What is business intelligence?
A business analyst often wants to get a big picture of the business, to see broader trends
based on aggregated data, and to see these trends broken down by any number of
variables. Business intelligence is the process of extracting data from an OLAP database
and then analyzing that data for information that you can use to make informed business
decisions and take action. For example, OLAP and business intelligence help answer the
following types of questions about business data:
How do the total sales of all products for 2007 compare with the total sales from
2006?
How does our profitability to date compare with the same time period during the
past five years?
How much money did customers over the age of 35 spend last year, and how has
that behavior changed over time?
How many products were sold in two specific country/regions this month as
opposed to the same month last year?
For each customer age group, what is the breakdown of profitability (both margin
percentage and total) by product category?
Find top and bottom salespeople, distributors, vendors, clients, partners, or
customers.
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What is Online Analytical Processing (OLAP)?
Online Analytical Processing (OLAP) databases facilitate business-intelligence queries.
OLAP is a database technology that has been optimized for querying and reporting,
instead of processing transactions. The source data for OLAP is Online Transactional
Processing (OLTP) databases that are commonly stored in data warehouses. OLAP data is
derived from this historical data, and aggregated into structures that permit sophisticated
analysis. OLAP data is also organized hierarchically and stored in cubes instead of tables.
It is a sophisticated technology that uses multidimensional structures to provide rapid
access to data for analysis. This organization makes it easy for a PivotTable report or
PivotChart report to display high-level summaries, such as sales totals across an entire
country or region, and also display the details for sites where sales are particularly strong
or weak.
OLAP databases are designed to speed up the retrieval of data. Because the OLAP server,
rather than Microsoft Office Excel, computes the summarized values, less data needs to
be sent to Excel when you create or change a report. This approach enables you to work
with much larger amounts of source data than you could if the data were organized in a
traditional database, where Excel retrieves all of the individual records and then
calculates the summarized values.
OLAP databases contain two basic types of data: measures, which are numeric data, the
quantities and averages that you use to make informed business decisions, and
dimensions, which are the categories that you use to organize these measures. OLAP
databases help organize data by many levels of detail, using the same categories that you
are familiar with to analyze the data.
The following sections describe each of these components in more detail:
Cube A data structure that aggregates the measures by the levels and hierarchies of
each of the dimensions that you want to analyze. Cubes combine several dimensions,
such as time, geography, and product lines, with summarized data, such as sales or
inventory figures. Cubes are not "cubes" in the strictly mathematical sense because they
do not necessarily have equal sides. However, they are an apt metaphor for a complex
concept.
Measure A set of values in a cube that are based on a column in the cube's fact table
and that are usually numeric values. Measures are the central values in the cube that are
preprocessed, aggregated, and analyzed. Common examples include sales, profits,
revenues, and costs.
Member An item in a hierarchy representing one or more occurrences of data. A
member can be either unique or nonunique. For example, 2007 and 2008 represent
unique members in the year level of a time dimension, whereas January represents
nonunique members in the month level because there can be more than one January in the
time dimension if it contains data for more than one year.
Calculated member A member of a dimension whose value is calculated at run time
by using an expression. Calculated member values may be derived from other members'
values. For example, a calculated member, Profit, can be determined by subtracting the
value of the member, Costs, from the value of the member, Sales.
Dimension A set of one or more organized hierarchies of levels in a cube that a user
understands and uses as the base for data analysis. For example, a geography dimension
might include levels for Country/Region, State/Province, and City. Or, a time dimension
might include a hierarchy with levels for year, quarter, month, and day. In a PivotTable
report or PivotChart report, each hierarchy becomes a set of fields that you can expand
and collapse to reveal lower or higher levels.
Hierarchy A logical tree structure that organizes the members of a dimension such that
each member has one parent member and zero or more child members. A child is a
member in the next lower level in a hierarchy that is directly related to the current
member. For example, in a Time hierarchy containing the levels Quarter, Month, and
Day, January is a child of Qtr1. A parent is a member in the next higher level in a
hierarchy that is directly related to the current member. The parent value is usually a
consolidation of the values of all of its children. For example, in a Time hierarchy that
contains the levels Quarter, Month, and Day, Qtr1 is the parent of January.
Level Within a hierarchy, data can be organized into lower and higher levels of detail,
such as Year, Quarter, Month, and Day levels in a Time hierarchy.
OLAP
Stands for "Online Analytical Processing." OLAP allows users to analyze database
information from multiple database systems at one time. While relational databases are
considered to be two-dimensional, OLAP data is multidimensional, meaning the
information can be compared in many different ways. For example, a company might
compare their computer sales in June with sales in July, then compare those results with
the sales from another location, which might be stored in a different database.
In order to process database information using OLAP, an OLAP server is required to
organize and compare the information. Clients can analyze different sets of data using
functions built into the OLAP server. Some popular OLAP server software programs
include Oracle Express Server and Hyperion Solutions Essbase. Because of its powerful
data analysis capabilities, OLAP processing is often used for data mining, which aims to
discover new relationships between different sets of data.
