Do I Need a Data Warehouse for Power BI ?

Last Updated : 23rd October 2024

If you have been using Power BI for a while now, you may have heard that you should have a data warehouse. But do you really need one? In the article, we’ll discuss the arguments for and against.

What’s a Data Warehouse?

A data warehouse (DW) is a database which has been designed to hold the data required for reporting. It contains tables which have been designed optimally for use for tools such as Power BI. A DW is populated usually by scheduled feeds from source systems using ETL (Extract, Transform and Load) processes.

Using Power BI without a data warehouse

Power Bi is a great tool. You can use it without any data warehouse at all. Just connect Power BI to some source databases, plus maybe some CSV’s, Excel sources, a few online services and away you go. You can connect the data sources together in Power Query and the Power BI table designer, and come up with some great looking reports in almost no time.

Advantages of using Power BI without a DW

This approach is fast and enables you to create reports and dashboards quickly. You can easily add new data sources and create reports with them within a few hours. All of the data modelling can be done in Power Query by less senior team members.

Stakeholders and end-users will love the way you’ll be able to get reports together quickly. You’ll be a data hero!

However, there is a price to be paid…..

Disadvantages of using Power BI without a DW

Having no data warehouse with Power BI can lead to different teams / individuals creating their own data models, sometimes with the same or similar data. This can mean different datasets and measures across the business and means that there are different versions of the truth.

Data governance can be ignored or sidelined, giving poor data quality and slow / inaccurate reports.

The data model can become complex very quickly. Without proper data warehouse design, the model can become ambiguous, slow, bloated and confusing. Links between tables can become something of a hack-a-thon, leading to very complex DAX code requiring multiple CROSSFILTER and TREATAS statements just to make measures work.

When multiples source systems are being brought together, it can be difficult to join primary / foreign keys. This can leads to (another) messy hack in Power query or DAX, just to make the valid data joins.

Historical change tracking is very difficult, unless the source systems have the correct table structure to facilitate it. For instance, tracking customer address changes over time is often not readily available from the source system and is therefore lost in Power BI.

Using Power BI with a data warehouse

Advantages of using Power BI with a DW

The data warehouse can be designed using industry best-practice, to maximize data accuracy, performance, security and availability.

There will be one version of the truth for all data within the data warehouse.

The data warehouse can be re-used outside of Power BI and the immediate reporting environment.

Advanced techniques such as Slowly Changing Dimensions can be used, for instance to track historical customer data.

Once in place, it will be possible to create reports very quickly and easily.

Disadvantages of using Power BI with a DW

Building a data warehouse can take several months. It is a skilled process requiring data engineers and data analysts, with all of the specific skills and tools that they require to do the job. This costs money and time and will require resources such as Microsoft Azure and on-site connectors.

So, do you need a Data Warehouse?

Well, it really depends on your own circumstances.

Sometimes, just using Power BI with Power Query can be sufficient. If you want to create some compelling reports quickly from one source system, together with a few CSV or Excel files, then that may be all you need.

Larger organizations with multiple source systems or more complex reporting requirements would benefit from a properly designed, fast, accurate data warehouse. It will contain well-defined ETL processes, proper data governance, and a data model based, to some degree at least, on Kimball.

Consultancy & Pricing

We strongly recommend using one of our consultants to assist you with your Power BI and Data Engineering. Our prices start at just £450 a day, plus VAT. You can hire us for a day, week, month or however long suits you.

Before you commit to buying a consultancy or training day from us, contact us to arrange a free no-obligation 30 minute on-line meeting. We can use that to discuss your requirements and to see if we can provide a solution for you.