1. Mathematical models play an important role in business intelligence systems by providing decision makers with information and knowledge extracted from data through the application of models and algorithms. 2. Mathematical models in BI can take different forms but generally include variables, parameters, and metrics to evaluate alternative options through what-if analysis. 3. The BI cycle involves four phases - analysis, insight, decision, and evaluation - to transform data into information, knowledge, decisions, and actions.

1. Sanjivani Rural Education Society’s
Sanjivani College of Engineering, Kopargaon-423 603
(An Autonomous Institute, Affiliated to Savitribai Phule Pune University, Pune)
NACC ‘A’ Grade Accredited, ISO 9001:2015 Certified
Department of Computer Engineering
(NBA Accredited)
Prof. S.A.Shivarkar
Assistant Professor
E-mail :
shivarkarsandipcomp@sanjivani.org.in
Contact No: 8275032712
Subject- Business Intelligence
Unit-I: Concepts with Mathematical treatment

2. Role of Mathematical Model in BI
A Business Intelligence system provides decision
makers with information and knowledge extracted
from data, through the application of mathematical
models and algorithms.
• First, the objective of the analysis are identified and the
performance indicators that will be used to evaluate
alternative option defined.
• Mathematical models are then developed by exploiting the
relationship among system control variables, parameters
and evaluation metrics.
• Finally, What-if analysis are carried out to evaluate the
effects on the performance determined by variations in the
control variables and changes in the parameters.

3. Role of Mathematical Model in BI

4. Mathematical model have been developed and used in many
application domain, ranging from Physics to architecture, from
engineering to economics.
The model adopted in various contexts differ substantially in terms
of their mathematical structure .
However, it is possible to identify a few fundamental features
shared by most models.
Structure of Mathematical Models
A model is a selective abstraction of reality

5. • According to their characteristics, models can be divided
into Iconic, Analogical, and Symbolic.
• A further relevant distinction concerns the probabilistic
nature of models, which can be either Stochastic or
Deterministic.
• A further distinction concerns the temporal dimension in a
mathematical model, which can be either Static or Dynamic.
Structure of Mathematical Models

6. BI Cycle

7. BI Cycle
Analysis
 To recognize and accurately spell out the problem
 Create a mental representation of the phenomenon being analysed
 It leads decision makers to ask several questions and to obtain quick
responses in an interactive way.
Insight
 It allows decision makers to better and more deeply understand the
problem at hand
 The information obtained through the analysis phase is then
transformed into knowledge during the insight phase

8. BI Cycle
Decision
 During the third phase, knowledge obtained as a result of the insight
phase is converted into decisions and subsequently into actions.
 Timely decisions can be made that better suit the strategic priorities of a
given organization.
Evaluation
 It involves performance measurement and evaluation
 Extensive metrics should then be devised that are not exclusively
limited to the financial aspects but also take into account the major
performance indicators defined for the different company departments.

9. BI Users/Categories of BI Users
Executives
• Information is summarized and has been defined for them.
Users have the ability to view static information online
and/or print to a local printer.
Casual Users
• Casual users require the next level of detail from the
information that is provided to viewers. In addition to the
privileges of a viewer, casual users have the ability to refresh
report information and the ability to enter desired
information parameters for the purposes of performing high-
level research and analysis.

10. BI Users/Categories of BI Users
Functional Users
• Functional users need to perform detailed research and
analysis, which requires access to transactional data. In
addition to the privileges of a casual user, functional users
have the ability to develop their own ad hoc queries and
perform OLAP analysis.
Super Users
• Super users have a strong understanding of both the
business and technology to access and analyze transactional
data. They have full privileges to explore and analyze the data
with the BI applications available to them.