Introduction to Data Warehousing and Business Intelligence
Motivating business factors to go for BI & DW:
There are many business drivers in play today that are motivating companies to establish data warehouses. Current, consistent and accurate business information, they believe is critical for strategic and tactical decision making. Some of the business drivers are summarized below.
Single Version of the Truth
Fragmented, inconsistent and outdated data in multiple databases does not permit good strategic and tactical decision making. Companies require that business intelligence be consolidated and presented in a suitable format for decision making. Inconsistent information from disparate information systems is no longer acceptable. Data Warehouses help companies to achieve a single version of the truth by consolidating the most accurate and current data from the most reliable systems.
Current and Accurate Information
In a highly competitive market place, businesses need to quickly identify problems and opportunities and respond to events expeditiously and appropriately. Up-to-date information on sales, profits, inventories and customers can help identify problems early and leverage opportunities that could otherwise be missed. Most application systems are too narrowly scoped and operate on cycles that don't support real-time or near real-time information access. A data warehouse, however, can be designed to deliver up-to-date accurate information to decision makers.
Rapidly Changing Information Needs
It is very difficult for businesses to anticipate future information needs. Application systems often seem rigid and unable to adapt to evolving management information needs. Businesses need the flexibility to slice and dice data in many ways in order to identify and analyze changes in the market place or in the business itself. Data Warehouses are designed for online, analytical purposes and provide great flexibility
Customer Service Excellence
It is often said that 10% of a business's customers account for 90% of the business's profits. Identifying the good customers and providing them with excellent service helps retain good customers. Data Warehousing can help identify a company's best customers using a any number or criterion.
New Service Delivery Channels
It is no longer sufficient to provide customers with just 9:00 AM to 5:00 PM in-store service. Customers want to do business 7 days a week, 24 hours per day using alternate service delivery channels such as via the Internet or telephone. By examining all customer transactions, regardless of the channel used, businesses can better understand their customers and serve them better. Data Warehousing is critical for profiling customers and their transactions, regardless of the channel used.
Multiple Internal Databases
Most medium and large businesses operate dozens, if not hundreds of un-integrated application systems. Individual departments in companies often focus on their own narrow system and information needs and don�t see the corporate value of integrating data. When silos of un-integrated data exist, data soon gets out of synch. Companies have a need for database that reflects a "single version of truth". Data Warehouses can help do that.
Purchased Packages
Out of the Box purchased applications sometimes use underlying concepts and definitions that differ from those used by the business in existing custom built applications. For example, a customer in one system could encompass all current and past customers plus potential future customers. In another system, a customer might be defined more narrowly as someone who has purchased a product and service during the past 12 months. Such inconsistencies create problems from an analytical perspective. A count of customers done in the first database differ from a count done in the second. Companies have a need to align concepts and terminology. Data Warehouses help do this alignment.
Increasing Complexity of Systems
The underlying data structures of application systems are often very complicated. To create what would intuitively might appear to be a simple query often requires complex programming logic that involves navigating multiple database tables and or applications systems. Writing reports or queries can consequently take time and money. Companies have a need for a reporting environment that allows reports and queries to be generated quickly, inexpensively and without expensive IT skills. Data Warehouses can simplify the reporting environment.
Application System Evolution
Businesses are highly dynamic and applications systems are constantly needing to be enhanced to support new business requirements. When systems are changed, reports and queries that access any changed tables must also be updated. This maintenance work can be very costly. Businesses have a need to trim their application support costs. Data Warehouses can help shelter reports and queries from system changes that occur in "front end" operational systems.
Computer Networks and External Databases
The rapid growth of computer networks has allowed companies to exchange data with their suppliers, consumers, government bodies and other groups. Businesses often have a need to integrate data from internal and external databases. Data Warehouse can be designed to to integrate corporate data with external data for reporting purposes.
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