Friday, January 20, 2006

A data warehouse is not just for Christmas

A brief article by Bill Inmon addresses a key point often overlooked - when is a data warehouse finished? The answer is never, since the warehouse must be constantly updated to reflect changes in the business e.g. reorganizations, new product lines, acquisitions etc.

Yet this is a problem because today's main data warehouse design approaches result in extremely high maintenance costs - 72% of build costs according to TDWI. If a data warehouse costs USD 3M to build and USD 2.1M to maintain annually then over five years you are looking at costs well over USD 11m (let's generous allow a year to build plus four years of maintenance) i.e. many times the original project cost. These levels of cost are what the industry has got used
to, but these are very high compared to maintenance costs for OLTP systems, which ttypically run at 15% of build costs annually. This high cost level, and the delays in responding to business change when the warehouse schema needs to be updated, contribute to poor perception of data warehouses in the business community, and high perceived failure rates. As noted elsewhere, data warehouses built on generic design principles are far more robust to business change, and have levels of maintenance around 15%.

If the data warehouse industry (and the business intelligence industry which feeds on it) is to continue to grow then it needs to grow up also, and address the issue of better data warehouse design paradigms. 72% annual maintenance costs are not acceptable.

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