Explain the ETL Process of a Data Warehouse with a block diagram. How is it different from ELT?
Model Answer
ETL stands for Extract, Transform and Load. It is the backbone process of a Data Warehouse through which data is collected from various source systems, cleaned and transformed into a consistent format, and then loaded into the Data Warehouse for analysis. ETL ensures that only reliable, integrated, and business-ready data enters the warehouse.
1What is ETL?
2The Three Stages of ETL
Data is pulled from multiple heterogeneous source systems (OLTP databases, flat files, APIs, spreadsheets). Only the relevant data needed for the warehouse is extracted. Two types: Full extraction (entire source) and Incremental extraction (only changed records).
The core stage. Raw data is cleaned (remove nulls, duplicates), validated (enforce business rules), converted (data type mapping, format standardisation), and integrated (resolve schema conflicts, de-duplicate across sources). Aggregations and surrogate key generation also happen here.
Transformed, clean data is loaded into the target Data Warehouse. Two approaches: Full Load (replaces all data — used initially) and Incremental Load (appends only new/changed records — used for regular updates). Bulk loading tools are used for efficiency.
3Layered Implementation of ETL
4ETL vs ELT — Key Differences
Transformation happens BEFORE loading, in a separate staging server or ETL engine. Best for structured data and when the target warehouse has limited processing power. Traditional approach.
Data is loaded into the target system FIRST, then transformed INSIDE the warehouse using its own processing power. Best for cloud data warehouses (e.g. Snowflake, BigQuery) that have massive compute. More modern approach.
5How to Improve ETL Performance
Key Formulas
ETL Flow: Source Systems → Extract → Staging Area → Transform → Data Warehouse → Load
Incremental Load: Load only records where last_modified > last_ETL_run_timestamp
💡 Exam Tip
Draw the block diagram first — examiners give marks for diagrams even if the theory is incomplete. Always mention all three stages with 2-3 bullet points each. For ELT difference, a small comparison table earns extra marks. This topic appears in almost every paper — memorise the layered ETL diagram.