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What Is the Theory Behind Data Integration?

Data is one of the most valuable commodities for businesses. Data provides actionable insights informing critical business decisions, enabling companies to compete globally.

There are many data retrieval, storage, and processing techniques that businesses should utilize to maximize their benefits from data. These techniques include data mining, analysis, virtualization, and integration. Let’s look at how data integration works and how businesses benefit from data integration.

What is data integration?

Data scientists use algorithms and techniques to mine data and turn raw data into useful information. For example, processing historical data enables companies to evaluate how marketing campaigns impacted sales numbers. Business executives use this type of analysis to determine if promotional strategies are effective, enabling them to decide whether to continue a campaign or invest in a new marketing strategy.

Before data scientists can produce insights from data, they must access the data. Many businesses have data stored on multiple computers, cloud servers, and business sites in different cities or countries. Data scientists use data virtualization or integration to access relevant data.

Data virtualization provides access to data from multiple sources without moving or copying that data. Data integration is the traditional method used to combine data from various locations. It involves physically transferring or copying the data to a new location. This new location is a data mart or data warehouse. Data scientists cleanse and transform the data before placing it in the data warehouse.

Data integration tools promote collaboration because all data’s combined and stored in a central location. Instead of having fragmented chunks of data created and stored on diverse systems, the data is transformed into an accessible format.

How do businesses benefit from data integration?

Data integration tools save businesses time. Suppose you want to make Cajun chicken for dinner. You could combine several spices and make Cajun seasoning. Alternatively, you could purchase Cajun seasoning and apply that product to your chicken. You won’t have to spend time pouring over a seasoning recipe, measuring individual spices, and mixing those spices before applying them to your chicken. Instead, you only have to apply one seasoning to your chicken to produce the desired results. This parallels the benefits of integration because your data integration tool automatically transfers and cleans crucial data, ensuring it’s secured in your data warehouse.

Manufacturers and retailers benefit from integration because it provides real-time insights encompassing all data. A computer manufacturer doesn’t have to wait to receive data from different departments. The data integration tool connects to the data sources and automatically moves data sets to the data warehouse, ensuring data scientists can access real-time data when producing reports. The company can use current sales trends to adjust production quotas instead of evaluating old reports to anticipate future demand levels. Additionally, sales enablement tools for manufacturing allow you to close the feedback loop of your marketing, sales, and services operations. It also uses data to manage content automation and sales rep training providing personalized paths for your customers and sales teams. Retailers can use current sales figures to adjust orders, ensuring they stock in-demand products instead of carrying products with lagging sales numbers. Both manufacturers and retailers save money by investing in products consumers want instead of developing, shipping, and stocking unwanted products.

Businesses can also add external data to their integrated data. Companies producing medical equipment may integrate data from reliable news sources, insurance companies, and the National Institutes of Health (NIH) when determining where to invest research and development funds. External data about new diseases and infection rates may enable medical equipment manufacturers to anticipate future demand for diagnostic equipment and medical treatments, causing them to develop products to address those needs.

Integrating and storing data in a data warehouse offers a heightened level of security. Companies can restrict access to authorized users, preventing unauthorized users from accessing or altering data. Additionally, when upgrading storage systems, companies don’t have to worry about transferring data from various sources because all data are already transferred, cleansed, and secured.

Data integration tools enable companies to combine data from various sources. The data’s transformed into a consistent format and used to provide insights that inform business decisions.


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