Chapter 7:Accessing Organizational

Information n—Data Warehouses

 1. Describe the roles and
purposes of data
warehouses and data marts
in an organization
Chapter 7:
2. Identify the advantages of
using business intelligence
to support managerial
decision making
DATA WAREHOUSE

• Data warehouse stores information from many different

internal databases collected from its website, mobile app,
and other external information such as Industry reports,
market trends, and economic data, market research reports
for business analysis and decision-making.
• The primary purpose of a data warehouse is to aggregate
information throughout an organization into a single
repository for decision-making purposes.
• The data warehouse provided the ability to support decision
making without disrupting the day-to-day operations.
DATA WAREHOUSE
Data Warehousing

• When your managers need to make decisions about best selling

products during the holiday season. which products to stock in
stores or which one not to purchase, how to price items, they
access historical sales figures, customer preferences and rely
on data and reports from this warehouse.
Data Warehousing

• When your managers need to make decisions about best selling

products during the holiday season. which products to stock in
stores or which one not to purchase, how to price items, they
access historical sales figures, customer preferences and rely on
data and reports from this warehouse.
• Data warehouse stores information from multiple internal databases i.e.
• Customer Information in A Customer Relationship Management (CRM)
System
• Storing Financial Transactions In An Accounting System
• Storing Inventory And Orders In An E-commerce System
• Storing patient records in a healthcare system
HISTORY OF THE DATA WAREHOUSE

• Data warehouses support only online analytical

processing (OLAP)
• OLAP is software for performing multidimensional
analysis at high speeds on large volumes of data from a
data warehouse, data mart, or some other unified,
centralized data store.
• OLAP does dicing, Slicing, Pivoting and Drilling.
OLAP

• Slicing: OLAP allows you to "slice" the data by region, income, age,
gender etc. You can see that Double Cheeseburger is top seller in
Manama.
• Dicing: For deeper analysis, you can dice the data by both region and
time, so you can see if the Double Cheeseburger is more popular
during the Summer in the Manama.
• Drilling: For more deeper analysis, OLAP lets you "drill" into the data
to see the sales performance of different states, discovering that New
York and Florida are top performing cities. Now you can do the
analysis to identify top performing stores in New York. Then you can
see which products are driving sales in the high-performing stores
OLAP
Pivoting: Enables comparative analysis from a different
organizational perspective
 SHOW EXCEL FOR PIVOTING,
SLICING and DICING

Class Practice
DATA WAREHOUSING
 DATA WAREHOUSING

• INCONSISTENT DATA
• Different departments use their own terms and abbreviations to
describe product categories. For example:
• The marketing department uses "Mobile Phones."
• The sales team uses "Cell Phones."
• The inventory team uses "Smartphones."
• This inconsistency in product categories makes it challenging to analyze
data accurately.
• Establishing a standard term like "Mobile Phones" across all
departments is very important for accurate data analysis.
 DATA WAREHOUSING

• LACK OF DATA STANDARDS:

• Consider a healthcare system where different hospitals use various formats for patients'
records. For instance:
• Hospital A records the date of birth as "dd/mm/yyyy."
• Hospital B uses "mm/dd/yyyy."
• Hospital C prefers "yyyy-mm-dd.“
• If Govt wants to check the number of Malaria patients got admitted in Hospitals on 17
Oct 2023, how to get the accurate information in this case?
• When these records are shared or merged, it becomes complex to make sense of the
data.
• Without consistent data standards, there's a risk of errors, misinterpretations, and
inefficiencies.
• Implementing a standard date format across the entire healthcare system would help
overcome this issue.
 DATA WAREHOUSING

• Poor Data Quality:

• On website, some sellers provide incomplete or inaccurate product
descriptions. For example:
• They omit essential details like product dimensions, which can lead to
customer dissatisfaction.
• Exaggerating the product's condition, describing used items as "brand new."
• Uploading blurry or irrelevant images that don't represent the product.
• These issues result in poor data quality.
• Customers might receive products that don't match their expectations,
leading to returns and negative reviews.
 Show the Excel worksheet to
explain these concepts

Class Practice
DATA WAREHOUSING
 DATA WAREHOUSING

• Inadequate Data Usefulness:

• Imagine your website collects a vast amount of customer data, including
their browsing history, purchase history, and demographic information
(age, gender, nationality, income) .
• However, this data is not effectively used to enhance the customer
experience.
• For example, a customer frequently purchases books related to a specific
topic, but your system doesn't use this information to recommend similar
books or offer discounts.
• Inadequate data usefulness means that you're not utilising the available
data to provide personalized and relevant services to your customers.
 DATA WAREHOUSING

• Ineffective Direct Data Access:

• Suppose sales managers or marketing analysts, cannot directly access the data
they need. Instead, they have to submit requests to the IT department and wait for
MIS professionals to code SQL queries to retrieve the required information.
• Time Delays: The process of submitting requests, waiting for coding, and receiving
the results introduces significant delays. Users may have time-sensitive decisions
to make, and waiting for IT could limit their ability to respond quickly to market
changes or customer demands.
• Reduced Productivity: The inefficiency in direct data access reduces the overall
productivity of various departments.
• Risk of Miscommunication: There may be misunderstandings between users and
the IT department, leading to inaccurate or incomplete data retrieval.
 A Data Mart is a subset of a Data
Warehouse, focusing on specific
business areas i.e. marketing, HR,
DATA Accounting or other topics,
MARTS designed to support the needs of a
particular group or department
within an organization.
 DATA MARTS

• Data Mart – Contains a subset of data warehouse

information
• Extraction, transformation, and loading (ETL) – A process
that extracts information from internal and external
databases, transforms the information using a common set
of enterprise definitions, and loads the information into a
data warehouse
DATA MARTS
 DATA MARTS

• Data Mart Example:

• The finance data mart aggregates data related to financial transactions
to make income statements, balance sheets, and cash flow statements.
• The marketing data mart contains customer data, including
demographics (age, income, gender, region), preferences, and
purchase history to use this information to tailor messages and
promotions to different audience segments.
• Data related to marketing campaigns, including performance metrics,
response rates, and conversion rates, is stored in the data mart to
analyze the effectiveness of campaigns.
 DISTINGUISH BETWEEN DATA WAREHOUSE
& DATA MARTS

• Data Mart:
• The Sales Data Mart contains information on sales
transactions, customer orders, and salesperson
performance to track sales targets and individual
performance.
• The Inventory Data Mart focuses on stock levels, product
movement, and supply chain data. This Data Mart is
essential for inventory management and ensuring
products are available when customers need them.
 DATA MARTS

• Extraction, transformation, and loading (ETL)

• The ETL process gathers data from the internal and external
databases and passes it to the data warehouse
• The ETL process also gathers data from the data warehouse and
passes it to the data marts.
 DATA MARTS

• Extraction, transformation, and loading (ETL)

• IKEA has many stores worldwide.
• Each IKEA store in different countries has its own databases to track sales,
inventory, and customer information.
• External data sources like economic, Industry reports, market trends, and
economic data, market research reports are also available.
• IKEA wants to create a centralized data repository, a Data Warehouse, to analyze
global sales trends, inventory management, and enhance customer insights.
• IKEA wants to make data marts also for KSA, Bahrain, Sweden or data marts for
different departments in KSA.
• To accomplish this, IKEA needs to implement an ETL process.
 DATA MARTS

• Extraction:
• Data is extracted from the various sources.
• For example, data is extracted from every cash
register in every store, gathering information on
sales, products, and customers.
• Data is extracted from external market research
reports.
 DATA MARTS

• Transformation:
• The extracted data often in different formats and may use different
coding conventions.
• In the transformation phase, data is cleaned, standardized, and
organized into a common format.
• Business rules are applied to aggregate data, handle missing values,
and convert currencies or units of measurement if necessary.
• For instance, if one store records sales in US dollars and another in
euros, the transformation process will convert all sales figures into a
single currency (e.g., US dollars).
 DATA MARTS

• Loading:
• Transformed data is then loaded into the central Data Warehouse.
• In the Data Warehouse, data is organized and stored in a way that facilitates
complex queries and reporting.
• You can now perform analyses like tracking the global popularity of a specific
product, identifying regions with high customer traffic, and optimizing
inventory levels across different stores.
• Additionally, data from the Data Warehouse can also be used to populate
Data Marts tailored to the specific needs of different departments.
• For instance, the marketing department might have its own Data Mart
focused on customer behavior data.
DATA MARTS
What is the difference between
Data Mart and Data Warehouse
 DDISTINGUISH BETWEEN DATA
WAREHOUSE & DATA MARTS

• Key differences between data warehouse & data marts :

• Size and Scope: A Data Warehouse is extensive and encompasses
data from the entire organization. Data Marts are smaller and focus
on specific departments or business units.
• Audience: Data Warehouses are used for enterprise-wide analysis.
Data Marts serve particular departments or teams.
• Comprehensiveness: Data Warehouses store a broad range of data.
Data Marts contain a subset of data relevant to a specific area.
 DDISTINGUISH BETWEEN INTERNAL
DATABASE & DATA MARTS

• Internal Database
• ERP system integrates data from various departments, including finance,
production, supply chain, and human resources.
• The database contains tables for financial transactions, inventory levels,
employee records, customer orders, and more.
• Data Mart
• Sales data mart extracts and stores relevant data from the internal database,
focusing on sales-related metrics such as customer purchases, sales trends,
and market performance.
• The sales team can then run targeted queries on sales data mart to gain
insights into customer behavior, product performance, and sales
effectiveness.
 A process that or discards
Information inconsistent, incorrect, or
cleansing or incomplete in weeds out
scrubbing and fixes formation and
making sure it's free from
inconsistencies, errors, and
missing pieces.
 INFORMATION CLEANSING OR SCRUBBING

Contact
Information in an
Operational
System
 INFORMATION CLEANSING OR SCRUBBING

• Once you collect a massive amount of data about

customers, orders, and products, over time, this data
can become messy, containing errors and
inconsistencies.
 INFORMATION CLEANSING OR SCRUBBING

• INFORMATION CLEANSING PROCESS:

• Inconsistencies: Customer database may have entries where the same
customer's name is spelled differently i.e.John Smith" vs. "Jon Smith.
• Errors: Some customers may have incorrect email addresses or old phone
numbers, making the communication difficult.
• Incomplete/missing Information: Product listings might be missing products
or essential details like prices, descriptions, or images.
• Inaccuracies: Order records may contain errors in quantities, prices, or
delivery addresses.
• Data Deduplication: There might be duplicate customer entries which is
needed to identify to delete those entries.
• Standardization: All customer names are standardized to follow a consistent
format.
INFORMATION CLEANSING OR SCRUBBING

Standardizing Customer Name

from Operational Systems
Taking a look at customer
information highlights why
information cleansing and
scrubbing is necessary?
• Changing Information: Customers
update their contact information, such
as phone numbers or email addresses,
over time. This means the data can
change frequently.
• If the data is not cleansed and
scrubbed, customers might receive
promotions at outdated addresses or
phone numbers. This could result in
missed opportunities, increased costs,
and customer frustration.
 • What would happen if the
information in the data
warehouse was only about 70
percent accurate?
• Would you use this information to
make business decisions?
• Is it realistic to assume that an
organization could get to a 100%
INFORMATION accuracy level on information
CLEANSING OR contained in its data warehouse?
SCRUBBING
 INFORMATION CLEANSING
OR SCRUBBING

Contact Information in an Operational System

INFORMATION CLEANSING
OR SCRUBBING

Information
Cleansing
Example
 INFORMATION CLEANSING
OR SCRUBBING

• Erroneous Relationships or References:

• Example: In a relational database, if a product is incorrectly associated
with the wrong category, it might appear in the wrong section of an e-
commerce website.
• Consequences: Customer confusion, potential loss of sales, and damage to
the business's reputation.
 INFORMATION CLEANSING
OR SCRUBBING
• Erroneous Relationships or References:
Product
Laptop
• In an e-commerce scenario, data entry errors or system glitches, a "Laptop" could be mistakenly
Phone associated with the "Smartphones" category instead of its correct "Electronics" category.
Projectors • This error can result in the website displaying the laptop in the wrong section, potentially under
Desktop PC "Smartphones" instead of "Electronics" category.
Heater
Split AC • Consequences of Erroneous Relationships:
Rice cooker • Misplaced Products on the Website:
• This misplacement can confuse customers who are browsing for laptops in the electronics section and
don’t find laptops in that category.
Product Category • Inaccurate Product Recommendations:
Electronics • If the website uses recommendation algorithms based on product categories, then customers who
Home Appliances view the "Smartphones" category might receive recommendations for laptops, which is wrong
recommendation for that specific customer.
Office equipments
• Data Analysis and Reporting Issues:
Smartphones
• Decision-makers relying on this information might make misguided business decisions, thinking that
smartphones are performing better than laptops in the sales reports as laptops are under
Smartphone category.
Accurate information
versus Complete
Information
 Accurate information
versus Complete Information

• If businesses had to choose an acceptable percentage for information

accuracy, it would likely be well below 100%.
• This acceptable percentage for information accuracy depends on the
specific industry, type of data, and business objectives.
• In healthcare, patient records might need to approach 100% accuracy
to ensure patient safety, while in marketing, a lower accuracy level
might be acceptable for targeting potential customers.
• The information is useless if it is not accurate.
• Accurate information means it is correct, while complete
information means there are no blanks/missing information.
Accurate information
versus Complete Information

Cost of Accurate and Complete Information

 Accurate information
versus Complete Information

• Why do you think most businesses cannot achieve 100%

accurate and complete information?
• Most businesses cannot achieve 100% accurate and complete information for several reasons:
• Data Volume: Businesses deal with vast amounts of data daily, making it challenging to
maintain accuracy and completeness across all records.
• Data Sources: Data often comes from various sources, and integrating and validating this data
can be complex. Each source may have its data format and quality.
• Human Error: Data entry, manipulation, and interpretation involve human interaction, which
is prone to errors. Typos, misinterpretations, and other mistakes can occur.
• Changing Information: Data is dynamic, and it changes over time. Keeping it updated and
accurate is an ongoing challenge.
• Resource Constraints: Achieving 100% accuracy and completeness requires substantial
resources in terms of time, money, and technology. Many businesses have constraints in these
areas.
Business Intelligence
 BUSINESS INTELLIGENCE

• Organizational data contains structured data, for

example in HR the data about Employee ID, Name,
Position, Department, Joining Date, Salary, Contact
Details
• Organizational data contains unstructured data such
as voice mail, phone calls, text messages, and video
clips
 THE PROBLEM: DATA RICH, INFORMATION
POOR

• Businesses face a data explosion as digital images, email in-boxes, and

broadband connections doubles yearly
• The amount of data generated is doubling every year
• Some believe it will soon double monthly.
• As businesses increase their reliance on enterprise systems such as CRM,
they are rapidly accumulating vast amounts of data.
• Every interaction between departments or with the outside world,
historical information on past transactions, as well as external market
information, is entered into information systems for future use and access.
 THE SOLUTION: BUSINESS INTELLIGENCE

• Improving the quality of business decisions has a direct impact on

costs and revenue
• BI enables business users to receive data for analysis that is:
1. Reliable
2. Consistent
3. Understandable
4. Easily manipulated
 THE SOLUTION: BUSINESS INTELLIGENCE

• Business Intelligence (BI) and Data Quality:

• Business Intelligence systems play a crucial role in providing reliable,
consistent, understandable, and easily manipulable data for analysis.
Let's consider an example to understand how BI achieves this:
• Example - Retail Sales Analysis:
• Imagine a retail chain with multiple stores across the country. They
use a BI system to analyze their sales data.
THE SOLUTION: BUSINESS INTELLIGENCE

BI Can Answer Tough Questions

 THE SOLUTION: BUSINESS INTELLIGENCE

• The figure displays how organizations using BI can find the root causes to problems and provide
solutions simply by asking “Why?” The process is initiated by analyzing a global report, say of sales
per quarter.
• Every answer is followed by a new question, and users can drill deep down into a report to get to
fundamental causes.
• Once they have a clear understanding of root causes, they can take highly effective action.
• Finding the answers to tough business questions by using data that is reliable, consistent,
understandable, and easily manipulated allows a business to gain valuable insight into such things as:
• Where the business has been. Historical perspective is always important in determining trends and
patterns of behavior.
• Where it is now. Current situations are critical to either modify if not acceptable or encourage if they
are trending in the right direction.
• And where it will be in the near future. Being able to predict with surety the direction of the
company is critical to sound planning and to creating sound business strategies.
End of Chapter