A report from Survey.com, a Californian market research company, states that organisations worldwide are expected to increase warehousing spending from $37.4 billion in 1999 to $148.5 billion by 2003.
The report says the increase of 43% a year will be driven by rapid growth in the analysis of enterprise resource planning (ERP) data in a data warehouse, and Web-enabling it for business-to-business e-commerce. This combination of ERP and data warehousing has integrity, and provides a solid base for any company that has an interest in becoming part of the extended global business community. The Internet is creating a revolution in business and information sharing.
"The Internet is creating a revolution in business and information sharing."
The buzz is confusing, with companies prefacing all their offerings with the "e" word – sometimes delivering very little additional value. Those that succeed, bring additional benefits as well as catering for high volume transactions across the Internet.
With the exponential increase in the speed of transactions, businesses will have to keep up in replenishing stocks, predicting shifts in trends and responding to individual customer needs. This speed of response needs ready access to information.
ERP and data warehousing are two very different vehicles, but together they make powerful partners, with the ERP system being the production engine, and the data warehouse the repository for e-enabled decision support information. Through the data warehouse, ERP has entered cyberspace with business-to-business enablement.
While the virtual business community works a 24-hour day, the data warehouse becomes an essential tool for continuous analysis and monitoring of ERP activity and the delivery of efficient information to diverse partners on the Web.
Confusion often arises about the ERP and data warehousing core competencies. ERP solutions are usually the backbone of an enterprise's operational system, covering core business and supporting the daily business processes.
Data warehousing provides a consolidated information source able to provide considerable business intelligence as well. Fed with incremental updates from the ERP system, the data warehouse is designed specifically to answer business questions that help solve business problems.
The complexity of the ERP database makes it difficult to query efficiently. Individual transactions affecting stock levels, and future orders need considerable manipulation to give a clear view of the overall picture. This is where the data warehouse becomes a fast and accessible source of information for the business' supplier, as well as a provider of indicators of shifting trends.
Accessing this information over the Internet, the supplier is able to anticipate the need for components or raw materials for the business' manufacturing or assembly process and deliver the right quantities at the right time. The data warehouse offers additional support for just-in-time management techniques and with a more efficient supply chain, the business becomes more profitable. The mobile sales representative can track a customer's ordering history by accessing the data warehouse, and allocate appropriate discounts. To engage in such activity in the ERP system, outside of a data warehouse, would bring the entire system to a grinding halt.
The Internet has made remote computing a reality and while the ERP system gets on with the job of keeping the production and delivery lines going, the data warehouse continues to deliver fast and accurate decision supporting information.
This e-enablement of the data warehouse in the business-to-business environment delivers real value. The shortening of the supply chain using universally available and cost-effective Internet technology makes good business sense.