Data Warehouses

In this week’s module, I found the information on data warehouses to be the most clear to me.  A data warehouse is essentially a warehouse that stores a HUGE amount of data. A data warehouse basically copies information regularly from transactional data into the warehouse.  In other words, it takes live data from operations and stores it. Sometimes when live processing of data takes place, a customer might have to wait for a response on a particular website and therefore, might choose to visit a buy from another site.  Data warehousing is useful because it allow analysis of the data to take place in the warehouse opposed to live online processing of data.  This gives the customer instantaneous data analysis allowing the customer to have a pleasant shopping experience.

Data warehouses can most definitely be useful in the business environment for several reasons.  One reason, as previously mentioned, is it stores a massive amount of data.  This is beneficial in the business world because it allows the business to analyze data from many different areas and manipulate it however they would like.  Another reason this could be useful is for the fact that it analyzes the data in the warehouse.  On a live online center, they are not able to analyze data like they would be able to in a warehouse. A data warehouse is also useful because it has the potential to make the customer’s shopping experience more enjoyable.

This simple picture illustration helps explain the concept of a data warehouse.  All these different elements of information are combined into one data warehouse.  The website above also helps explain the concept of a data warehouse a little bit more.  The website explains data warehouses to be an important tactic for any business.

Corporate Gymnastics: Balancing Data System Opportunities and Challenges for IT Firms

It is no surprise that with every opportunity comes challenge.  For most firms, opportunities for growth are balanced by challenges, obstacles that can inhibit success.  Information technology (IT) firms often face this dilemma when dealing with data systems.  Data mastery yields competitive advantage for IT firms; therefore, demand for data systems and proper database management continues to increase.  This increased demand for data mastery puts IT firms in a tight position, especially when considering costs to acquire and maintain data systems.

Data systems can provide corporations with the ability to store and track consumer information.  Transaction processing systems (TPS) specifically trace business exchanges so that firms can obtain digital profiles of consumers.  TPS monitors standard business transactions that occur frequently and encodes transaction information in databases.  These systems help firms understand customers and market products that meet customer needs and interests based on the information they provide.  Other forms of data systems include enterprise software such as customer relationship management and supply chain management systems. Particularly, these two systems are used by firms to keep tabs on their interactions with customers, manufacturers, and distributors.  It also looks at customer’s sales and shopping habits. This data helps corporations operate more effectively and efficiently as they are able to understand the needs and wants of their customers and business partners.

As enterprise software systems become more integrated and the value of data systems increases, problems also arise.  Privacy concerns reign among the issues proceeding data system development.  Consumers and firms alike fear data breaching, or the accidental revealing of private information. With a single system glitch or hack, data can be made publicly accessible, even for criminals.  Consumers can be faced with identity theft from improper database management.  Firms could incur loss of sales and customer loyalty, lawsuits, more government legislation on database systems, and negative brand image.  Monetary costs are also an issue for IT firms.  Data systems continue to become increasingly expensive to obtain and maintain as more firms rely on them for support.

Finding a balance between the demand for data systems and the costs of acquiring and maintaining them can be troublesome for many corporations.  Data mastery provides a shear competitive advantage but firms should be weary of both monetary costs and privacy concerns that come with this opportunity for growth.  Being able to walk on a corporate balance beam between the two will enable firms to use these systems to their advantage.