What is a Data Warehouse? Everything You Need to Know


As a term, a data warehouse has been around for many years. But it wasn’t until the last decade that businesses really embraced them as a way to drive better insights and decisions from their data. Today, even though they’re mostly associated with massive organizations, anyone can benefit from using them. In this article we’ll answer some common questions about what exactly a data warehouse is, how it came about, and why should you care.

What is a data warehouse?

Most simply put, a data warehouse contains summarized transactional data from your company or organization. Instead of storing all of your raw transactional information in one place – which would take up huge amounts of storage space and be difficult to analyze – you separate out the important pieces of data. These are stored in a warehouse, which usually takes up less room because only the summarized information is stored there.

How did Data Warehouses evolve?

In order to understand how data warehouses came about, we have to look at their predecessor: operational data stores (ODSs). As it turned out, companies were struggling with utilizing all the raw incoming information that they were collecting from their customers. It was just too much–and too complex–to try and utilize everything as-is. The dawn of knowledge management and decision support systems introduced new technologies for summarizing this vast amount of transactional information into reports and other forms which users could better understand and use. Thus, data warehouses were born.

What are the benefits of a Data Warehouse?

The main benefit is that they allow for effective decision support by making it easier to access and analyze information without having to sift through all the raw transactional information. The summarized nature of this data means you can get quick answers to questions like “how much did we sell last month?” or “what products are most likely to be purchased together?” This direct access enables users to make better decisions about their business in less time, which ultimately leads to increased company performance.  

Who should use them?

Anyone! Smaller organizations can take advantage of these technologies too but often choose not to because they don’t feel like they have enough data to justify a data warehouse. This is a mistake – the main benefit of a data warehouse is that it makes accessing and analyzing your information much easier, no matter how much you have. In addition, anyone who needs to make better decisions from the data they already have should be using one.

A data warehouse is a structure that contains summarized transactional data. They are usually used to make better decisions about your business by making it easier for you to access and analyze the information in-depth without having to sift through all of it. The main benefit of using one is that they allow users to get quick answers to important questions like “How much did we sell last month?” or “What products are most likely purchased together?” Anyone can use them, but smaller organizations often don’t because they don’t feel like they have enough data – this is wrong! If you need help getting started with structuring your own, our team would love to partner up with you and create an SEO or marketing plan that will drive results. Feel free to contact us for more information at any time!

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