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What is Data Warehousing and Why is it Important?

Cloud-based technology has revolutionized the business world, allowing companies to easily retrieve and store valuable data about their customers, products and employees. This data is used to inform important business decisions.

Many global corporations have turned to data warehousing to organize data that streams in from corporate branches and operations centers around the world. It’s essential for IT students to understand how data warehousing helps businesses remain competitive in a quickly evolving global marketplace.

What is data warehousing?

A data warehouse is a system that stores data from a company’s operational databases as well as external sources. Data warehouse platforms are different from operational databases because they store historical information, making it easier for business leaders to analyze data over a specific period of time. Data warehouse platforms also sort data based on different subject matter, such as customers, products or business activities.

Why is data warehousing important?

Data warehousing is an increasingly important business intelligence tool, allowing organizations to:

  1. Ensure consistency. Data warehouses are programmed to apply a uniform format to all collected data, which makes it easier for corporate decision-makers to analyze and share data insights with their colleagues around the globe. Standardizing data from different sources also reduces the risk of error in interpretation and improves overall accuracy.

  2. Make better business decisions. Successful business leaders develop data-driven strategies and rarely make decisions without consulting the facts. Data warehousing improves the speed and efficiency of accessing different data sets and makes it easier for corporate decision-makers to derive insights that will guide the business and marketing strategies that set them apart from their competitors.

  3. Improve their bottom line. Data warehouse platforms allow business leaders to quickly access their organization's historical activities and evaluate initiatives that have been successful — or unsuccessful — in the past. This allows executives to see where they can adjust their strategy to decrease costs, maximize efficiency and increase sales to improve their bottom line.

There are many exciting career paths available for students who are interested in working with data warehouses or within the larger field of business intelligence (BI). BI professionals include data architects, database administrators, coders and analysts, among others.

BI professionals have a wide variety of educational backgrounds, but most employers look for a degree in information technology. Learn more about Herzing's IT programs here.

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