What is a data warehouse?
A data warehouse or data warehouse is an information system designed to support business intelligence. The core idea of a data warehouse seems pretty simple on its face. As its name implies, it's a place where companies put all their raw data in one easy-to-access place. But there’s more to building a successful data warehouse than throwing your existing databases into one giant pile. Its success depends on how well you organize that information so that your company can make sense of it in useful ways. Creating a data warehouse requires careful planning and consideration of factors such as physical location, security protocols, user interface design, and even governance policies. In addition to providing quick access to quality information, businesses also want their data warehouses to provide accurate insights with minimal effort.
A data warehouse may seem like a simple concept. It’s a centralized place to store all your company’s information, after all. But there’s a lot more to it than that. Building and maintaining an effective data warehouse requires careful planning, technical know-how, security protocols, and specialized software development—all tasks best left in experts' hands.
By its very nature, a data warehouse enables non-technical people to better understand huge amounts of complex information. And because they provide such ease of access to that information, they're widely used in business intelligence applications as well as other types of analytics software toolsets.
How does a data warehouse benefit your business?
A data warehouse is a huge repository of data that allows users to analyze business trends over time. If you’re already asking yourself why you need one, consider that in today’s fast-paced business world, executives want real-time information about what their company looks like financially. They want to see which regions are profitable and which aren’t. They also want to see how certain shifts in marketing or product placement affect their bottom line. A data warehouse can help businesses with all of these issues by keeping track of customer purchases, enabling financial analysts to compare quarterly profits against monthly profits over a longer period of time. This kind of analysis gives companies valuable insight into how changes at every level—local, regional, and national—affect their results.
For example, let’s say that your company owns several retail stores. Each store should be reporting its monthly sales figures to headquarters. Every month, then, you have a great deal of information on which regions are doing well and which ones aren’t doing as well. However, if all you’re looking at are these monthly figures, you don’t really have a clear picture of how those changes affect your company on a national level.
Why do you need more than one data warehouse?
You probably already know that a data warehouse stores your organization’s data. But did you know you can have more than one? Just like an iceberg, most of a data warehouse’s value lies below its surface. In other words, most of its power to help your business comes from above ground – in features and functions that may not be visible to users who aren't well-versed in database management techniques. According to industry experts, most companies don’t fully utilize their first data warehouse because they don’t realize that their technology should adapt to how they do business, instead of forcing them to change how they operate just so it will fit into existing systems.
You can, of course, use multiple data warehouses to house different types of data. By separating your information into multiple structures – such as a relational database for transactional data and a NoSQL database for unstructured data – you’ll be able to make full use of your valuable information. When choosing a second data warehouse, keep in mind that it doesn't need to be anything as complicated as Hadoop or even something as specific as cloud computing. These buzzwords are useful, but they can quickly become meaningless if you don't have a firm grasp on what they mean or how they could help you accomplish your goals. A second -- or third -- data warehouse may not be necessary for everyone.
Things to consider when choosing the right data warehousing solution for your business
1. Ease of Access - Understanding where to locate and pull your data should be intuitive. Choosing a solution that lets you add data in different ways will give you more control over which format works best for your business processes.
2. Scalability - Regardless of what size your company is today, or how much revenue you’re generating, scaling from thousands to hundreds of thousands or even millions of rows can be easy with some solutions.
3. Performance - The right data warehouse solution should be fast enough to keep up with your business, regardless of how much data you’re working with.
4. Flexibility - Being able to access your data from anywhere at any time can be a game-changer for your business, especially when you’re trying to make quick decisions based on real-time information.
5. Security - Having confidence that your data is secure and only available to those who need it gives you peace of mind as well as better control over compliance issues such as GDPR or HIPAA regulations in Europe or America respectively.
6. Cost - No one wants to pay more than they have to for their technology solutions. It doesn’t matter if it’s storage space, software upgrades, or support – looking into cost savings opportunities can help your business save money without sacrificing quality.
7. Integration - Choosing a data warehouse solution that integrates seamlessly with other systems in use within your company will help streamline processes and save time so you can focus on what really matters – growing your business.
Conclusion
A data warehouse is an invaluable tool for any business or organization looking to collect, consolidate, analyze, and report on key information within their organization. When you fully understand a business’s data warehouse capabilities, it can offer your organization a whole new level of insight into your daily operations. After reading through today’s post on What is a Data Warehouse? I hope that you feel equipped to identify if your own organization has a functional data warehouse and how you might be able to benefit from one should you choose to invest in one for future use. As always, we invite you to ask us any additional questions that may come up throughout your research process regarding what benefits a data warehouse can provide your company!
