The future of all data seems to be in the cloud. Everyone, from a personal phone user to large enterprises, is looking to store their data on cloud platforms to capitalize on the many benefits they offer. As companies are increasingly becoming dependent on data, the amount of data generated every day is also steadily increasing.
While storing data on-premises has been the norm for industries for many years, it has presented considerable challenges for data analysts and business users alike. As a result, cloud data warehousing has been developed to leverage and retrieve data from different sources without physically being present on-premises or designing complex warehouse architectures.
This blog will look at what a cloud data warehouse is and how it is developed. Additionally, we will discuss five of the most compelling benefits of migrating your on-premises data warehouse to the cloud.
What is a Cloud Data Warehouse?
Cloud data warehouses can be thought of as a shared repository that connect various clients in geographically distant locations and provide access to clean, high-quality data. Buying and setting up physical servers is becoming obsolete as more and more companies realize the benefits of cloud-based repositories.
Some of the most popular cloud service providers include Google BigQuery, Snowflake, Amazon Redshift and Microsoft Azure SQL Server. These platforms provide maintenance features, aid in the design of the data warehouse, and are regularly updated to adapt to the ever-changing demands of their clients.
Now that we have a basic understanding of a cloud data warehouse, the next step is to consider whether moving to the cloud is the right step for your company or not.
Benefits of a Cloud Data Warehouse
1. Cost Efficiency
Building a data warehouse involves many expenditures, including maintenance costs, licensing fees, the initial cost of setting up the warehouse infrastructure, hardware costs, and costs incurred to ensure data security. This can amount to thousands of dollars annually for large enterprises. In addition, the obsolescence of these warehouses must also be acknowledged, and they require a lot of effort from developers and coders to function according to industry standards.
On the contrary, cloud-based data warehouse services provide the latest features and functionality while significantly reducing costs. These services save money on building and maintaining a physical data warehouse. They can easily be operated by business users using proprietary software. Additionally, companies can choose which features they want to opt for and design a service package tailored to their needs and budget allowance.
Realizing the importance of flexibility of geographic location for employees is the benchmark of a modern organization. Multinational companies are branched across the globe and need a decentralized repository for data from various business networks. On-premises data warehouses do not allow for such accessibility and require data analysts to be present on-site to retrieve information.
In contrast, cloud-based data warehouses are designed to provide access to data on the go for employees that need to travel a lot or those that prefer working from home. The COVID-19 pandemic forced many companies that were previously working on the traditional data warehouse model to modernize, as workplaces have realized the potential of a dispersed and reorganized model.
3. Improved Performance
Cloud-based data warehouses can handle multiple data streams simultaneously, allowing various departments within companies to perform their business processes seamlessly. Since data is processed and stored on the cloud, users do not require expensive hardware to access it. In addition, cloud-based warehousing services are expandable and can easily handle more data cases than expected. In such a situation, the enterprise can choose to purchase additional storage.
Cloud data warehouses are built upon several servers working together, and therefore, data speed is optimized for faster processing across all channels. This is a giant leap forward from traditional data warehouses that could only handle a finite amount of data at any given time and performed individual tasks on separate servers, making overall task completion slow and inefficient.
The sensitive nature of enterprise data makes security a primary concern for data analysts and business professionals worldwide. While traditional data warehouses have specific protocols to ensure data remains secure, new threats and viruses make them vulnerable to breaches. Thus, the security of on-premises data warehouses largely depends on the expertise level of IT teams and how well-equipped they are to deal with such problems. Physical data warehouses are also at risk of data loss in case of a disaster at the site. Server rooms must be constantly monitored and protected from high temperatures, fire hazards or water.
On the other hand, cloud data warehouses have extensive mechanisms to protect data, whether stored or transmitted. These platforms are regularly updated to provide a robust defense against viruses and infiltrations of all kinds.
In addition, they are usually based on a role-based access system, so each user can use the data warehouse according to the permissions that have been assigned by the administrator. Lastly, cloud data warehouses have backups of data stored in different geographic zones worldwide to protect data in case of a mishap.
5. Seamless Integration
The disparity in structure and file formats of data from various sources makes it a problem for data analysts to consolidate and store it. On-premises data warehouses require extensive coding and data manipulation to integrate data and generate insights from it. Additionally, unstructured data needs to be manually extracted and saved into the data warehouse. In this case, data often gets stuck in silos, making it challenging to analyze and understand it.
Luckily, cloud-based data warehouses cater to this problem and provide a vast array of integration options to quickly store and transform data from various sources. Cloud-based data integration can easily handle data on the web, in databases, or file formats such as XLSX, CSV or PDF. This can save hours of effort on coding and architecture setup, making the whole data storage process simpler and more efficient.
As data is quickly becoming the crux of enterprise development, companies need to take all the necessary steps to leverage it effectively and harness its power. On-premises data warehouses no longer offer the speed and functionality that is characteristic of a truly modern business.
Cloud-based data warehouses are here to stay, and companies who migrate to the cloud before their competitors will benefit from a significant first-mover advantage. The benefits mentioned above are just the tip of the iceberg; cloud-based data warehouses save the time and effort of IT teams and make all data processes accessible to business users. As companies lean towards efficiency and automation, migration to a cloud-based service appears to be the only solution for efficient data management.
Read for more blog: 5e lifestyle