What is online analytic processing (OLAP)?

Online analytic processing (OLAP) describes queries that are run against a multidimensional data source. While a simple query might ask, "When did order 84305 ship?", a typical series of OLAP queries might ask, "How do sales in the Southwestern region for this quarter compare with sales a year ago? What can we predict for sales next quarter? What factors can we alter to improve the sales forecast?".

Most standard queries involve simple data selection and retrieval. However, OLAP queries are more structured and involve calculations, time series analysis, and quick access to aggregated historical and current data. In OLAP queries, you know the dimensions and hierarchies that measures use. You query the data in business terms, such as "How are my products selling in my regions?" Each dimension has its own selection that mirrors the way that you ask questions.