12/8/24, 21:45 Enterprise Data Warehouse (EDW) Full Guide

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Enterprise Data Warehouse: EDW

Components, Key Concepts, and
Architecture Types

15 min read Engineering, Cloud Last updated: 25 ago, 2022 1 Comment Share

Contents
What is an enterprise data warehouse?
Throughout the day we make many
Enterprise data warehouse concepts and functions
decisions relying on previous
Types of enterprise data warehouse
experience. Our brains store trillions
of bits of data about past events and Enterprise Data Warehouse Architecture
leverage those memories each time Data Warehouse vs Data Lake vs Data Mart
we face the need to make a decision.
Enterprise data warehousing technologies
Like people, companies generate and
collect tons of data about the past.
And this data can be used to make 1 Comment Share

better decisions.

While our brain serves to both process Stay tuned to the latest industry updates.
and store, companies need multiple
tools to work with data. And one of Enter your email
the most important ones is an
By clicking subscribe you confirm, that you understand and agree to
enterprise data warehouse or EDW. the Privacy Policy

In this article, we will discuss what an

enterprise data warehouse is, its types
and functions, and how it’s used in the
data processing. We will define how
enterprise warehouses are different

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from the usual ones, what types of

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data warehouses exist,Services
and how they Insights Company Careers
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work. The focus is to provide
information about the business value
of each architectural and conceptual
approach to building a warehouse.

What is an
enterprise data
warehouse?
An Enterprise Data Warehouse (EDW)
is a form of centralized corporate
repository that stores and manages all
the historical business data of an
enterprise. The information usually
comes from different systems like
ERPs, CRMs, physical recordings, and
other flat files. To prepare data for
further analysis, it must be placed in a
single storage facility. This way,
different business units can query it
and analyze information from multiple
angles. But for any data to become
actionable insights, it must go a long
way. You can learn more about how
data gets from sources to BI tools in
our video about data engineering.

With a data warehouse, an enterprise

can manage huge data sets, without
administering multiple databases.
Such practice is a futureproof way of
storing data for business intelligence
(BI), which is a set of
methods/technologies for
transforming raw data into actionable
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insights. With the EDW being an

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important part of it, theServices
system is Insights Company Careers
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similar to a human brain storing
information, but on steroids.

Enterprise data warehouse

components

There are a lot of instruments used to

set up an enterprise data warehousing
platform. Let’s have a bird’s eye view
of the purpose of each component
and its functions.

EDW components

Data sources. These are all the data

sources where raw data originates
and/or is stored. They can range from
simple spreadsheets to flat files to
relational SQL databases to IoT
systems, and more.

Ingestion layer. There are two main

approaches to pulling data out of
sources and delivering it to a
warehouse. Extract, transform, load
(ETL) and extract, load, transform (ELT)
tools connect to all the source data
and perform its extraction,
transformation, and loading into a
centralized storage system for easy
access and analysis. The distinction
between ETL and ELT approaches is
in the order of events. In ETL, the
transformation happens in a staging
area — before the data gets into an
EDW. A more modern approach, ELT
conducts all the transformation jobs
inside a warehouse. Here the staging
area is absent.

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Staging area (optional). In the case of

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ETL, the staging area is the place data
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is transformed before EDW. Here, it
will get cleansed, de-duplicated, split,
joined, and converted into a unified
format to fit a given data model of a
warehouse. The staging area may also
include tooling for data quality
management.

Storage layer. The data is finally

loaded into the storage space. With
the ELT approach, it might still take
some transformation here. But, at that
stage, all the general changes will be
applied, so the data will be loaded
into its final model(s). As we
mentioned, data warehouses are most
often relational databases. DW will
also include a database management
system and additional storage for
metadata.

Metadata module. Put simply,

metadata is data about data. These
are the explanations that give hints for
users/administrators of what
subject/domain this information
relates to. This data can be technical
meta (e.g., initial source), or business
meta (e.g., region of sales). All the
meta is stored in a separate module of
EDW and is managed by a metadata
manager. In some cases, there might
be an additional layer built on top of
the whole infrastructure to curate
metadata like a data virtualization
layer or a data fabric layer.

Data marts (optional). In some cases,

an EDW can have a set of smaller
subsections called data marts that are
built specifically for a particular
subject area, business function, or
group of users. For example, there
can be a separate data mart for
marketing purposes and a data mart
for a financial department.

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Presentation layer. The final building

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block of an EDW comprises tools that
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give end users access to data. Also
called the BI interface, this layer will
serve as a dashboard for data
visualization, business reporting, and
pulling out separate pieces of
information for such tasks as machine
learning.

Now let's figure out why such a

repository is called the enterprise data
warehouse, not just a data warehouse.

Enterprise data warehouse

vs usual data warehouse:
The key differences

By its fashion, any data warehouse is

a database that is always connected
with raw-data sources via data
integration tools on one end and
analytical interfaces on the other.
They provide storage capacities as
well as mechanisms to transform data,
move it, and present it to the end user.
If so, why do we isolate the enterprise
form for discussion?

The difference between a usual data

warehouse and an enterprise one is in
its much wider architectural diversity
and functionality. Because of the
complex structure and size, EDWs are
often decomposed into smaller
databases, so end users are more
comfortable querying these smaller
databases. Considering this, we’re
focusing on an enterprise warehouse
to cover the whole spectrum of
functionality.

However, the size of a warehouse isn’t

the only thing that defines its technical
complexity, the requirements for
analytical and reporting capabilities,
the number of data models, and the
data itself. So, to understand what
makes a warehouse what it is, let’s

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dive into its core concepts and

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Enterprise data
warehouse
concepts and
functions
With all the bells and whistles, at the
heart of every warehouse lay basic
concepts and functions. These pillars
define a warehouse as a technological
phenomenon.

Serves as the ultimate storage. An

enterprise data warehouse is a unified
repository for all corporate business
data ever occurring in the
organization.

Reflects the source data. EDW

sources data from its original storage
spaces like Google Analytics, CRMs,
IoT devices, etc. If the data is
scattered across multiple systems, it's
unmanageable. So, the purpose of
EDW is to provide the likeness of the
original source data in a single
repository. As there is always new,
relevant data generated both inside
and outside the company, the flow of
data requires a dedicated
infrastructure to manage it before it
enters a warehouse.

Stores structured data. The data

stored in an EDW is always
standardized and structured. This
makes it possible for the end users to
query it via BI interfaces and form
reports. And this is what makes a data
warehouse different from a data lake.
Data lakes are used to store
unstructured data for analytical
purposes. But unlike warehouses,
data lakes are used more by data
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engineers and data scientists to work

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with big sets of raw data.
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Subject-oriented data. The main focus
of a warehouse is business data that
can relate to different domains. To
understand what the data relates to,
it’s always structured around a specific
subject called a data model. An
example of a subject can be a sales
region or total sales of a given item.
Additionally, metadata is added to
explain in detail where every piece of
information comes from.

Time-dependent. The data collected

is usually historical data, because it
describes past events. To understand
when and for how long a certain
tendency took place, the prevailing
part of stored information is usually
divided into time periods.

Non-volatile. Once placed in a

warehouse, the data is never deleted
from it. The data can be manipulated,
modified, or updated due to source
changes, but it’s never meant to be
erased, at least by the end users. As
we speak about historical data,
deletions are counterproductive for
analytical purposes. Yet general
revisions may occur once in a few
years to get rid of irrelevant data.

With the base principles, we’ll look at

the implementation types of EDWs.

Types of enterprise
data warehouse
Considering EDW functions, there is
always some room for discussion on
how to design it technically. In the
case of data storage and processing,
they are specific and distinct to
different kinds of businesses.
Depending on the amount of data,
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analytical complexity, security issues,

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and budget, of course,Services
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an option on how to set up your
system.

On-premises data
warehouse

An on-premises data warehouse is

considered a classic variant for an
EDW that has its local dedicated
hardware and software capabilities for
unified data storage. When data is
stored on physical servers, you don’t
have to set up data integration tools
between multiple databases. Instead,
EDW can be connected with data
sources via APIs to constantly source
information and transform it in the
process. So, all the work is done
either in the staging area (the place
where data is transformed before
loading into the DW) or in the
warehouse itself.

A classic data warehouse is

considered superlative to a virtual one
(that we discuss below) because there
is no additional layer of abstraction. It
simplifies the work for data engineers
and makes it easier to manage data
flow on the preprocessing side, as
well as actual reporting.

The drawbacks of the classic

warehouse depend on the actual
implementation, but for most
businesses these are:

expensive technological
infrastructure (both hardware and
software) and
the necessity to hire a team of data
engineers and DevOps specialists
to set up and maintain the whole
data platform.

When to use: Such an EDW type is

appropriate for organizations of all
sizes that want to process their data
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securely and make the most out of it.

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Classic warehouses allow for
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morphing into different architectural
styles of the data platform and scaling
up and down on purpose while
maintaining data privacy concerns.

Virtual data warehouse

A virtual data warehouse is a type of

EDW used as an alternative to a
classic warehouse. Essentially, these
are multiple databases connected
virtually, so they can be queried as a
single system.

A scheme of relations between the

abstraction of virtual DW and source
databases

The data can stay in its sources: It isn’t

moved physically anywhere but can
still be pulled with the help of
analytical tools. Virtual warehouses
can be used if you don’t want to mess
with all the underlying infrastructure,
or the data you have is easily
manageable as it is. However, such an
approach has many drawbacks:

Multiple databases will require

constant software and hardware
maintenance and costs.
The data stored in a virtual DW still
requires transformation software to
make it digestible for the end users
and reporting tools.
Complex data queries may take too
much time, as the required pieces
of data may be placed in two
separate databases.
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When to use: Virtual EDWs are

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data in a standardized form that
doesn’t require complex analytics. It
also fits organizations that don’t use BI
systematically or want to start with it.

Cloud Data Warehouse

A cloud data warehouse is a central

repository for different information
hosted in the cloud. In this case, a
database is delivered as a managed
service by a cloud provider and is
optimized for analytics, scale, and
usability.

Cloud warehouses typically consist of

compute, storage, and client (service)
layers. In the compute layer, there are
multiple compute clusters with nodes
processing queries in parallel. The
storage layer, as the name suggests,
keeps all types of information. The
client layer is responsible for data
management activities.

In this case, cloud warehouse

architecture has the same benefits as
any other cloud service. Its
infrastructure is typically maintained
for you, meaning you don’t need to
set up your own servers, databases,
and tooling to manage it. The price for
such a service will depend on the
amount of memory and computing
capabilities required for querying.

The only aspect you might be

concerned about in terms of a cloud
warehouse platform is data security.
Your business data is a sensitive thing.
So, you want to check if the vendor
you have chosen can be trusted to
avoid breaches. This doesn’t
necessarily mean that an on-premise
warehouse is more secure, but in this
case, the safety of your data is in your
hands.

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When to use: Cloud data warehouse

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platforms are a great choice
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organizations of any size. If you need
everything set up for you, including
managed data integration, DW
maintenance, and BI support.

Enterprise Data
Warehouse
Architecture
While there are many architectural
approaches that extend warehouse
capabilities in one way or another, we
will focus on the most essential ones.
Without diving into too much technical
detail, the whole data pipeline can be
divided into three layers:

Raw data layer (data sources)

Warehouse and its ecosystem
User interface (analytical tools)

The tooling that concerns data

Extraction, Transformation, and
Loading into a warehouse is a
separate category of tools known as
ETL. Also, under the ETL umbrella,
data integration tools perform
manipulations with data before it’s
placed in a warehouse. These tools
operate between a raw data layer and
a warehouse.

When the data is loaded into a

warehouse, it can also be
transformed. So, the warehouse will
require certain functionality for
cleaning/standardization/dimensionali
zation. These and other factors will
determine architecture complexity. We
will look at the EDW architecture from
the standpoint of growing
organizational needs.

One-tier architecture
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Given that data integration is well-

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configured, we can choose our data
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warehouse. In most cases, a data
warehouse is a relational database
with modules to allow
multidimensional data or one that can
separate some domain-specific
information for easier access. In its
most primitive form, warehousing can
have just one-tier architecture.

The reporting layer is connected

directly with the whole database of
EDW

One-tier architecture for EDW means

that you have a database directly
connected with the analytical
interfaces where the end user can
make queries. Setting the direct
connection between an EDW and
analytical tools brings several
challenges:

Traditionally, you can consider your

storage a warehouse starting from
100GB of data. Working with it
directly may result in messy query
results, as well as low processing
speed.
Querying data right from the DW
may require precise input so that
the system will be able to filter out
non-required data. Which makes
dealing with presentation tools a
little difficult.
Limited flexibility/analytical
capabilities exist.

Additionally, the one-tier architecture

sets some limits to reporting
complexity. Such an approach is rarely
used for large-scale data platforms,

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because of its slowness and

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unpredictability. To perform advanced
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data queries, a warehouse can be
extended with low-level instances that
make access to data easier.

Two-tier architecture (data

mart layer)

In two-tier architecture, a data mart

level is added between the user
interface and EDW. A data mart is a
low-level repository that contains
domain-specific information. Simply
put, it's another, smaller-sized
database that extends EDW with
dedicated information for your
sales/operational departments,
marketing, etc.

In two-tier architecture, an EDW is

extended by data marts to provide
domain-specific data

Creating a data mart layer will require

additional resources to establish
hardware and integrate those
databases with the rest of the data
platform. But, such an approach
solves the problem with querying:
Each department will access required
data more easily because a given mart
will contain only domain-specific
information. In addition, data marts will
limit the access to data for end users,
making EDW more secure.

Three-tier architecture
(Online analytical processing)

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On top of the data mart layer,

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enterprises also use online analytical
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processing (OLAP) cubes. An OLAP
cube is a specific type of database
that represents data from multiple
dimensions. While relational
databases represent data in just two
dimensions (think of Excel or Google
Sheets), OLAP allows you to compile
data in multiple dimensions and move
between dimensions.

OLAP cubes layer may source

information from distributed marts or
directly from EDW

It’s pretty difficult to explain in words,

so let’s look at this handy example of
what a cube can look like.

OLAP cube demonstrating

multidimensional sales data

Source: oreilly.com

So, as you can see, a cube adds

dimensions to the data. You may think
of it as multiple Excel tables combined
with each other. The front of the cube
is the usual two-dimensional table,
where the region (Africa, Asia, etc.) is
specified vertically, while sales
numbers and dates are written
horizontally. The magic begins when

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we look at the upper facet of the

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routes and the bottom specifies time-
period. That’s known as
multidimensional data.

The business value of OLAP is that it

allows users to slice and dice the data
to compile detailed reports. As long as
the cubes are optimized to work with
warehouses, they can be used both
directly with an EDW to give access to
all the corporate data or with each
data mart specifically. In terms of
implementation, nearly all warehouse
providers offer OLAP as a service. As
an example, check Microsoft
documentation on their OLAP offer.

On that point, we have discussed a

high-level design of an EDW applied
to organizational needs. Now we’re
going to drill down into technical
components that a warehouse may
include.

Data vault architecture is a method of

building a data warehouse. Our
dedicated article covers this approach
in detail; read it to learn more.

Data Warehouse vs
Data Lake vs Data
Mart
Speaking about data storage
architecture, we have to mention such
options as using a data mart or a data
lake instead of a warehouse.
Frequently conflated, we’ll elaborate
on the definitions.

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Comparison table of data warehouses

vs data lakes vs data marts

Data warehouses, in their traditional

form, are meant to store structured
data presented fitting nicely in
columns and rows so that it’s easier
for querying tools and end users can
get comprehensive results.
Warehouses, mostly used for BI,
usually vary in size between 100GB
and infinity. They get data from a big
number of external and internal
sources, covering different business
areas. Speaking of on-premises data
warehouses, it may take months to
complete their configuration.

Data lakes, on the other hand, are

used to store massive amounts of
different information including
structured, unstructured, and semi-
structured data in their raw formats.
Lakes are often leveraged for machine
learning, big data processing, or data
mining purposes. For the last couple
of years, data lakes have been used
for BI: Raw data is loaded into a lake
and transformed, which is an
alternative to the ETL process. While
this approach has its pros and cons,
data lakes can be too messy for
reaching structured data. By the way,
there’s also a new, hybrid variant
called a data lakehouse.

There may also be some confusion

with the whole data warehouse vs

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data mart thing.

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The comparison of three data storage

forms

Data marts are subject-oriented

relational databases that contain only
a subset of DW data that is specific to
a particular business department of an
enterprise, e.g., a financial
department. They can also be used as
an alternative to DW. But, because of
their small size (usually less than
100GB), data marts can hardly be used
by enterprises. More often, data marts
are used to segment a large DW into
more operable segments. Data marts
get information from relatively few
sources, typically contain structured
data, and take less time for setup —
normally 3 to 6 months for on-premise
solutions.

Enterprise data
warehousing
technologies
Understanding what enterprise data
warehouse tools exist can help you
figure out what actually fits your data
platform requirements. Planning to set
up a warehouse may take years of
planning and testing, because of the
scale of it in a most basic form.

As a business owner, you might be

confused by the number of options
and technologies used, so it’s vital to
consult with experts in the field of

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warehousing, ETL, and BI. While

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experts can help you with the
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technical aspect, to define the
business purpose, speak with the
ones who will use the actual data in
their work.

In recent times, cloud/cloudless

technologies have become more of a
standard for setting up organization-
level technologies. You’ll find
countless providers on the market that
offer data warehousing-as-a-service,
meaning you will use the computation
power and space presented by cloud
providers. And in most cases, such
providers offer fully-managed,
scalable warehousing as a part of their
BI tooling.

Here are a few most popular cloud

data warehouse products.

Amazon Redshift is a cloud-based

enterprise data warehouse that is a
part of Amazon’s cloud-computing
platform. It allows for concurrent
processing of large amounts of data
depending on the demands of the
company. While being a public cloud
provider, Redshift is more self-
managed, meaning you will need data
engineers to perform resource and
server management. As far as the
pricing, you can start at $0.25 per
hour and scale up to petabytes of data
and thousands of concurrent users.

Google BigQuery is a multi-cloud data

warehouse that provides capabilities
for querying a large amount of data
simultaneously by different users. It is
a serverless technology, meaning all
the management is taken care of for
you, and it has separated compute
and storage layers. BigQuery is highly
performant and scalable. As far as the
pricing, you can go either with flat-rate
or on-demand subscriptions.

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Snowflake is a more serverless cloud

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data warehouse built on top of the
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AWS technologies. Since it’s provided
as a SaaS solution, you don’t have to
configure any virtual or physical
hardware as these tasks are taken
care of by a provSnowflake has
gained popularity for providing
flexible, fast, and easy-to-use data
storage and analytic solutions. As a
user, you just choose the number and
the size of compute clusters. The
pricing page will guide you to the
provider’s offerings.

More information about cloud data

warehouses, their performance,
integration capabilities, etc., you can
find in our dedicated article comparing
the key players on the cloud
enterprise data warehousing market.

Comments 1 Sort by newest

Nice post! Loved the insight.

Nigel from Sqlops.com
Nigel M 3 Apr, 2024 Reply

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