Data Warehousing

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A data warehouse is a centralized system used for storing and managing large
volumes of data from various sources. It is designed to help businesses analyze
historical data and make informed decisions. Data from different operational
systems is collected, cleaned, and stored in a structured way, enabling efficient
querying and reporting.
• Goal is to produce statistical results that may help in decision-making.
• Ensures fast data retrieval even with the vast datasets.

Need for Data Warehousing

1. Handling Large Volumes of Data: Traditional databases can only store a limited
amount of data (MBs to GBs), whereas a data warehouse is designed to handle much
larger datasets (TBs), allowing businesses to store and manage massive amounts of
historical data.
2. Enhanced Analytics: Transactional databases are not optimized for analytical
purposes. A data warehouse is built specifically for data analysis, enabling
businesses to perform complex queries and gain insights from historical data.
3. Centralized Data Storage: A data warehouse acts as a central repository for all
organizational data, helping businesses to integrate data from multiple sources and
have a unified view of their operations for better decision-making.
4. Trend Analysis: By storing historical data, a data warehouse allows businesses
to analyze trends over time, enabling them to make strategic decisions based on past
performance and predict future outcomes.
5. Support for Business Intelligence: Data warehouses support business
intelligence tools and reporting systems, providing decision-makers with easy access
to critical information, which enhances operational efficiency and supports data-
driven strategies.
Components of Data Warehouse
The main components of a data warehouse include:
• Data Sources: These are the various operational systems, databases, and
external data feeds that provide raw data to be stored in the warehouse.
• ETL (Extract, Transform, Load) Process: The ETL process is responsible for
extracting data from different sources, transforming it into a suitable format,
and loading it into the data warehouse.
• Data Warehouse Database: This is the central repository where cleaned and
transformed data is stored. It is typically organized in a multidimensional
format for efficient querying and reporting.
• Metadata: Metadata describes the structure, source, and usage of data within
the warehouse, making it easier for users and systems to understand and work
with the data.
• Data Marts: These are smaller, more focused data repositories derived from
the data warehouse, designed to meet the needs of specific business
departments or functions.
• OLAP (Online Analytical Processing) Tools: OLAP tools allow users to
analyze data in multiple dimensions, providing deeper insights and supporting
complex analytical queries.
• End-User Access Tools: These are reporting and analysis tools, such as
dashboards or Business Intelligence (BI) tools, that enable business users to
query the data warehouse and generate reports.

Characteristics of Data Warehousing

Data warehousing is essential for modern data management, providing a strong
foundation for organizations to consolidate and analyze data strategically. Its
distinguishing features empower businesses with the tools to make informed
decisions and extract valuable insights from their data.
• Centralized Data Repository: Data warehousing provides a centralized
repository for all enterprise data from various sources, such as transactional
databases, operational systems, and external sources. This enables organizations
to have a comprehensive view of their data, which can help in making informed
business decisions.
• Data Integration: Data warehousing integrates data from different sources into
a single, unified view, which can help in eliminating data silos and reducing
data inconsistencies.
• Historical Data Storage: Data warehousing stores historical data, which
enables organizations to analyze data trends over time. This can help in
identifying patterns and anomalies in the data, which can be used to improve
business performance.
• Query and Analysis: Data warehousing provides powerful query and analysis
capabilities that enable users to explore and analyze data in different ways. This
can help in identifying patterns and trends, and can also help in making
informed business decisions.
• Data Transformation: Data warehousing includes a process of data
transformation, which involves cleaning, filtering, and formatting data from
various sources to make it consistent and usable. This can help in improving
data quality and reducing data inconsistencies.
• Data Mining: Data warehousing provides data mining capabilities, which
enable organizations to discover hidden patterns and relationships in their data.
This can help in identifying new opportunities, predicting future trends, and
mitigating risks.
• Data Security: Data warehousing provides robust data security features, such
as access controls, data encryption, and data backups, which ensure that the
data is secure and protected from unauthorized access.

Types of Data Warehouses

The different types of Data Warehouses are:
1. Enterprise Data Warehouse (EDW): A centralized warehouse that stores data
from across the organization for analysis and reporting.
2. Operational Data Store (ODS): Stores real-time operational data used for day-
to-day operations, not for deep analytics.
3. Data Mart: A subset of a data warehouse, focusing on a specific business area
or department.
4. Cloud Data Warehouse: A data warehouse hosted in the cloud, offering
scalability and flexibility.
5. Big Data Warehouse: Designed to store vast amounts of unstructured and
structured data for big data analysis.
6. Virtual Data Warehouse: Provides access to data from multiple sources
without physically storing it.
7. Hybrid Data Warehouse: Combines on-premises and cloud-based storage to
offer flexibility.
8. Real-time Data Warehouse: Designed to handle real-time data streaming and
analysis for immediate insights.
Data Warehouse vs DBMS

Database Data Warehouse

A common Database is based on

operational or transactional processing. A data Warehouse is based on analytical
Each operation is an indivisible processing.
transaction.

A Data Warehouse maintains historical

Generally, a Database stores current and data over time. Historical data is the data
up-to-date data which is used for daily kept over years and can used for trend
operations. analysis, make future predictions and
decision support.

A Data Warehouse is integrated generally

at the organization level, by combining
A database is generally application data from different databases.
specific. Example – A data warehouse integrates
Example – A database stores related data, the data from one or more databases , so
such as the student details in a school. that analysis can be done to get results ,
such as the best performing school in a
city.

Constructing a Database is not so Constructing a Data Warehouse can be

expensive. expensive.