Using a data warehouse

All data warehouses store their data grouped together by subject areas that reflect the general usage of the data (Customer, Product, Finance etc.). The general principle used in the majority of data warehouses is that data is stored at its most elemental level for use in reporting and information analysis.

Within this generic intent, there are two primary approaches to organising the data in a data warehouse.

The first is using a "dimensional" approach. In this style, information is stored as "facts" which are numeric or text data that capture specific data about a single transaction or event, and "dimensions" which contain reference information that allows each transaction or event to be classified in various ways. As an example, a sales transaction would be broken up into facts such as the number of products ordered, and the price paid, and dimensions such as date, customer, product, geographical location and salesperson.

The main advantage of a dimensional approach is that the Data Warehouse is easy for business staff with limited information technology experience to understand and use. Also, because the data is pre-processed into the dimensional form, the Data Warehouse tends to operate very quickly. The main disadvantage of the dimensional approach is that it is quite difficult to add or change later if the company changes the way in which it does business.

The second approach uses database normalization. In this style, the data in the data warehouse is stored in third normal form. The main advantage of this approach is that it is quite straightforward to add new information into the database -- the primary disadvantage of this approach is that it can be rather slow to produce information and reports.