An executive officer is interested in the difference in cost for shipping goods to the Southeast versus sending goods to the Southwest. The executive passes along his request to an analyst, who then takes the responsibility of creating the report. The analyst requests the information through a network server. The server searches a database for the relevant data and presents a report with the findings. The analyst turns the report over and the executive uses the information to modify the business model.
On Line Analytical Processing
The preceding scenario is an example of Online Analytical Processing, or OLAP. OLAP is an application that performs multidimensional online analysis. The process turns raw corporate data into usable information. Reports are often created with graphics such as bar and line charts to visibly show trends.
There are five basic components to OLAP; software, networks, servers, databases and data. OLAP software enables a user to create representative charts of the results of a requested search. Networks allow for the flow of information while servers retrieve the requested data from databases. The database is where the data generated by a business is stored.
The multidimensional aspect of OLAP allows a user to study a variety of factors. In the above example there are three different factors. The cost of shipping goods is one dimension, the Southeast is one dimension and the Southwest is the other dimension. The results are visually represented in chart fashion. The data can also be segregated in hierarchal fashion. For instance one can compare sales in two regions by year, quarter, month or even day.
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