Introduction to Data Warehousing

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A good data warehouse can bring plenty of advantages to modern businesses, regardless of size or industry. Let’s explore the many benefits and advantages with this introduction to data warehousing.

What is a data warehouse?

Simply put, a data warehouse is a system for storing and reporting on all sorts of data that your company has collected. Originating from a multitude of systems and resources, this data, which we refer to as big data, is moved into the data warehouse for analysis, reporting and storage.

From here, your personnel can effortlessly and securely access the information they need at any given time. However, your generated data must be collected, organized and made comprehensible before it can be analysed and acted on. There are plenty of data visualization tools available on the market, and some data warehouse providers also offer these tools as part of their solution.

So, how does data warehousing differ from more conventional databases?

In short, data warehousing technology uses a different infrastructure and design compared to conventional databases. Regular databases are optimized to maintain a level of accuracy in the data it stores via real-time data updates. A data warehouse, on the other hand, is typically designed to provide a broader view of the stored data over a set period of time. This process specialises in data aggregation for analysis and business intelligence activities, instead of maximising transaction processing and volume.

To summarise, a data warehouse is a relational database incorporated in a mainframe server or in the cloud, with the later becoming a more common option in today’s business landscape. Its main purpose is to carefully collect information from various online transaction processing apps (OLTP) and other resources, so that this data can be used in business intelligence activities and decision making.

The Key Components of a Data Warehouse

In general, we tend to say that there are three basic components of a data warehouse. Firstly, there’s the data sources themselves, stemming from various operational tools and applications, such as your ERP solution, CRM system, Excel documents or other financial applications you may use.

Secondly, you’ll find the data staging area where the collected information is sifted, cleaned and organised. And, finally, there’s the presentation component where the data is then warehoused. These warehouses may also provide crucial information to data marts, which are decentralised information systems where your data is sorted and made accessible to key departments, such as sales, marketing, and inventory teams.

What are the advantages of data warehousing?

Data warehousing creates a single, unified system of accurate and up-to-date data storage for an entire organisation. Additionally, a real-time data warehouse is designed to maintain large volumes of data, while keeping the information constantly updated for its users. Without the right solution, maintaining accuracy and thoroughness of big data can be a serious challenge for any organization.

The need for data warehousing typically becomes obvious for organizations handling big data, where conventional operational databases tend to fall short. Performing complex queries on a standard database is often unsustainable, considering the amount of information companies are dealing with these days. A data warehouse is typically employed to run the analysis and processing of raw data, which leaves transactional databases free to do the job it’s meant to do: manage company transactions.

It also offers numerous advantages to organisations from both IT and business perspectives. It enables companies to efficiently separate the analytical processes from the operational processes, meaning the former goes to data warehousing while the latter goes to the conventional organizational databases. This can help improve operational systems and allow personnel to access relevant and up-to-date data from multiple sources, thus greatly enhancing business intelligence.

Organisations have the option of an on-premise system or a cloud-based data warehousing, also known as data warehousing-as-a-service systems. These on-premise solutions are often offered by companies such as Teradata, IBM, and Oracle, where they provide security and flexibility for IT teams by allowing them to get a good grip over their data configuration and management processes.

Cloud-based data warehousing, on the other hand, are provided by providers such as Redshift, Amazon, Microsoft Azure SQL Data Warehouse, Google BigQuery and other top data warehouse vendors allow enterprises and organizations to effortlessly scale the solution according to their needs, while avoiding the initial infrastructure costs and ongoing maintenance investments.

Selecting Your Next Data Warehousing Service

A good data warehousing solution can provide assurance of reliable data quality, a concise and up-to-date history of the stored data, and a single point of access to all information the company needs for analysis and business intelligence. Additionally, it can allow for separation between analytical systems and the day-to-day operational systems for efficiency and security purposes.

Furthermore, storing large volumes of comprehensive data in a structured or organised system means that data warehousing can provide users with answers to a wide variety of complex queries, which include profit rates, average transaction size in a given time period, and percentages of employee turnover in the span of a year.

Their many advantages have led to them become nearly ubiquitous in today’s business landscape. As raw data is flowing in like never before, a data warehousing solution can be one of the solutions that can efficiently sort through the data and find valuable, actionable insights.

Are you considering deploying a data warehousing solution, but don’t know where to start? Our experts here at YourShortlist can put together a bespoke vendor shortlist based on your specific requirements, and even arrange data warehouse demos for your organisation to try out. Are you ready to take your data to the next level in 2019? Get in touch by clicking on the Contact Us button.