OLAP applications
description
Transcript of OLAP applications
OLAP applications
Application areas OLAP most commonly used in the
financial and marketing areas Data rich industries have been the
most typical users consumer goods, retail, financial services and transport
General vs. Pre-built OLAP
In increasing number of cases specialist OLAP applications (pre-
built) In most others
general-purpose OLAP tool versatile enough for many
applications
General vs. Pre-built OLAP
Better to have a general-purpose product for multiple applications
Some applications (financial reporting) are complex better to use a pre-built application
Marketing and sales analysis
Most commercial companies require this application
However, large-scale versions of this application occur in three industries: Consumer goods industries Retailers Financial services
Consumer goods industries
Large numbers of products Analyze data monthly, but
sometimes it may go down to weekly
There are usually a number of dimensions, none especially large
Retailers
Due to POS data, huge amounts of data
Large retailers could have over 100,000 products (SKUs) and hundreds of branches
Down to weekly or daily level Even track sales by time of day
Financial services(insurance, banks etc) A relatively new user of OLAP technology
for sales analysis Analyzing data down to individual
customer level which means that the largest dimension may
have millions of members Because of the need to monitor a wide
variety of risk factors, there may be large numbers of attributes and dimensions
Questions that are answered in marketing and sales analysis
1. Are we on target to achieve the month-end goals, by product and by region?
2. Have some new products failed to achieve their expected penetration, and should they be withdrawn?
3. Is our advertising budget properly allocated? Do we see a rise in sales for products and in areas where we run campaigns?
4. Is there a correlation between promotions and sales growth?
5. Are all areas achieving the expected product mix, or are some groups failing to sell some otherwise popular products?
A marketing example In response to a sudden management panic
near a quarter end, a marketing analyst is given a few minutes to analyze the market acceptance of new products
She decides to group 20 products that were introduced between six and nine months ago and compare their sales with a comparable group of 50 products introduced between two and three years ago
A marketing example (cont.) She simply defines two new, on-the-fly, product
groupings and creates a ratio of the new group to the older group
She can then track this ratio of sales revenue or volume by any level of location, over time, by customer sector or by sales group
Defining the new groupings and the ratio takes a couple of minutes, and any of the analyses take a matter of a few seconds to generate, even though the database has tens of thousands of products and hundreds of locations
It doesn’t take more than a total of 15 minutes to spot that some regions have not accepted the new products as fast as others.
A marketing example (cont.) Then, she investigates whether this was
because of inadequate promotion, unsuitability of the new products, or if some areas always accept new products more slowly
She looks at other new product introductions by creating new groupings of products of different ages, and finds that the same areas are always conservative when introducing expensive new products
Management can now decide if there really is a problem, what it is and what to do about solving it
Inventory
Value chain for retailers: The retailer issues an order to a
product manufacturer Products are delivered to retailer’s
warehouse (actual) and held in inventory
Delivery is made to a store, where again the product sits in inventory until it is purchased
Exercise 1
Inventory models Periodic snapshot:
Every day we measure the inventory levels of each product and place them as separate rows in a fact table
Transactions: Record every transaction that has an
impact on inventory levels as products move through the warehouse
Each model tells a different story
Exercise 1
Periodic snapshot Make sure that the right product is in
the right store at the right time (minimize out-of-stock)
4 steps Business process: analyze inventory at
individual stores Granularity: daily inventory by product at
each store Dimensions: ? Facts: ?
Exercise 1
Periodic snapshot Aggregation over date dimension: For a
given item we have Mon: 50 items Tue: 50 items (unchanged) Wed: 100 items (+50 items) Thu: 100 items (unchanged) Fri: 100 items (unchanged)
Week balance is not 400 (50+50+100+100+100)
Inventory levels are not additive over the date dimension
Propose a solution
Exercise 1
Periodic snapshot 60,000 products 100 stores
6,000,000 rows in fact table each day 14 bytes per row 84 MB per day 30 GB per year
Propose solutions (hint: aggregate historical data)
Exercise 1
Transactions Record every transaction to answer questions
like: Which products were returned to the vendor due to
inspection failure? How many separate shipments did we receive from a
given vendor? 4 steps
Business process: analyze inventory transactions at each warehouse
Granularity: daily transactions by product at each warehouse and by each vendor
Dimensions: ? Facts: ?
Exercise 1
Transactions Transaction types:
Receive product Place product into inspection hold Release product from inspection hold Return product to vendor due to inspection failure Authorize product for sale Package product for shipment Ship product to customer Return product to inventory from customer return Remove product from inventory
Exercise 1
Comparison
Compare the Inventory model against the Transactions model What are the differences? Which kind of information gives the
one but not the other? How they complement each other?
Exercise 1
Financial services A bank offers products (called accounts):
checking accounts, savings accounts, mortgage loans, personal loans, credit cards, safe deposit boxes, etc.
Business process: effective market by offering additional products to households Preferable to analyze bank’s relationship with
an entire economic unit, like a household
Exercise 2
Requirements Business users want to see historical monthly
snapshot data on every account Every account has a primary balance Each account has only one household, branch, and
product associated with A household may be comprised of several accounts and
individual account holders. E.g., John and Mary Smith are a single household, but John has a checking account, Mary has a savings account, and together they have a credit card
All these accounts/products are considered to be part of the Smiths’ household
Additionally to household identification, we are interested in demographic information about customers and households (income, children, household, etc.)
Exercise 2
Granularity
Record the primary balances of every account at the end of each month Are they additive w.r.t. time? Record other metrics as well: interest
paid, interest charged, etc. Dimensions? Facts?
Exercise 2
Financial reporting Every organization has responsibilities
for producing financial reports for internal (management) consumption
Even the simplest financial consolidation consists of at least three dimensions It must have a chart of facts (measures) at least one organization structure plus time
General Ledger (G/L)
Core foundation of financial systems. Ties together information collected by: Purchasing Payables (what you owe to others) Receivables (what others owe you)
At the end of each fiscal period (may not relate directly to a time period)
Exercise 3
General Ledger (G/L) Business process: perform G/L by recording
balance amounts as periodic snapshots Grain: one record per fiscal period Main source of information: chart of accounts
Identify the account type. E.g., 1,000 – 1,999 asset accounts, 2,000-2,999 liabilities (intelligent keys, do we need them in the warehouse?)
Each account is associated with organizational cost centers (hierarchy: cost center, department, division)
Each account is associated with a set of books For every organizational cost center in an account,
there is a single book
Exercise 3
General Ledger (G/L)
Dimensions? Facts: are balance amounts
additive?
Exercise 3
All exercises
Report in each design three questions that can be answered (scenarios)