Home > Articles

Internet-Enabled Business Intelligence

This chapter examines how human intelligence relates to business, and describes Business Intelligence (BI) as an iterative loop composed of Extraction, Transformation, and Loading (ETL) processes, the data warehouse, decision support systems, BI applications, and decision makers.
This chapter is from the book

If you're good at finding the one right answer to life's multiple-choice questions, you're smart. But there's more to being intelligent—a creative aspect, whereby you invent something new “on the fly.” Indeed, various answers occur to your brain, some better than others.

Every time we contemplate the leftovers in the refrigerator, trying to figure out what else needs to be fetched from the grocery store before fixing dinner, we're exercising an aspect of intelligence not seen in even the smartest ape. The best chefs surprise us with interesting combinations of ingredients, things that we would never think “went together.”

William H. Calvin
How Brains Think1

In Chapter 1, we learned that Internet Enabled Business Intelligence (IEBI) is a solution. We also noted that each of the elements within a solution is changed by the other. In Chapter 2, we discussed the rise of the Internet and the environment it has created. As part of this examination, we saw how the organization has evolved to compete in this changed world. This is only part of the story, two ingredients in our solution. The third is Business Intelligence (BI).

My youngest daughter and I are part of a father and daughter program that entails monthly weekend campouts. In addition to providing some one-on-one time with my daughter, the program gives me the opportunity to spend time with other fathers of young daughters. Typically, once we get all the girls tucked away, the dads sit by the fire and solve the world's most pressing problems. In one of these discussions, one of the dads noted that intelligent people, in his experience, are not always the most successful. He described how intelligent people at his company often lacked common sense. Although they had book learning, they lacked creativity. My friend had never read William Calvin.

Many misunderstand the true nature of intelligence. It would be pointless for me to drone on about intelligence unless we first understand the nature of intelligence. We begin this chapter, therefore, by exploring intelligence and examining how intelligence relates to business.

Far too often when people hear “BI,” they think “data warehouse.” The data warehouse is just one part of the information systems that support BI. As the chapter progresses, we will find that the data warehouse and associated information systems really are implementation details of BI. They are not BI in and of themselves.

This chapter describes BI as an iterative loop composed of Extraction, Transformation, and Loading (ETL) processes, the data warehouse, decision support systems, BI applications, and decision makers. We will examine each component of this loop in detail. Some of you may recognize the discussion on data warehousing from my previous book, Object-Oriented Data Warehouse Design.

3.1 Intelligence

Let's start by talking about thinking. That's what BI is all about: thinking. In their book The Ape at the Brink of the Human Mind, Sue Savage-Rumbaugh and Roger Lewin discuss how oranisms with a complex nervous system are all faced with a common question. They describe how in each moment of life they must decide what to do in order to survive. From the lowliest earthworm to man, we are all faced with one common question: What shall I do next? We find intelligence in how an organism finds an answer to this question.

Organisms and organizations are very similar. An organism is a body that is composed of organs that work together towards a common goal: staying alive. An organization is made of people or groups of people who work together towards a common goal: staying in business. This is a common metaphor. The apostle Paul described the church as a body in which each member has its own particular function. We can conclude, therefore, that in the same way we find intelligence in how an organism decides what to do next, we find intelligence in an organization by how it defines what to do next.

In 1575 the Spanish physician Jaun Huarte defined intelligence as the ability to learn, to exercise judgment, and to be imaginative. We can extend this definition of intelligence as the ability to think abstractly, to be able to organize volumes of information, and then to reason. When we discuss BI, therefore, we are talking about thinking abstractly about the organization, reasoning about the business, and organizing large quantities of information about the business environment. The development of a strategy requires that the decision maker take a set of facts and create something new. This is the very essence of BI. The sheer size of most organizations, however, requires that there be an information infrastructure present to facilitate this level of intelligent thought.

The central nervous system of the organism facilitates intelligence. The central nervous system of an organization is the information infrastructure. Consider the similarities between the two. The central nervous system receives information from the outside world and transmits that information to the rest of the organism. The brain processes that information and directs the behavior to the rest of the organism. In the organization, the information infrastructure receives data from the outside world as transactions. Some server receives the transactions and takes appropriate action. If the transaction is a purchase, orders are filled and customers are billed. The presence of a central nervous system, however, does not create intelligence.

The human brain is composed of three distinct concentric layers. The innermost layer is the oldest; it controls the automatic biological functions. These are the things that we do not think about, such as digesting, breathing, and sleeping. Often, this innermost layer is referred to as the reptilian brain. The second layer controls the emotions; this is the limbic system. The third layer, the new brain, is where thinking is done. This is the cerebral cortex. The cerebral cortex carries out such functions as observing, organizing, and responding.

In scanning the business world, we see organizational intelligence has evolved to varying levels. Organizations that have only operational systems are at the lowest rung of the evolutionary ladder; they function with only a reptilian brain. The operational system receives a stimulus and passes that stimulus on to other parts of the organization. It signals when there is pain or pleasure. For example, when stock levels fall too low, it registers hunger, and the organization reacts by ordering more stock. When sales exceed expectations, it registers pleasure, and the payroll department issues bonus checks. Organizations with purely operational systems are unable to make meaningful information out of the volumes of data locked within the operational systems.

Some companies have evolved to the level of the limbic system. These companies are often worse off than those at the reptilian level. Limbic companies are continually buffeted by market forces, reacting and overreacting to events in the marketplace. Earnings drop a cent per share and a thousand people lose their jobs. Six months later, a new promising market opens and a hiring frenzy commences. Organizations in this mode are emotional companies. Strategy cannot exist in this environment. Rather than shaping their market, the market shapes them. They optimize the stock price often at the expense of the long-term health of the company. The information systems of these organizations provide some analytical capabilities, but it is only a snapshot of the current environment. It is not within the context of what has occurred in the past or projections of the future.

The new brain, the cerebral cortex, is the thinking brain. This is where the capacity to think abstractly exists. It is in the cerebral cortex that reasoning occurs and the vast quantities of information are organized into meaningful systems. The data warehouse is the part of the information infrastructure that transforms the volumes of information into something meaningful. Within the warehouse is a detailed history of past experiences. Decision Support System (DSS) tools allow the strategist to find patterns in these experiences for comparison to the current situation. In this way, the strategist can better predict the future.

So, why does an organization need BI? In order to survive, the organization must develop a winning strategy. In order to develop a winning strategy, one must be able to anticipate future conditions. Understanding the past is the best way to be able to predict the future. For this reason, information is the meat upon which a strategy feeds. It is only through the eyeglass of the DSS that the decision maker can look out on the organization's environment and see behaviors amidst the havoc.

InformIT Promotional Mailings & Special Offers

I would like to receive exclusive offers and hear about products from InformIT and its family of brands. I can unsubscribe at any time.


Pearson Education, Inc., 221 River Street, Hoboken, New Jersey 07030, (Pearson) presents this site to provide information about products and services that can be purchased through this site.

This privacy notice provides an overview of our commitment to privacy and describes how we collect, protect, use and share personal information collected through this site. Please note that other Pearson websites and online products and services have their own separate privacy policies.

Collection and Use of Information

To conduct business and deliver products and services, Pearson collects and uses personal information in several ways in connection with this site, including:

Questions and Inquiries

For inquiries and questions, we collect the inquiry or question, together with name, contact details (email address, phone number and mailing address) and any other additional information voluntarily submitted to us through a Contact Us form or an email. We use this information to address the inquiry and respond to the question.

Online Store

For orders and purchases placed through our online store on this site, we collect order details, name, institution name and address (if applicable), email address, phone number, shipping and billing addresses, credit/debit card information, shipping options and any instructions. We use this information to complete transactions, fulfill orders, communicate with individuals placing orders or visiting the online store, and for related purposes.


Pearson may offer opportunities to provide feedback or participate in surveys, including surveys evaluating Pearson products, services or sites. Participation is voluntary. Pearson collects information requested in the survey questions and uses the information to evaluate, support, maintain and improve products, services or sites, develop new products and services, conduct educational research and for other purposes specified in the survey.

Contests and Drawings

Occasionally, we may sponsor a contest or drawing. Participation is optional. Pearson collects name, contact information and other information specified on the entry form for the contest or drawing to conduct the contest or drawing. Pearson may collect additional personal information from the winners of a contest or drawing in order to award the prize and for tax reporting purposes, as required by law.


If you have elected to receive email newsletters or promotional mailings and special offers but want to unsubscribe, simply email information@informit.com.

Service Announcements

On rare occasions it is necessary to send out a strictly service related announcement. For instance, if our service is temporarily suspended for maintenance we might send users an email. Generally, users may not opt-out of these communications, though they can deactivate their account information. However, these communications are not promotional in nature.

Customer Service

We communicate with users on a regular basis to provide requested services and in regard to issues relating to their account we reply via email or phone in accordance with the users' wishes when a user submits their information through our Contact Us form.

Other Collection and Use of Information

Application and System Logs

Pearson automatically collects log data to help ensure the delivery, availability and security of this site. Log data may include technical information about how a user or visitor connected to this site, such as browser type, type of computer/device, operating system, internet service provider and IP address. We use this information for support purposes and to monitor the health of the site, identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents and appropriately scale computing resources.

Web Analytics

Pearson may use third party web trend analytical services, including Google Analytics, to collect visitor information, such as IP addresses, browser types, referring pages, pages visited and time spent on a particular site. While these analytical services collect and report information on an anonymous basis, they may use cookies to gather web trend information. The information gathered may enable Pearson (but not the third party web trend services) to link information with application and system log data. Pearson uses this information for system administration and to identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents, appropriately scale computing resources and otherwise support and deliver this site and its services.

Cookies and Related Technologies

This site uses cookies and similar technologies to personalize content, measure traffic patterns, control security, track use and access of information on this site, and provide interest-based messages and advertising. Users can manage and block the use of cookies through their browser. Disabling or blocking certain cookies may limit the functionality of this site.

Do Not Track

This site currently does not respond to Do Not Track signals.


Pearson uses appropriate physical, administrative and technical security measures to protect personal information from unauthorized access, use and disclosure.


This site is not directed to children under the age of 13.


Pearson may send or direct marketing communications to users, provided that

  • Pearson will not use personal information collected or processed as a K-12 school service provider for the purpose of directed or targeted advertising.
  • Such marketing is consistent with applicable law and Pearson's legal obligations.
  • Pearson will not knowingly direct or send marketing communications to an individual who has expressed a preference not to receive marketing.
  • Where required by applicable law, express or implied consent to marketing exists and has not been withdrawn.

Pearson may provide personal information to a third party service provider on a restricted basis to provide marketing solely on behalf of Pearson or an affiliate or customer for whom Pearson is a service provider. Marketing preferences may be changed at any time.

Correcting/Updating Personal Information

If a user's personally identifiable information changes (such as your postal address or email address), we provide a way to correct or update that user's personal data provided to us. This can be done on the Account page. If a user no longer desires our service and desires to delete his or her account, please contact us at customer-service@informit.com and we will process the deletion of a user's account.


Users can always make an informed choice as to whether they should proceed with certain services offered by InformIT. If you choose to remove yourself from our mailing list(s) simply visit the following page and uncheck any communication you no longer want to receive: www.informit.com/u.aspx.

Sale of Personal Information

Pearson does not rent or sell personal information in exchange for any payment of money.

While Pearson does not sell personal information, as defined in Nevada law, Nevada residents may email a request for no sale of their personal information to NevadaDesignatedRequest@pearson.com.

Supplemental Privacy Statement for California Residents

California residents should read our Supplemental privacy statement for California residents in conjunction with this Privacy Notice. The Supplemental privacy statement for California residents explains Pearson's commitment to comply with California law and applies to personal information of California residents collected in connection with this site and the Services.

Sharing and Disclosure

Pearson may disclose personal information, as follows:

  • As required by law.
  • With the consent of the individual (or their parent, if the individual is a minor)
  • In response to a subpoena, court order or legal process, to the extent permitted or required by law
  • To protect the security and safety of individuals, data, assets and systems, consistent with applicable law
  • In connection the sale, joint venture or other transfer of some or all of its company or assets, subject to the provisions of this Privacy Notice
  • To investigate or address actual or suspected fraud or other illegal activities
  • To exercise its legal rights, including enforcement of the Terms of Use for this site or another contract
  • To affiliated Pearson companies and other companies and organizations who perform work for Pearson and are obligated to protect the privacy of personal information consistent with this Privacy Notice
  • To a school, organization, company or government agency, where Pearson collects or processes the personal information in a school setting or on behalf of such organization, company or government agency.


This web site contains links to other sites. Please be aware that we are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of each and every web site that collects Personal Information. This privacy statement applies solely to information collected by this web site.

Requests and Contact

Please contact us about this Privacy Notice or if you have any requests or questions relating to the privacy of your personal information.

Changes to this Privacy Notice

We may revise this Privacy Notice through an updated posting. We will identify the effective date of the revision in the posting. Often, updates are made to provide greater clarity or to comply with changes in regulatory requirements. If the updates involve material changes to the collection, protection, use or disclosure of Personal Information, Pearson will provide notice of the change through a conspicuous notice on this site or other appropriate way. Continued use of the site after the effective date of a posted revision evidences acceptance. Please contact us if you have questions or concerns about the Privacy Notice or any objection to any revisions.

Last Update: November 17, 2020