Transforming Your Data Pipeline with dbt(data build tool)

Abhishek Kumar 10 Jul, 2024
11 min read


Have you ever struggled with managing complex data transformations? In today’s data-driven world, extracting, transforming, and loading (ETL) data is crucial for gaining valuable insights. While many ETL tools exist, dbt (data build tool) is emerging as a game-changer.

This article dives into the core functionalities of dbt, exploring its unique strengths and how it sets itself apart from traditional ETL solutions. We’ll delve into the key features of dbt, providing a solid foundation for understanding this powerful tool. In subsequent articles, we’ll explore the practical aspects of implementing dbt to streamline your data transformation workflows.


  • dbt (data build tool) revolutionizes data transformation with modular workflows and robust collaboration features.
  • Includes version control, automated testing, and documentation generation for reliable data pipelines.
  • Contrasts with traditional ETL by promoting code reuse, transparency, and efficient data management.
  • Enhances data integrity and scalability, ideal for modern data stacks and agile analytics environments.
  • Explores upcoming articles on implementing dbt, covering project setup and advanced features for optimized data workflows.
data build tool

Modern Data Stack

Gone are the days of monolithic data warehouses! The modern data stack embraces a modular approach, replacing the traditional SMP (Symmetric Multiprocessing) data warehouse with the agility of cloud-based MPP (Massively Parallel Processing) services. This shift allows for independent scaling of compute and storage resources. Unlike the old times, when everything was tightly coupled and expensive to manage, the modern data stack offers a more flexible and cost-effective way to handle ever-growing data volumes.

Modern data stack

Slowly Changing Dimensions (SCDs): Keeping Up with the Flow

Data warehouses store historical information, but dimensions (descriptive data) can change over time.  SCDs (Slowly Changing Dimensions) are techniques to manage these changes, ensuring historical accuracy and flexibility for analysis. Here’s a breakdown of the most common SCD types:

Type 0 SCD (Fixed): The Unchanging Truth

This type applies to dimensions that never change. They represent attributes with inherent, fixed values.

  • Example: A customer’s date of birth, social security number (assuming anonymized), or a country code. These attributes remain constant throughout the customer’s record.
  • Pros: Simplest to manage, ensures data integrity for unchanging attributes.
  • Cons: Limited applicability, not suitable for attributes that can evolve over time

Type 1 SCD (Overwrite): Simple but Limited

The simplest approach. When a dimension attribute changes, the existing record is overwritten with the new value.

  • Example: A customer’s address in a sales table. If they move, the old address is replaced with the new one. This loses historical data.
  • Pros: Easy to implement, efficient for frequently updated dimensions.
  • Cons: No historical tracking, unsuitable for analyzing trends based on dimension changes.

Type 2 SCD (Add Row): Tracking History

It creates a new record whenever a dimension attribute changes. The original record remains intact, with an “end date” to mark its validity period. A new record with a “start date” reflects the current state.

  • Example: A product table with a “description” field. If the description is updated, a new record is added to the new description, and the old record is marked as valid until the update.
  • Pros: Provides a complete history of dimension changes, ideal for trend analysis.
  • Cons: This can lead to table size growth and requires additional logic to identify the current record.

Type 3 SCD (Inactivate & Update): Flag for Change

Similar to Type 1, the existing record is updated with the new value. However, an additional flag indicates if the record is active or inactive (historical).

  • Example: An employee table with a “department” field. If the department changes, the existing record is updated with the new department and flagged as “inactive”. A new record is created with the current department and flagged as “active”.
  • Pros: More space-efficient than Type 2, easier to query for current data.
  • Cons: It loses some historical detail compared to Type 2 and requires managing the “active” flag.

Also Read: Getting Started with Data Pipeline

What is dbt(data build tool)?

dbt(data build tool) supercharges your data transformation process! Think of it as a toolbox that helps you work faster and produce cleaner results. Dbt makes collaboration and sharing with your team a breeze by breaking down complex transformations into reusable steps.  It also adds safety features like version control and testing, similar to software development, to ensure high-quality data. Plus, you can review everything before deploying it and monitor its performance to catch any bumps in the road. 

Data Pipeline with dbt

dbt(data build tool) Features

Here are dbt features that you must know:

  1. Modular Transformations: Break down complex data transformations into smaller, reusable models for easier collaboration and management.
  2. Version Control: Track changes to your models, allowing you to revert to previous versions if necessary.
  3. Testing Framework: Write automated tests to ensure your data transformations produce accurate results.
  4. Documentation Generation: Automatically generate clear documentation for your models, improving transparency and understanding.
  5. Safe Deployment: Review and test your data transformations before deploying them to production, minimizing errors.
  6. Materializations: Configure how your models are materialized in the data warehouse, ensuring efficient data storage and retrieval.
  7. Templating Language (Jinja): Use control flow statements and loops within your SQL queries for greater flexibility and code reuse.
  8. Dependency Management (ref function): Define how models are executed, ensuring data transformations happen in the correct sequence.
  9. Built-in Documentation: Write descriptions and version control your model documentation directly within dbt.
  10. Package Management: Share and reuse code across projects with public or private dbt package repositories.
  11. Seed Files: Load static or infrequently changing data from CSV files to enrich your models.
  12. Data Snapshots: Capture historical data at specific points in time to analyze trends and changes effectively.

Core Concepts of dbt(data build tool)

Here is the core concept of dbt:

dbt(data build tool) Models

In dbt, models are the fundamental building blocks for transforming data. They act as reusable blueprints that define how raw data is transformed into clean, usable datasets for analysis. 

Here’s a breakdown of what dbt models are and what they do:

  • Structured like SQL Queries: Each model is essentially a SQL query wrapped in a file. This query defines the transformations needed to convert raw data into the desired format.
  • Modular and Reusable: Complex transformations can be broken down into smaller, independent models. This promotes code reusability, simplifies maintenance, and improves collaboration.
  • Dependencies and Lineage: Models can reference other models using the ref function. This establishes a clear lineage, showing how data flows through your transformations and ensuring the correct execution order.
  • Testing and Documentation: dbt allows you to write automated tests to validate your models’ results. Additionally, you can document your models directly within dbt, capturing information about their purpose, usage, and logic.

Benefits of Using dbt Models

  • Improved Data Quality: By defining clear transformations and leveraging testing frameworks, dbt models help ensure the accuracy and consistency of your data.
  • Increased Efficiency: Modular models promote code reuse and streamline development, saving time and effort for data teams.
  • Enhanced Collaboration: Clear documentation and lineage make it easier for data teams to understand and work with models, fostering collaboration.
  • Version Control and Reproducibility: Version control allows for tracking changes and reverting to previous versions if needed. This ensures reproducibility and facilitates troubleshooting.

In essence, dbt models are the workhorses of data transformation. They empower data teams to build robust, maintainable, and well-documented data pipelines for reliable and insightful analytics.

Example – Model (orders_cleaned.sql)

This model cleans and transforms the “orders” table

#Apply transformations like converting strings to dates
  cast(order_date_string as date) as order_date_clean,
from {{ source('raw_data', 'orders') }};


This model references the source table orders from the schema raw_data using the source function.

It selects specific columns and applies transformations (e.g., converting order_date_string to a date).

Sources and Seeds: Building the Foundation for dbt Models

dbt relies on two key elements to establish a solid foundation for your data transformations: sources and seeds.


  • Think of them as the starting point. Sources define the raw data tables residing in your data warehouse that dbt models will reference for transformation
  • Benefits:
    • Clarity and Traceability: Explicitly declaring sources makes your models easier to understand and trace the origin of data.
    • Data Freshness Checks: dbt provides tools to check the freshness of source data, ensuring it’s up-to-date for accurate analysis.
    • Standardized Data Access: Sources promote consistent access to raw data within your dbt project.


# Define sources in a YAML file
    type: redshift
    schema: my_schema


  • This YAML file defines sources. Here,  raw_data is a Redshift source pointing to the schema my_schema.


  • Imagine them as pre-populated data for specific scenarios. Seeds are typically CSV files stored within your dbt project.
  • Use Cases:
    • Static Data: Load reference tables with fixed values (e.g., country codes and names).
    • Test Data: Populate your models with sample data for testing purposes.
    • Infrequently Changing Data: Load data that updates less frequently than your main data sources (e.g., company structure).
  • Benefits:
    • Version Control and Reproducibility: Track changes and ensure consistent test data across environments.
    • Faster Development and Testing: Pre-populated data allows for quicker model development and testing without relying on external data sources.
    • Improved Data Quality: Seed data can be used to validate transformations and ensure data integrity.


# This CSV file contains seed data
US,United States


  • This CSV file (named countries.csv) serves as seed data containing country codes and names.
  • dbt can load this data into your warehouse using the seed command.

Working Together

Sources and seeds work in tandem to provide a powerful foundation for dbt models. Sources define the raw data landscape, while seeds offer flexibility for loading specific datasets when needed. This combination allows data teams to build robust and efficient data transformation workflows.

Snapshots: Capturing the Flow of Time in Your Data

In the world of data analysis, things are rarely static. Data evolves over time, and sometimes you need to track those changes to understand trends or analyze historical states. This is where dbt snapshots come into play.

What are dbt(data build tool) Snapshots?

Imagine a time machine for your data warehouse. dbt snapshots allow you to capture historical versions of your data alongside the current state. Essentially, they create a version control system for your mutable data sources (tables that can be updated).

How do Snapshots Work?

  • Type-2 Slowly Changing Dimensions (SCDs): dbt snapshots implement a specific approach called Type-2 SCD. This means whenever a record in your source table changes, a new record is added to the snapshot table. The original record is kept intact with an “end date” to mark its validity period. A new record with a “start date” reflects the current state.
  • Metadata Columns: dbt automatically adds metadata columns to your snapshot tables. These typically include dbt_valid_from and dbt_valid_to, indicating the timeframe during which a particular version of the record was valid.

Benefits of Using dbt Snapshots:

  • Historical Analysis: Analyze trends and patterns by querying historical versions of your data.
  • Auditability: Track data changes and understand how your data has evolved over time.
  • Debugging: Identify potential issues in your data transformations by comparing historical and current states.
  • Regulatory Compliance: Certain regulations may require retaining historical data. Snapshots provide a way to meet these requirements.

Things to Consider with Snapshots:

  • Increased Storage Requirements: Snapshots can lead to data duplication and require additional storage space.
  • Complexity: Managing snapshots adds complexity to your data model and requires additional maintenance.

Overall, dbt snapshots offer a valuable tool for understanding how your data has changed over time. However, it’s crucial to weigh the benefits against potential drawbacks and storage considerations before implementing them in your project.

Example  – Snapshot (orders_snapshot.sql):

{% snapshot orders_snapshot %}







  -- Add metadata columns for snapshotting



from {{ source('transformed_data', 'orders') }};

{% endsnapshot %}


  • This model uses the snapshot block to create a snapshot table named orders_snapshot.
  • It selects data from the transformed orders table (assuming it’s in the transformed_data schema).
  • dbt automatically adds dbt_valid_from and dbt_valid_to columns to track the validity period of each record.

dbt Tests: Ensuring the Trustworthiness of Your Data Transformations

In the realm of data pipelines, trust is paramount. You need to be confident that your data transformations are producing accurate and reliable results. This is where dbt tests come into play. They act as a safety net, ensuring the integrity of your data and preventing downstream issues.

What are dbt Tests?

dbt tests are essentially assertions you write to validate the output of your data models. They are like mini-queries that check for specific conditions or patterns in the transformed data.

There are two main types of dbt tests:

  • Data Tests: These tests typically compare the results of your model against expected values. They can check for things like:
    • Presence of null values in specific columns
    • Uniqueness of certain identifiers
    • Existence of expected data based on comparisons with other models
  • Unit Tests: These tests delve deeper into the logic of your model. They allow you to create mock data and verify if the model behaves as intended with that data. This helps isolate issues within the model’s SQL code itself.

Benefits of dbt Tests

  • Improved Data Quality: Tests catch errors and inconsistencies in your data transformations, leading to cleaner and more reliable data.
  • Early Error Detection: By running tests during development, you can identify issues early on, saving time and effort compared to debugging errors in production.
  • Increased Confidence: Automated tests provide peace of mind, knowing your data pipelines are functioning correctly.
  • Regression Prevention: Tests help ensure that changes to your models don’t unintentionally introduce new errors.

Writing dbt Tests

dbt allows you to write tests directly within your model files using the test block. You can leverage SQL within these blocks to express your assertions.

Overall, dbt tests are a critical component of a robust data transformation workflow. By incorporating them into your development process, you can ensure the quality and reliability of your data, leading to more accurate and trustworthy insights.

Also Read: All About Data Pipeline and Its Components


dbt has emerged as a game-changer in the data transformation landscape. By offering a modular, collaborative, and feature-rich approach, it empowers data teams to build robust and reliable data pipelines. This article has provided a comprehensive overview of dbt’s core functionalities, equipping you with a solid understanding of its capabilities.

Key Takeways

  • Modular Transformations: Breaking down complex tasks into reusable models for efficient development and maintenance.
  • Version Control and Testing: Ensuring data quality and reproducibility through version control and automated testing frameworks.
  • Documentation: Promoting transparency and collaboration with clear model documentation.
  • Safe Deployment: Minimizing errors through the ability to review and test transformations before deployment.
  • Materializations: Configuring data storage and retrieval strategies for optimal performance.
  • Templating Language (Jinja): Enhancing code flexibility and reuse with control flow statements and loops within SQL queries.
  • Dependency Management: Defining the execution order of models for a well-defined data transformation sequence.
  • Package Management: Sharing and reusing code across projects for increased efficiency.
  • Seed Files: Facilitating faster development and testing with pre-populated data.
  • Data Snapshots: Capturing historical data for trend analysis and auditability.

We’ve also delved into the practical aspects of dbt, showcasing examples for models, sources, seeds, and snapshots. Additionally, we’ve highlighted the importance of dbt tests in safeguarding data integrity.

In the next article, we’ll take a deep dive into the implementation aspects of dbt. We’ll guide you through setting up a dbt project, building models, and leveraging its features to streamline your data transformation workflows. Stay tuned to unlock the full potential of dbt and transform how you manage your data!

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Frequently Asked Questions

Q1. What is dbt(data build tool)?

A. dbt (data build tool) is an SQL-based transformation tool for building analytics-ready data in your data warehouse. It enables modular, version-controlled data transformations.

Q2. How does dbt improve data transformation workflows?

A. dbt enhances workflows by promoting code reuse, transparency, and collaboration. It allows teams to build, test, and document SQL-based models for transforming raw data into actionable insights.

Q3. What are the benefits of using dbt’s testing framework?

A. dbt’s testing framework ensures data quality by enabling automated tests within SQL queries. These tests verify data integrity, uniqueness constraints, and other conditions before deployment, ensuring reliable outputs.

Q4. How does dbt handle version control?

A. dbt integrates version control for SQL-based models, enabling teams to track changes, revert to previous versions, and maintain a clear history of transformations. This ensures reproducibility and minimizes errors in data pipelines.

Q5. Why is documentation important in dbt?

A. Documentation in dbt provides clear insights into SQL-based models, their purpose, dependencies, and transformations. Automatically generated documentation improves transparency, facilitates collaboration, and aids in project maintenance.

Abhishek Kumar 10 Jul, 2024

Frequently Asked Questions

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