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How Does Data Warehousing Work?

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Once the decision has been made to create a data warehouse for a business, the real work can begin. Because future strategic planning will rely heavily on the information gleaned from the data warehouse, the most helpful information must be preserved. First and foremost it must be remembered that information in the data warehouse will not be the most current business information, but rather a cross section of the business made up of only the most important data. Deciding what that data should be should include those records that present the most accurate picture of the business and its overall operations at any given point in time.

To make these decisions, it must be decided which information will be included, and which will be excluded. Separating what will not be needed in the future can be a more extensive process than deciding what might be needed. If your company is a small to medium sized, local business, you may be able to warehouse an overall business system that is a compilation of all the relevant data. However, if your business is a large, multinational company, or if a local business has the real potential of becoming a multinational entity, it might serve you well to compartmentalize your data warehouse into smaller units called data marts. Data marts are smaller subsections of information created with records gleaned from only one department or section of the company. These smaller divisions of data can make creating relevant reports much simpler in the future.

Since a data warehouse is made up of millions of pieces of individual information, it makes sense that the information must be organized in a logical manner so that reports can be generated that will be of value to the company. Some of the components to consider when planning and organizing the data ware house are:

1. What data should be conserved?
2. How will that data be prepared for warehousing?
3. How and where will the data warehouse be stored?
4. How often will updates be needed and how will they be performed?
5. How will data be retrieved and in what format?
6. How will the cost of the data warehouse be budgeted?
7. Who will have access to the information in the data warehouse?
8. How will the data warehouse be managed, and by whom?

Next Page: What is a Data Mart?

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