What Exactly Is OLAP?


On-Line Analytical Processing (OLAP) is a category of software technology that enables analysts, managers and executives to synthesize and analyze large volumes of data through fast, consistent, interactive access to a wide variety of possible views of information. Typically, the information presented has been transformed from raw data to reflect the real dimensionality of the business as understood by the user.

OLAP functionality is characterized by dynamic, multi-dimensional analysis of consolidated business data. To effectively support end-user analytical and navigational activities, OLAP engines enable:

• calculations and modeling applied across dimensions, through hierarchies and/or across members;
• trend analysis over sequential time periods;
• slicing subsets for on-screen viewing;
• drill-down to deeper levels of consolidation;
• reach-through to underlying detail data;
• rotation to new dimensional comparisons in the viewing area.

Examples of OLAP Implementations:

• Sales and marketing analysis
• Customer & Product Profitability
• Financial Consolidation
• Supply and Demand forecasting
• Financial modeling (Budgeting, Planning)
• Loss ratio analysis
• Claims experience analysis
• Human resources analysis
• Market share analysis
• Resource allocation and capacity planning
• Variance analysis