Basics of a Data Warehouse

A data warehouse is one of the main tools that help in smooth operation in various departments of an organization. It is very important that each and every company whether big or small, has an independent data warehouse.

A data warehouse helps company executives, business analysts and managers of an organization take decisions based on the report procured by the data warehouse. Let us find out the main reasons why a data warehouse is used for in an organization.

1- Validation – Research has proved that almost about 45% of the companies use data warehouse for the purpose of validation. Let us take an example – Let us say that a popular candy bar is having its branches in different parts of the USA. Some customers from a city like New York will buy candy bars on a whim while other customers like those from Denver might not do so. Data storage will record each and every purchase from different stores and create a data.

2- Tactical Reporting – There are 40% of companies using data warehouse for tactical reporting. For example – A salesman of a particular organization might meet Mr. X, a potential client and would like to know what products Mr. X purchased last year. Similarly, he might meet another potential client Mr. Y and find out what Mr. Y purchased last year. They will then make use of the data warehouse to find out the comparison between the two clients. This is what we call tactical reporting.

3- Exploration – Exploration with the help of data warehouse helps companies search for new ideas and knowledge which they might have never heard of before. Use of data mining techniques like association, genetic algorithms, applications and classification which also include market analysis and fraud detection work as important tools. Research has proved that 15% of companies use data warehouse for the purpose of exploration.