with this
Copyright © 2012 John Wiley & Sons, Ltd. Intell. Sys. Acc. Fin. Mgmt., 18: 161–176 (2011)
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174 O. ISIK ET AL.
capability, it is strongly correlated with the level of satisfaction with BI overall. In addition, many
respondents were not satisfied with BI capabilities associated with providing access to external data.
Although such capabilities were not as strongly related to overall BI satisfaction as others, this
may suggest that the BI usage among our respondents is more internally focused, or it may be
an indication of lower expectations that the users have of such external data capabilities. It is also
possible that as the BI practice matures, users are likely to pay more attention and expect more of such
external data capabilities. Therefore, improving external data capabilities presents another important
direction in managing BI.
Our findings also highlight the strong relationship between user assessment of specific BI capabilities
and their overall satisfaction with BI. Users particularly value adequate user access, BI capabilities that
help them deal with uncertain and changing environment and the level of interaction of BI systems with
other systems. As BI continues to mature, it becomes increasingly critical to the support of decisions that
keep organizations competitive. Our findings indicate that, largely, BI solutions provide a solid set of
basic capabilities to support decisions grounded in basic questions like ‘What has happened?’ or
‘What is happening in our organization?’ Developing stronger, more advanced BI capabilities in
organizations to support decisions based on the answers to forward-looking questions may be key to
providing BI that successfully facilitates decisions in today’s dynamic, information-based organizational
environments.
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