Aubrey Van Aswegen, MD of Knowledge Integration Dynamics, examines the emergence of industry-specific applications in the data warehouse market and the measurable impact these have on business.
Far from the heady start-up days of the data warehousing concept where the data warehouse was promoted as the ultimate solution for every organisations` problems, the past four years has witnessed the industry move into a scenario of focussing on market niches.
Tired of the excessive, spiralling costs and lengthy design and implementation times data warehouses demanded before any form of measurable results could be gained, if any were delivered, executive teams cut IT`s purse strings when it came to data warehouses and demanded changes that would deliver faster results at less cost. Hence warehouse design teams have moved from trying to create the solution to solve every business problem, to focusing in on niches; to honing in on subject areas; to solving specific, definable, measurable business problems.
The benefits this new focussed data warehousing trend offers both management and implementers a shortened design process that delivers tangible, demonstrable, and most importantly, measurable results in the shortest possible time.
Examples of this are to be found in retail, health and insurance sectors, to mention just three vertical application areas. Application areas include customer profiling for customer retention programmes, risk analysis, shopping basket analysis, fraud detection and churn analysis, or the reduction of customer loss. Churn analysis is particularly important in the cellular technology arena, where 0,1% reduction of churn can translate to millions of rand in increased revenue.
Whereas the old data warehouse sales team would sell the technology to enable the potential warehousing solution, the focussed approach uses technology as a vehicle of delivery, with the underlying technological structure purely academic. Business wants an out-of-the-box, black-box warehouse solution that delivers results in three steps: plug in, populate and go.
Customer gains from these new data warehousing solutions include the benefit that the technology is hidden from view, where the internals or underpinning technologies are of no interest to management. All they know is that they`re getting an easy-to-use data warehouse application that plugs into existing data sources, transforms the data into information and is presented to businesspeople in a way that is easily understandable. And it is delivered in days or weeks rather than months or years.
As with any maturing business process, the market is moving towards targeted analytical applications because of the reduced delivery cycle and the ease and accuracy with which costs can be pegged. The generic data warehouse approach did not allow for upfront costs prediction and focus on targeted deliverables.
Under the hood of the data warehousing application are all the traditional disciplines associated with data warehousing: cleansing of data, maintenance of referential integrity, provision of application-specific source data for the data warehouse, aggregation of data, and definitions of the most common queries for ease of use. But the business is not concerned with these issues; all it sees is a functional data warehouse that is delivering benefit. And, as that is what business has sought from data warehousing all along.
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