What is a data warehouse? If this is your first time seeing this concept, be sure to keep reading. This article will help IT newbies and business owners get a concise data warehouse definition. This simultaneously simple and effective solution will help to reduce the cost of storing commercial information, while maintaining its complete security. We will also tell you more about the data warehouse best practices and tools.

Benefits of a data warehouse

Companies that have already adopted the experience of using such solutions have noted two main advantages over other methods of automating business processes:

  1. More accurate analytics. The system automatically brings the collected data into an up-to-date database. Thus, it is easier for the business owner to make informed decisions.
  2. Faster analytics. The system can be configured to process data as often as needed. Thus, reports on the company’s performance can be received immediately in real time.

Let’s define data warehousing

Data warehouse concepts include a large set of business data that helps an organization make decisions. This idea arose about 40 years ago to make it easier to accumulate large amounts of information. All this information has become much easier to combine for end-to-end analytics. One repository is capable of receiving and processing information from different sources:

  • Internal applications of the company;
  • Marketing,
  • Fintech class software;
  • Customer bases and product catalogs;
  • Computer systems of external partners.

The frequency of data extraction and how it is formatted can be customized based on your business needs.

Data Warehouse Architecture

The structure of the system can be different, depending on the needs of the business. There are several common types:

  • Simple. Administrator-supplied metadata, summary data, and incoming raw data end up in the central repository of the repository. The repository is constantly available for monitoring and generating reports.
  • Simple with a staging area. To simplify the processing of incoming new data, an intermediate department is provided. In it, preliminary preparation and sorting of new information takes place. Then the already processed information goes to the main storage.
  • Hub and spoke. This type is suitable if the company conducts several different types of activities. Injecting data marts between the central repository and users allows data to be sorted and displayed to a custom roster of employees.
  • Sandboxes. This type does not use strict regulations and storage protocols. Users can freely operate with any data sets and methods of their analysis. The system is private and protected from unauthorized access.

The future of the data warehouse

Cloud storage of information provides business owners with the following bonuses:

  • Cheaper secure storage of large amounts of information;
  • Diverse tools for end-to-end analytics and reporting;
  • Ability to configure partial or limited access depending on the job responsibilities of employees;
  • Access from anywhere with Internet access;
  • Ability to share one document by several employees at the same time.

This approach is ideal for startups. A company does not need to spend a lot of money on expensive equipment and software to protect business data. If an already existing company plans to expand the scale of its activities, it will also not have to increase its computer park. The amount of virtual memory can be increased or decreased according to current needs.