According to Cision, the cloud data warehouse market share is expected to grow by $10.42bn in 5 years—between 2021 and 2026. These statistics paint a clear picture of the exponential growth of cloud-based solutions, which are fast displacing their on-premise counterparts that were the hottest thing in tech just a couple of years ago. Businesses moving towards cloud data warehouse solutions isn’t a mere coincidence. What entrepreneurs find attractive is the technology’s ability to support business intelligence as well as its efficiency. It’s also designed for aggressive data growth, making it the perfect choice for enterprises looking to scale in the future. This article focuses on traditional data warehouse vs cloud data warehouse, digging deeper into the benefits of the latter and sharing insights as to why your company should consider migrating to a cloud-based solution. But first… What is a Cloud Data Warehouse? A cloud data warehouse is a system in the public cloud that gathers, stores, and manages crucial business data. It’s a centralized repository for information collected from various disparate systems that entrepreneurs can leverage to gain invaluable insights into business processes. With organizations generating huge amounts of data, entrepreneurs are increasingly turning to cloud-based data warehouse services to address their data storage and analytics needs. Furthermore, these systems undergo regular upgrades to facilitate the storage of big data as well as faster processing, making them a perfect fit for SMEs and established brands. Thanks to data engineering, companies also enjoy easier access to disparate data, improving their analytical capabilities which translates to informed business intelligence insights and ultimately, an increase in net earnings. Major Differences Between Cloud Data Warehouses and On-premises Since data warehouse solutions are a mainstream technology and essential for business growth, entrepreneurs will often ponder whether to create it on-premises or in the cloud. Below we are going to look at their differentiating factors, helping you decide which is the best approach. Let’s delve into the specifics. On-premises Data Warehouses Complete control over the tech stack On-premises data warehouses allow organizations to use their desired tech stacks. That means that a company can use software applications and hardware of their choice, and give access to whoever they deem fit. For instance, if the system suffers downtime, the relevant in-house IT specialists will handle the issue quickly and will not need the help of third parties as is the case with cloud-based systems. Local speed and performance Since on-premises warehouse systems work locally, they rarely experience network latency - even if the server is off-site. However, note that impeccable performance (in this case) is not always guaranteed. Even with minimal delays in network communication, the company may experience subpar system performance as a result of low memory mediums, improperly working hardware and misconfigured servers. Governance and regulatory compliance Entrepreneurs who choose on-premises solutions are responsible for all or a significantly large portion of the system’s governance and regulatory compliance. As such, they will not have any problems, for instance, identifying data location which is among the GDPR requirements. This also means that these companies will need to single-handedly monitor security performance which requires substantial resources and can be overwhelming especially for enterprises. Cloud-based Data Warehouse Solutions On-demand scalability The exploding popularity of cloud data warehouse platforms is a result of the ability to grow and shrink data management to meet the changing business demands. Such elasticity is vital for growing businesses as it allows them to efficiently handle their growing workload. Cost efficiency Cloud data warehouses reduce the need for hardware and other expenses related to setting up servers - meaning lower initial capital investments. It also has fewer labor and maintenance demands, allowing the company to enjoy extensive financial savings. Bundled capabilities such as IAM and analytics With a cloud-based data warehouse, people in business can harness the power of other robust cloud services, including but not limited to data analytics, virtual computing, identity, and access management services, VPNs, CDNs, and auto-scaling services. Security Since data security is a top business concern, top cloud data warehouse providers leverage tech solutions, and implement policies and procedures to protect these systems and their associated data. They actively stay true to the core principles of information security and governance as well as support regulatory compliance to provide best-in-class security. System uptime and availability When signing up for cloud services, users expect impressive system uptime with minimal network interruptions, and this is what they get. Generally, reputable cloud data warehouse providers guarantee clients service level agreements of not less than 99.9% availability for their services. Meaning, the total hours of system downtime in a year should be 9 hours or less. To facilitate reliable services, cloud providers will go a notch higher to implement the right tools and resources, as well as engage the help of professional cloud developers to ensure data accessibility during unprecedented disruptions. That way, authorized users can access company data remotely 24/7. Benefits of Cloud Data Warehouse for Your Business As illustrated above there are numerous benefits of a data warehouse set up in the cloud. Scalability and Elasticity Generally, cloud computing leverages IT resources and infrastructure that can be expanded or decreased to address company needs. And the data warehouse cloud architecture is not any different as it will handle increased workloads without crashing or experiencing performance issues. The cloud DWH system is also elastic. This means entrepreneurs can increase or decrease data storage and management resources in line with business demands. And this is done without affecting cloud operations. Such elasticity allows the system to seamlessly adapt to the organization’s changing workloads throughout the year, boosting and lessening resources as needed. Seasonal businesses particularly appreciate this feature as they do not pay for the unused capacity. Accessibility Cloud systems were built for universal accessibility. As long as you have an internet connection, you can access data at any time and from across the globe. And the best thing? Providers put security protocols in place that allowed only authorized persons to access this data. The system maintains data integrity even with multiple people working on the same data simultaneously. Integration Since data warehouses gather data from various sources, improving connectivity between these systems is imperative. Cloud-based data warehouse solutions harness the power of modern-day technologies and tools to integrate with third-party applications. The applications you choose depend on your business needs and existing infrastructure. As a result, companies enjoy the flexibility that comes with robust data management solutions, which optimize business processes - ultimately translating to workplace efficiency and an increased competitive edge. Data Storage Data storage is one of the major challenges companies face as they expand business operations. Many companies will need to purchase high-tech servers to serve as additional storage, which can be expensive. As such, many companies are choosing cloud-based data warehouse systems as they offer a variety of remote storage options to suit your organization’s storage needs. They are also cheaper compared to buying physical storage infrastructure. Furthermore, businesses can manage storage capacities, adjusting to their current workload which, in turn, ensures long-term savings. Performance Cloud DWH platforms outperform their on-premises counterparts in that they have better network performance. They can easily process large volumes of data without delay and boast impressive system uptimes. To ensure customer satisfaction, cloud DWH providers perform regular automatic performance upgrades. Meaning, you will always enjoy optimal services with minimal to no lag times. Besides, DWH set up on the cloud offers automatic scaling, a feature many enterprises find appealing. During times when operations are at peak level, the business can scale as high as it can, boosting performance. Effective Disaster Recovery Human error, malware, software corruption, and hackers might cause data loss, bringing business operations to its knees. Luckily, cloud DWH platforms offer regular backups that keep company information secure without the need. Besides, recovery is fast and easy, ensuring business continuity. Why Your Company Should Consider Migrating to a Cloud Data Warehouse Switching to cloud data warehouses is a strategic move as it uses information that would otherwise be stuck in silos. The company’s marketing, finance, sales, and logistics department can then leverage information from the different data points to create reports and for other analytical purposes. Furthermore, having a data warehouse in the cloud boosts business performance and allows faster data processing, which effectively minimizes bottlenecks. Providers also invest in multi-layered security protocols that keep information secure. Additionally, it is more cost-effective than on-premises solutions and supports scalability, whether your data needs dip or rise. End Note From the above insights about on premise and cloud-based solutions data warehouse, we can unanimously conclude that the latter carries the day. They are beneficial for business intelligence automatically giving you a competitive advantage. When your business is ready to take this bold yet essential move, Symphony will hold your hand. We are a reliable partner, offering robust cloud data warehouse consulting services to scale your business to the next level. As full-cycle DWH development experts, we will build an effective strategy customized to your company's needs. Our agile IT professionals will migrate your data in minutes, help you scale as needed, and optimize system performance. Contact us for more information.