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Data Flow Diagram

A data flow diagram (DFD) illustrates how data is processed by a system in terms
of inputs and outputs. As its name indicates its focus is on the flow of
information, where data comes from, where it goes and how it gets stored.
DFD is a designing concept used to transform a textual problem into pictorial or
graphical form in a hierarchical order.
It describes how data and information are transformed in a system in a pictorial
DFD provides a complete description of: (a) What data are processed?
(b) How processing is done?
(c) What data are stored?
(d) Which stored data are used and
(e) Where the result flows?
There are essentially two different types of notations for data flow diagrams
(Yourdon & Coad or Gane & Sarson) defining different visual representations for
processes, data stores, data flow and external entities.
Yourdon and Coad type data flow diagrams are usually used for system analysis
and design, while Gane and Sarson type DFDs are more common for visualizing
information systems.
Visually, the biggest difference between the two ways of drawing data flow
diagrams is how processes look. In the Yourdon and Coad way, processes are
depicted as circles, while in the Gane and Sarson diagram the processes are
squares with rounded corners.

There are four meaningful objects that appear on data flow diagrams:

Process: A process signifies that something is happening to transform data. At

the highest level, you could show the entire system as one process. Eg: Library
management system, book store system, Banking system, order processing
system etc. This is called high level or Context Diagram.
After creating the context (or high-level) diagram, you then break the process
into subprocesses.
Data Store: A data store is a place where data is kept while it is not actively
being processed. Your process model does not show how it is stored, whether
encoded on magnetic disk or scribbled on the back of an envelope, just that it is
stored. Data can only enter a data store from a process and can only leave a
data store to a process
External Entity: An external entity is something outside the boundary of the
system you are modelling that either sends data to your system or receives data
from it. It is effectively a black box, in that what happens inside the external
entity is not material to your system description. It is only there to make clear
some of the environment in which your system resides.
Data Flow: A data flow depicts the movement of one to many items of data.
Data can enter a system from outside, such as the entries that appear on a
publishers invoice or a packing list, in book store system.

Context diagram
The Context Diagram is used to establish the context and boundaries of the
system to be modelled i.e. which things are inside and outside of the system
being modelled, and what is the relationship of the system with these external
A Context Diagram, sometimes called a Level 0 Data Flow Diagram, is drawn in
order to define and clarify the boundaries of the investigation. It identifies the
flows of information between the system and external entities. The entire system
of interest is shown as a single process.
Example of a context level diagram: Banking system

The benefits of Data Flow Diagrams

Data Flow Diagrams provide a very important tool for systems analysis, for a
number of reasons:

The model provides a pictorial but non-technical representation of the

system, thereby providing the basis for good communication between
analysts and users. It is easy to draw and update as well as being easy to
The diagrams impose structure on the information, providing a clear and
concise visual representation that makes the information and its
interrelationships easier to understand.
The system scope and boundaries are clearly indicated on the diagrams
The rules by which diagrams are constructed assist in highlighting areas
where analysis may be incomplete.
The technique of decomposition of high level Data Flow Diagrams to a set
of more detailed diagrams, provides an overall view of the complete
system, as well as a more detailed breakdown and description of individual
activities where this is appropriate for clarification and understanding

Practice questions:
For the following situation, draw a context-level diagram
Kellogg State Bank provides car and home loans to its banking customers.
Initially, a potential loan customer meets with a Kellogg loan officer, requests a
loan for a certain amount and time frame, and completes a loan application.
Next, the loan officer determines the customers credit standing, the type of loan
required, and available interest rates. While the loan officer can authorize car
loans for credit worthy customers, a loan committee must approve all home
Exercise #2:
Video-Rental LTD case study
Video-Rental LTD is a small video rental store. The store lends videos to
customers for a fee, and purchases its videos from a local supplier.
A customer wishing to borrow a video provides the empty box of the video they
desire, their membership card, and payment payment is always with the credit
card used to open the customer account. The customer then returns the video to
the store after watching it.
If a loaned video is overdue by a day the customers credit card is charged, and a
reminder letter is sent to them. Each day after that a further chard is made, and
each week a reminder letter is sent. This continues until either the customer
returns the video, or the charges are equal to the cost of replacing the video.
New customers fill out a form with their personal details and credit card details,
and the counter staff give the new customer a membership card. Each new
customers form is added to the customer file.

The local video supplier sends a list of available titles to Video-Rental LTD, who
decide whether to send them an order and payment. If an order is sent then the
supplier sends the requested videos to the store. For each new video a new stock
form is completed and placed in the stock file.
What are the external entities in the following diagram Video-Rental LTD case

What are the data flows between Supplier and Video-Rental LTD case study in the
above diagram?
What are the processes in the above diagram Video-Rental LTD case study?
Clients wishing to put their property on the market visit the estate agent, who
will take details of their house, flat or bungalow and enter them on a card which
is filed according to the area, price range and type of property .
Potential buyers complete a similar type of card which is filed by buyer name in
an A4 binder. Data Flow Diagrams 12 Weekly, the estate agent matches the
potential buyer requirements with the available properties and sends them the
details of selected properties.
When a sale is completed, the buyer confirms that the contracts have been
exchanged, client details are removed from the property file, and an invoice is
sent to the client. The client receives the top copy of a three part set, with the
other two copies being filed.
On receipt of the payment the invoice copies are stamped and archived. Invoices
are checked on a monthly basis and for those accounts not settled within two
months a reminder (the third copy of the invoice) is sent to the client.
Create a context diagram for this Estate Agency case study

Create a context diagram for this Estate Agency case study