All Business Intelligence (BI) tools are reporting tools, but all reporting tools are not BI tools. BI tools are designed to report, analyze and present data for
Functionality: Most business intelligence tools are supported by a robust metadata layer—also known as the semantic layer—against which all reporting is generated. In reporting tools no such semantic layer exists, and they invariably drive from the core database. This is a major advantage of BI over reporting tools. The semantic layer is captured in a repository, either in a file or database. Security exists around this repository and there are means by which objects created in the repository can be prevented from modification with permissions for specific individuals and actions. By contrast, reporting tools have no such repository. The query generation by BI tools can be very complex and can involve multiple steps and multiple passes. Reporting tools usually have a simple SQL-generation process. BI tools generally have the capability to talk to a variety of data sources, including flat files, XML and Excel. Reporting tools have been slow to develop this capability.
Formats: The dimensional reporting of business intelligence tools has an advantage over the flat reporting of reporting tools. BI tools provide the capability to perform ad hoc analysis on pre-built queries whereby the user can drill down a particular dimension or drill across to other dimensions provided such access paths have been defined within the semantic layer / metadata layer. This allows for important insight into data and helps in narrowing down the problem area thereby aiding decision making. In contrast, reporting tools provide static content based on a report which was pre-built. Any more information requires that the report be modified or re-built.
Flexibility: Business intelligence is for analytical and power users who understand how data is structured. BI gains the upper-hand over reporting tools because what the latter lack is the flexibility provided by BI tools to slice and dice the data even further based on a pre-built or canned report. Reporting tools are for simple users who deal with static reports and do not need any great flexibility in the way the data is presented and used.
Decision making: All reports are in aid of supporting an informed or fact-based decision making. Even canned or structured reports produced by standard reporting tools can offer much insight provided they are built well. But business intelligence enables diverse handling of data; this is the biggest advantage that a BI tool offers over traditional reporting tools. In addition, BI tools are very user friendly and thus appeal to a larger user base, unlike reporting tools, which require expert help. However, if a BI tool is not properly configured or used it can cause more damage than an ordinary reporting tool.
Updates: Reporting tools do not have the capability to provide the visualization that is possible with dashboards. At best, reporting tools can provide certain charts and graphs, but they lack the interactive capability which a dashboard can provide. In that sense, for executive reporting, dashboards and business intelligence tools are better suited than reporting tools.
About the author: Sundararajan Balasubramaniam, Director at Capgemini, has extensive experience in the field of BI and Information Management, and has headed many BI projects.
(As told to Sharon D’Souza)