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The systems used earlier attempted to automate the established business

processes by leveraging the power of computers to obtain significant
improvements in efficiency and speed. However, in today’s business
environment, efficiency or speed is not the only key for competitiveness.
Today, multinational companies and large organizations have operations
in many places within their origin country and other parts of the world.
Each place of operation may generate large volume of data. For example,
insurance companies may have data from thousands of local and external
branches, large retail chains have data from hundreds or thousands of
stores, large manufacturing organizations having complex structure may
generate different data from different locations or operational systems
and so on.
Therefore, the business of the 21st century is the competition between
business models and the ability to acquire, accumulate and effectively use
the collective knowledge of the organization. It is the flexibility and
responsiveness that differentiates competitors in the new Web enabled e-
business economy. The key to success of the modern business will depend
on an effective data management strategy of data warehousing and
interactive data analysis capabilities that culminates with data mining.
Data warehousing systems have emerged as one of the principal
technological approaches to the development of newer, leaner, meaner
and more profitable corporate organizations.
Data Warehousing
A Data Warehouse is a subject oriented, integrated, time variant, non-
volatile collection of data in support of management’s decisions. There are
following components of this definition:
 Subject Oriented
 Integrated
 Time Variant
 Non Volatile
The Primary goals of a Data warehouse are the following:
 Provide access to the data of an organization
 Data consistency
 Capacity to separate and combine data
 Inclusion of tools set to query, analyze and present information
 Publish used data
 Drive business reengineering

Data Warehousing has triggered an era of information based

management, which provides the following advantages to the end users:
1. A single information source
2. Distributed information availability
3. Providing information in a business context
4. Automated information delivery
5. Managing information quality and ownership
Data Warehousing typically delivers information to users in one of the
following formats:
1. Query and reporting
2. Online Analytical Processing (OLAP)
3. Statistical Analysis
4. Data Mining
5. Graphical/Geographic System

Characteristics of Data Warehouses

Data Warehouses have the following distinct characteristics:
1. Multidimensional conceptual view
2. Unlimited dimensional and aggregation levels
3. Unrestricted cross-dimensional operations
4. Dynamic matrix handling
5. Client/Server Architecture
6. Multi user support
7. Accessibility
8. Transparency
9. Data Manipulation
10. Consistent reporting performance
11. Flexible reporting

Benefits of Data Warehouses

1. High return of investments (ROI)
2. More cost-effective decision-making
3. Competitive Advantage
4. Better enterprise intelligence
5. Increased productivity of corporate decision-makers
6. Enhanced customer service
7. Business and information re-engineering

Limitations of Data Warehouses

1. It is query intensive
2. Data Warehouse themselves tend to be very large, may be in the
order of TBs, as a result the performance tuning is hard
3. Scalability can be a problem
4. Hidden problems with various sources
5. Increased end user demands
6. High demand of resources
7. High maintenance
8. Complexity of integration
Main components of Data Warehouses
Following are the three components that are supported by data
1. Data Acquisition
2. Data Storage
3. Data Access

Data Warehouse Architecture

A typical architecture of data warehouse contains:
1. Operational and external data sources
2. Data Warehouse DBMS
3. Repository System
4. Data Marts
5. Application Tools
6. Management Platform
7. Information delivery system
Structure of a Data Warehouse
1. Physical Data warehouse
2. Logical Data warehouse
3. Data marts
Physical Data warehouse – Physical database in which all the data for
the data warehouse are stored along with metadata and processing logic
for scrubbing, organizing, packaging and processing the detail data.
Logical Data warehouse – The logical data warehouse contains
metadata including enterprise rules and processing logic for scrubbing,
organizing, packaging and processing the detail data, but does not contain
actual data. Instead it contains the information necessary to access the
data wherever they reside.
Data Mart – Data mart is a subset of an enterprise-wide data warehouse
which typically supports an enterprise element. As a part of an iterative
data warehouse development process, an enterprise builds a series of
physical or logical data marts over time and links them via an enterprise-
wide logical data warehouse or feeds them from a single physical
Data Warehousing Process Overview
The following are the major components of data warehousing process:
1. Data Sources
2. Data extraction and transformation
3. Data loading
4. Comprehensive database
5. Metadata
6. Middleware tools
Data Warehousing Architectures
1. A Three-Tier Data Warehouse

2. A Two-Tier Data Warehouse

3. Web-based Data Warehouse

Representation of data in Data warehouse
Many variations of data warehouse architecture are possible. No matter
what are the architecture was, the design of data representation in the
data warehouse has always been on the concept of dimensional
modelling. Dimensional modelling is a retrieval-based system that
supports high volume query access. Representation and storage of data in
a data warehouse should be designed in such a way that not only
accommodates but also boosts the processing of complex
multidimensional queries. The means by which dimensional modelling is
implemented in data warehouses are:
1. Star Schema

2. Snowflake Schema