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Making the Most of What You Have
An integrated data warehouse increases business value and reduces expenses.
by Randy Lea
In economic times like these, everyone looks for ways to control expenses and reduce the need for system purchases or upgrades, all while maintaining a robust, steady stream of profitable customers. One key tactic in that pursuit is data mart consolidation, which allows an organization to reduce costs while leveraging data more effectively. With a centralized data warehouse, a company can load the data once and use it many times. On the other hand, employing multiple data marts results in a duplication of infrastructure, with data loaded several times.
Beyond the costs associated with duplicated data, load processes and load tools in that situation, there’s the added expense of maintaining multiple systems from a hardware service and DBA perspective. While data mart consolidation reduces these infrastructure costs, the most important advantage is that all of your data is in one location, thus providing increased insight that extends the business value far beyond mere cost savings.
Integrated data creates a better understanding of customers, products and operations and provides a 360-degree view that could not exist with independent data marts. For example, virtually all airlines can determine which passengers travel frequently and how many miles they fly, but with data siloed in marts, they cannot know an individual’s impact on overall profitability.
To truly understand customer value, an airline also needs to know the price paid for the tickets, the profit margin of the routes flown, whether luggage was carried on or checked, if there were upgrades to a higher class, and myriad other cost and revenue factors—details available only via an enterprise data warehouse.
Once the data is integrated and the insight into customer behavior is achieved, you can expand and leverage that information into your operations. To take the previous example further, imagine that a gate agent has two passengers looking for a free upgrade. With customer history available, the agent can determine which person is more profitable and make an informed decision, as opposed to merely upgrading the one who complains the most.
Why is that important? Because replacing a highly profitable customer is far more difficult than retaining one. So when you’re making service cuts or reducing marketing expenditures, you need to ensure you don’t negatively affect your best customers.
This airline scenario is only one example of how data mart consolidation can inject greater intelligence into decision making and reduce costs in the process. To find out what your savings might be, see our data mart consolidation calculator on Teradata.com. I’m sure the figure will be compelling, but it will pale in comparison to the business value and bottom-line improvement you’ll gain by leveraging the power of integrated data.
Randy Lea is vice president of Global Product and Services Marketing at Teradata.
Photography by Chip Raches