What is OLAP and what is it for?

In the world of data management, fast and efficient analysis of large amounts of information is crucial to making sound business decisions. This is where OLAP (Online Analytical Processing) technology comes into play, a key analytical tool that allows companies to obtain valuable information quickly and efficiently.

If you are interested in deepening your knowledge in data analysis, the degree in Business and Economics at Universidad Europea will provide you with the necessary skills to master OLAP technology and other advanced tools. 

In addition, at Universidad Europea you can also study the Master in Big Data Analytics in Madrid to train as a data professional.

What does OLAP mean?

To understand what OLAP is, the first thing to know is that it stands for “Online Analytical Processing”. It is a technology designed to facilitate the consultation and analysis of large volumes of data quickly and dynamically.

Businesses or companies collect and store large amounts of data from different sources such as websites, applications, internal systems etc. OLAP is responsible for collecting and categorising this data to provide strategic information.

With OLAP, users can explore multiple dimensions of information simultaneously, which is especially useful for multidimensional analysis and detailed reporting. To work with this technology, it is necessary to first learn databases and master other analysis languages and tools.

Main features of OLAP

• Multidimensional analysis: it allows you to examine data from different perspectives, such as time, location or product.
• Fast queries: OLAP technology is optimized to respond quickly to complex queries where large volumes of data are used.
• Hierarchical data modeling: data can be structured in hierarchies, facilitating analysis at different levels of detail.

What is OLAP used for?

OLAP is primarily used for business decision making, as it allows data analysts to perform in-depth analysis of multiple variables within the organisation, both on-premises and in the cloud. Common uses of OLAP include:

• Sales analysis: sales can be analysed by product, region, time and other dimensions to identify patterns and trends.
• Financial planning: OLAP can analyse multiple scenarios, enabling companies to more accurately perform financial simulations and forecasting.
• Performance evaluation: Companies can use OLAP to compare the performance of different departments or products over time.

OLAP and OLTP: What is the difference?

OLTP (Online Transaction Processing) is another analytics technology used for processing business transaction data. Although both OLTP and OLAP are technologies related to data processing, they serve very different functions within an organisation. 

While OLAP focuses on data analysis, OLTP is used for real-time transaction management, such as purchasing, database updates, or user records. The most important differences between these technologies are as follows:

Functions

OLAP is oriented to the analysis of historical data, while OLTP manages day-to-day operational transactions.

Data structure

In OLTP, data is structured in a simple and efficient way to process transactions quickly, while OLAP organizes data in a more complex structure of multidimensional cubes to facilitate analysis.

Queries

OLTP queries are fast and simple, while OLAP queries can be complex and analyze large volumes of information.

OLAP applications in the business world

OLAP is an essential tool in many business sectors that rely on data analysis to make informed decisions. Among the industries that use OLAP the most are the following:

• Retail: Retail companies use OLAP to analyse consumer preferences and adjust their sales strategies.
• Finance: In the financial sector, OLAP helps with financial modelling, risk analysis, and simulations.
• Telecommunications: Telecommunications companies use OLAP to analyse customer data, usage patterns, and service quality.

OLAP is a must-have tool for any organization looking to get the most out of its data. It allows you to analyse different aspects of business operations efficiently and quickly, resulting in better decision making. Now that you know what OLAP is, and if you are interested in this field, you can continue learning about databases and big data.

If you are looking for some of the more information about the type of programmes on offer at Universidad Europea, you should check the wide variety of  masters in business and technology, in English and Spanish, and at our different campuses in Spain or online, where you can choose the area that interests you the most.