What is Data Warehouse?

Data warehousing is an essential topic in both business and data science. If you’re new to the field, you may be wondering what a data warehouse is, why we need it, and how it works. Don’t worry, I’ll provide answers to all these questions.

Let’s start first with the definition of a Data Warehouse.

Definition

A Data Warehouse is a centralized repository of structured data that is specifically designed to support Business Intelligence (BI). BI is used to create and view the business analytics of an organization.

A data warehouse is a repository where organizations store their crucial data assets, such as customer data, sales data, employee data, and more. It serves as the primary source of data truth for an organization, providing a centralized location for all the data. Typically, data warehouses are created and used for data reporting and analysis purposes.

Defining Features

There are several defining features of a data warehouse. It is subject-oriented, integrated, time-variant, non-volatile, and summarized.

Let’s quickly go through this one-by-one:

  1. Subject-oriented means that the information in the data warehouse revolves around some subject therefore it does not contain all company data but only the subject matters of interest for instance data on your competitors need not appear in a data warehouse however your own sales data will most certainly be there.
  1. integrated means each database or each team or even each person has their own preferences when it comes to naming conventions. That is why common standards are developed to make sure that the data warehouse picks the best quality data from everywhere. This relates to master data governance.
  1. Time variant relates to the fact that a data warehouse contains historical data too. We mainly use a data warehouse for analysis and reporting which implies we need to know what happened five or ten years ago.
  1. Non-volatile implies that the data only flows in the data warehouse as is once there it cannot be changed or deleted.

The data is often used for data analytics, which involves aggregating or segmenting it in some way to facilitate analysis and reporting for an organization. This is a crucial aspect of business intelligence initiatives, as it helps organizations make informed decisions and improve their operations.

 Conclusion

In light of the mentioned facts, we can say that a data warehouse is a structured, non-volatile single source of truth for a company.

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