Hi Justin,
you are right, the compression is related to the delta merge - and therefore, as long as delta merges happen automatically, compression will also happen automatically.
SAP HANA has two compression stages on the column store: the first - and typically dominating one - is the implicit compression obtained from using a data dictionary for all column-store columns.
The second stage is often called "sparse compression" - it offers additional compression on top of the dictionary compression, with several available algorithms. During the "optimize compression" run, the most appropriate compression algorithm is chosen for each column (and some columns may not be sparse-compressed at all, because it would not bring a benefit).
The optimize compression run does not happen with every delta merge. Instead, it will be performed with the first delta merge on a given table, and then only if the data content of the table has changed significantly (typically, if I remember correctly, the system waits until the number of records has doubled. Note that the optimize compression run may _change_ the compression type chosen for a given column. The sparse compression itself will be done with every delta merge, using the algorithms selected in the past optimze compression.
If you have switched off automatic delta merging globally, or if you have disabled automatic delta merging for a given table, there will also be no automatic compression (in the entire system or on the given table). BW on HANA uses the smart merge feature, so that in a standard BW on HANA, automatic compression will happen (with the timing of the delta merge being decided in a cooperation between BW and HANA).
Best,
Richard