OLTP Vs OLAP Business Case

OLTP VS OLAP Business Case

Robert Jones is a manager of several Sales Organizations at Global Bike Inc. His responsibilities are to monitor and manage sales activities. He has a number of systems to assist with the recording of day-to-day transactions, and at the end of each month he is provided with a report which displays each sale. The format of the report is illustrated below. Although this report provides a lot of information, the information is not in a format that can easily assist in the type of decisions he is required to make. The sales data is delivered by the IT Department in the following format: The primary purpose of an information system is to process information to produce reports to facilitate decision making. Reports may appear in various formats and used to support a diverse range of organizational decisions. Reports provide a mechanism for organizing, analyzing, presenting and delivering information to end users. A common classification of reports is based on the types of systems which they are built from. On-Line Transaction Processing (OLTP) systems as the name suggests are optimized for transaction processing. They process real time information and are accessed by many users. The reports are derived from the various business transactions and predominately support tactical decision making. An alternative information system is On-Line Analytical Processing (OLAP). This type of processing allows users to analyze information by creating multidimensional reports. They deal with large volumes of aggregated historical data. OLAP based reports are more flexible than the more traditional reports produced by an OLTP system. As mentioned previously OLTP reports provide information about particular transactions. The flexibility of OLAP reporting assists end users in understanding why particular business events have occurred and or forecast what may occur in the future. OLAP systems and their ability for multi-dimensional reporting are considered an important component of Business Intelligence. OLTP systems often provide the transactional data which is used as an input for OLAP system’s multi-dimensional reports. Your task is to suggest to Robert Jones what type of systems (OLTP or OLAP) he can use to find answers to these questions: # Process Systems (OLTP or OLAP) 1 Who purchased a particular product? 2 How much did an employee get paid? 3 How many of a product was manufactured? 4 What are the total sales for each product? 5 What are the total sales for each department? 6 Which salesperson has sold the most? 7 Which products does each salesperson sell the most of? 8 In which month did most of the sales occur? 9 Which customer spent the least amount of money in February? 10 Which customer spent the most in February and which sales person was responsible for the majority of these sales?

Paper For Above instruction

Understanding the differences between Online Transaction Processing (OLTP) and Online Analytical Processing (OLAP) systems is crucial for effective decision-making within organizations like Global Bike Inc. Each system serves distinct functions, optimized for specific types of data processing and reporting, and selecting the appropriate system depends on the nature of the questions being asked.

OLTP systems are designed for real-time, day-to-day transaction processing. They efficiently handle high volumes of simple, routine operations such as recording sales, updating inventories, and processing payments. These systems prioritize speed and data integrity to ensure the accuracy and efficiency of transactional data. Consequently, OLTP systems are ideal for answering questions related to individual transactional details, such as "Who purchased a particular product?" (Question 1), "How much did an employee get paid?" (Question 2), and "How many of a product was manufactured?" (Question 3). These questions require detailed, current transaction data that OLTP systems maintain in normalized databases, ensuring swift retrieval and updating of specific records.

In contrast, OLAP systems are tailored for complex analysis and data mining, aggregating large volumes of historical data from various sources. They utilize multidimensional data structures, often called cubes, to enable flexible, multi-faceted analysis. OLAP is suitable for answering strategic questions that involve summaries, trends, and patterns over time or across categories, like "What are the total sales for each product?" (Question 4), "What are the total sales for each department?" (Question 5), and "In which month did most of the sales occur?" (Question 8). These questions benefit from the summarized, historical data stored in OLAP systems, which facilitate fast retrieval of aggregated information.

Furthermore, questions such as "Which salesperson has sold the most?" (Question 6), "Which products does each salesperson sell the most of?" (Question 7), and "Which customer spent the least or most in February?" (Questions 9 and 10) require analysis of relationships, performance metrics, and temporal trends best captured through OLAP. Analyzing sales performance across different periods or customer segments is resource-intensive for OLTP but straightforward for OLAP, which is optimized for multidimensional analysis.

Overall, for transactional data like individual purchases, payments, and manufacturing details, OLTP systems are appropriate. However, when dealing with aggregated reports, trend analysis, customer segmentation, or sales performance evaluation, OLAP systems are more suitable. Organizations should integrate both systems, ensuring accurate real-time data capture via OLTP systems and comprehensive historical analysis through OLAP solutions. This integrated approach enables business managers like Robert Jones to make informed tactical and strategic decisions based on accurate, timely, and insightful data.

References

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  • Oracle OLAP Overview
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