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Friday, April 08, 2005

The Death Of The Data Warehouse & Distributed Intelligence

( Via Sriram) Michael M Carter writes the cost,complexity,and utility of the data warehouse will become marginalized as the principles of "distributed intelligence" take hold. Excerpts with edits and my comments added:
Access to key data points in operations of business in real-time provides the enterprise to perform at at optimal levels. End-user organizations must push business intelligence and enterprise application infrastructures, and embrace new methods of gathering, extracting, and consuming information based on web services (XML over HTTP). The data warehouse is dead. Age-old methods of gathering and storing data into centralized warehouses, transforming it into information and generating reports, are inadequate and do not deliver either speed or intelligence to the enterprise. The cost to create a data warehouse is estimated to be nearly $5 million, with additional yearly maintenance costs running around 20% of that figure. Add to that the complexity of report generation, married with the inability to easily connect disparate information sources, and you have an information technology phenomenon of unprecedented proportions that is not just costly but mostly irrelevant to the day-to-day needs of business managers.
The data warehouse will not completely disappear like the minicomputer, it will go the way of the mainframe. The cost, complexity, and utility of the data warehouse will become marginalized as the principles of "distributed intelligence" take hold. The data and information contained in the traditional data warehouse environment is difficult to get at, can't be easily created or administered, and is not in real-time.
The principle of distribution has been applied to the computing, semiconductor, and network revolutions, but has yet to be applied to the problem of information visibility. Names like Intel, Cisco, and Sun were part of the last revolution. Innovators in information visibility will take a new standards-based and technology-agnostic approach. The technology standards movement brought on by web services (XML over HTTP) will enable organizations to apply the principles of "distribution" in the form of portable and real-time business information networks (BINs). In these BINs, organizations can attain new levels of business visibility that will enable them to more nimbly react to market and business changes, and more profitably serve their stakeholders. Business challenges will be brought to light not at the end of a quarter, but on a daily basis, and communicated from the BINs directly to the business managers that need the information.With the advancements brought on by web services and the ability to create loosely coupled technology environments, organizations can leverage their historic methods, and bring the speed and intelligence that business managers need, both to meet the new regulatory guidelines and to exceed the business expectations of their stakeholders.

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