Advantages of Data Warehouse

What is Data Warehousing?

A data warehousing is an electronic storage technique that involves the following steps;

  • Collecting the data
  • Managing the data from different
  • Implementing the techniques and technologies
  • Understanding the data
  • Generating the results
  • Showing the results keeping in view the human-computer interaction and usability standards.

Alternative names of Data warehouse

A data warehouse is the most common name but some other names are also well known in computer science. Some of the famous names are mentioned below;

  • Decision Support System
  • Business Intelligence Solution
  • Analytic Application
  • Executive Information System
  • Data Warehouse
  • Management Information System

Why  Data Warehouse (DWH) is important?

The cost of CPUs is decreasing and the performance is improving day by day. Similarly, the data storage capacity of storage devices is also increasing day by day.

For example, you are living in a hostel and your briefcase is small and you have put more and more things in this tiny briefcase. In this situation, what is the best solution? The best solution is to change the small briefcase with a large one. Similarly, the amount of data in the databases is doubled every year. That’s why we need to maintain a data warehouse.

Data is increasing day by day, so big organizations need to maintain the data warehouse. Size of Data Sets are going up and the cost of the data storage is decreasing day by day.

1MB (Megabyte) 1000 KB (Kilobyte) Most songs are in MB’s
1GB (Gigabyte) 1000 MB Most movies are in GB’s
1TB (Terabyte) 1000 GB 50,000  trees  chopped  and  converted  into paper and printed
2PB (Petabyte) 2000 TB Academic research libraries across the U.S.
5EB (Exabyte) 5000 PB All words that can be spoken by human beings

DBMS Approach VS Intelligent Enterprise (Data Warehouse Approach)

Let’s see the Comparison of queries of DBMS Approach VS Intelligent Enterprise (Data Warehouse Approach).

DBMS Approach Intelligent Enterprise (Data Warehouse Approach)
How many people call in Morning?

How many people call in the evening?

How many people call at night time?

Mobile companies decide that free call packages are best suitable for night calls or day calls.
How much money spent on advertisement in Pakistan in June 2019.

How many sales increase after advertisement in Pakistan in June 2019.

How much profit increase after advertisement in Pakistan on June 2019.

How much money needs to spend on advertisement in Pakistan?

Advantages of Data Warehousing

Advantages of Data Warehouse

If you are able to successfully implement a reliable and efficient data warehouse, then it can be very helpful for an organization in generating more revenue. Data warehousing has many advantages. Some of these advantages are mentioned below.

Competitive advantage

The organization with a data warehouse will mostly result in greater profit as compared to its competitors. The competitive advantage can be gained by allowing the owners or decision-makers in such a way that they can get access to the data results. For example trends of the product sale etc.

More returns on investment (RO I)

It is very costly to Implement the data warehouse by an organization. However, International Data Corporation (IDC) investigates the impact of data warehouse on profit and loss of companies. After their research in 1996, they concluded that average three-year returns on investment in data warehousing are reached to 401%.

Return on investment (ROI) can be defined as a ratio between the net profit of the organization the and cost of investment.

Better enterprise intelligence.

It helps to provide better enterprise intelligence by answering the following questions.

  • Which are the customer who gives the organization more profit?
  • Who are the customers of the product?
  • Which product is the most popular in the sale?
  • What will be the impact of new products on profit or loss?
  • What kind of advertisement method leads to more sales?
  • What is the most effective distribution channel?

Increased productivity of corporate decision-makers

Data warehouse consists of an integrated database of a large amount of historical data. Data warehouse helps the decision-makers to see the results from subject-oriented, consistent, non-redundant, accurate and historical data. Data warehouse helps inaccurate, and consistent analysis of the data.