What Business Leaders Should Know About Data Warehouse Solutions
Dear LinkedIn Community,
Welcome back to our bi-weekly IT Talks!
In today’s edition, we’re going to discuss data warehouse technology. If you wonder about the topic choice, there’s no mystery behind it. Do you know much about data warehousing? Most likely, you’ve heard about it but don’t really know what role it plays in business operations that involve large amounts of data. And most modern business operations do.?
Now you understand where we’re coming from. While helping companies address their needs, we see that many deal with a trove of digital information and require robust technology to make the most out of it. And here, data warehouse solutions can save the day. So, let’s explore the key things you might want to know about them.??????
Q1: What is a data warehouse and why do we need it?
Naturally, we’re starting with the basics. A data warehouse refers to a centralized repository that stores data from multiple sources in an organized and easily accessible manner. These sources can be sales, marketing, finance, or any other operations that the business revolves around.
To make it more simple, we can compare a data warehouse to a library, where each book is a piece of data. When you need to find specific information, you visit the library, choose the right section, and locate the book that contains the data you’re looking for.?
With this allegory, it’s easy to see that the library building itself is your data warehouse solution. It is a place where all your data is stored and centralized from various sources within a business.?
Then, we have different sections and shelves in the library that represent how data is organized within the data warehouse. Similar to the books in the library, your data is categorized into different groups, making it easy to query and analyze.?
And finally, there’s the library’s catalog system that helps you locate books. It’s akin to the metadata, which tells where data is stored, its format, and how it can be accessed. So, you see, understanding data warehouses is a no-brainer, but why after all, does one need it?
Well, when all is organized this way, data management becomes more effective. Consolidating data from disparate sources into a unified view enables more accurate reporting, analysis, and decision-making. It even helps understand the business better, identify trends, and build a data-driven strategy.
Q2: How does a data warehouse differ from a regular database?
Now you may think what’s the difference then between a regular database and a warehouse solution? It’s true that both store data, but they serve various purposes and have distinct characteristics. Let’s review them.
Purpose
To begin with, regular databases are optimized for transactional processing, including day-to-day operations like order processing. On the other hand, data warehouses are optimized for analytical processing. So, you can run complex queries to analyze historical data.
Data Structure
The next difference lies in the data structure. With regular databases, you have a normalized structure to minimize redundancy and maintain data integrity. However, data warehouses use a denormalized structure like star schema or snowflake. While this tech jargon might be overwhelming, trust us that this kind of structure enhances query performance.
Data Integration
This one is simple. As we’ve already said, data warehouses integrate information from multiple sources, providing a comprehensive view of the business. On the contrary, regular databases often deal with a single source or system.
Query Performance
While regular databases prioritize fast transaction processing, data warehouses are designed to handle large volumes of data and complex queries efficiently. It essentially makes them suitable for generating insights and reports.
Q3: How user-friendly is the data warehouse?
How user-friendly do you want it to be? Eventually, it all comes down to your requirements and your team skills. Modern data warehouses support intuitive interfaces and tools that allow you to handle data effortlessly.?
Business users can access data warehouses through dashboards, reporting tools, and data visualization software that require minimal technical expertise. These tools often come with drag-and-drop features and pre-built templates, making it easy for non-technical users to generate reports and perform data analysis.?
Additionally, data warehouses support various query languages, such as SQL, which is widely known and used in business environments. It bridges the gap between data storage and analysis, enabling business users to manipulate data efficiently. Fundamentally, such support enhances the usability of data warehouses and provides strategic access to business intelligence.?
In the end, if you have the right team on board, then leveraging query languages will be no problem. So, let’s see what it should consist of.
Q4: Who will need to be involved in the data warehouse project?
As you may guess, a successful data warehouse project requires involvement from various stakeholders across the organization. Primarily, business leaders and managers should be actively engaged in the project to provide strategic direction and define business requirements.
Easy to tell that someone should coordinate all the tasks, manage timelines, and ensure that milestones are met. Thus, you want an effective project manager to guide your endeavor. And then goes the most interesting part. You need data experts.
There are various activities to handle, from integrating data and building data warehouse architecture to designing data models, queries, and analysis. These can be covered by engaging the following specialists:
Of course, it doesn’t mean that your project should necessarily cover all the mentioned roles. It all depends on the goals and the solution’s complexity. On top of that, don’t forget to allow end users to participate in your initiative at the final project stage. They are the ones to benefit from a data warehouse, so collect their feedback and implement improvements.??
Q5: Can we integrate our existing systems with the data warehouse?
If you read between the lines, then you already know the answer. Enterprise data warehouses feature the ability to integrate data from multiple existing systems. This includes but is not limited to CRM and ERP software, databases, cloud applications, and external solutions.?
It’s possible thanks to the ETL process that extracts data from various sources, transforms it into a consistent format, and loads it into the warehouse. Moreover, many data warehouse solutions come with built-in connectors and integration tools that facilitate seamless integration with a wide range of systems.
Q6: What kind of reports and analytics can we generate from a data warehouse?
A data warehouse truly empowers business leaders and analysts to gain deeper insights, make informed decisions, and drive strategic initiatives. All of that is based on comprehensive and reliable data. And all of that isn’t possible without reports and analytics. What are they? Let’s go over a few examples.?
Imagine that you are to improve daily operations like sales performance, inventory levels, or customer transactions. In this case, operational reports will come into play. If you want to address some specific scenario, then ad-hoc reports can help as they’re generated on the fly whenever you need them.?
Predictive analytics will help you look into the future by using historical data and making predictions about upcoming events, whether they are sales forecasts or risk assessments. If you rather want to see the whole picture, trend analysis is at your service. It also leverages historical data but uses it to identify trends, patterns, and anomalies over time.
Plus, there are various dashboards that provide at-a-glance insights into business performance. Custom or pre-built — the choice is yours, and the possibilities are almost limitless. With custom data warehouse solutions, all reports can be personalized and adjusted according to your unique requirements.?
Tap Into the Full Potential of Your Data
We’ve highlighted the key moments in data warehousing that will surely help you on your way to effective data management and analysis. However, you also need an experienced tech team by your side. Whether it’s in-house or external, make sure they have enough skills working with data solutions.
If data warehouse implementation is one of your priorities at this time and you lack expertise internally, Velvetech is ready to help. We also encourage those having more questions on this and other IT topics to use the comment section below and ask them. We’ll be here with the answers in the upcoming newsletters. So, stay tuned.???