Strategic Management - An Introduction

Strategic Management is all about identification and description of the

strategies that managers can carry so as to achieve better
performance and a competitive advantage for their organization.

STRATEGIES TO ACHIEVE

BETTER PERFORM AND

COMPETITIVE ADVANTAGE IF PROFIT IS HIGH

An organization is said to have competitive advantage if its

profitability is higher than the average profitability for all companies
in its industry.

Strategic management can also be defined as a bundle of decisions

and acts which a manager undertakes and which decides the result of
the firm’s performance.

The manager must have a thorough knowledge and analysis of the

general and competitive organizational environment so as to take right
decisions. They should conduct a SWOT Analysis (Strengths,
Weaknesses, Opportunities, and Threats), i.e., they should make best
possible utilization of strengths, minimize the organizational
weaknesses, make use of arising opportunities from the business
environment and shouldn’t ignore the threats. Strategic management
is nothing but planning for both predictable as well as unfeasible
contingencies.
It is applicable to both small as well as large organizations as even
the smallest organization face competition and, by formulating and
implementing appropriate strategies, they can attain sustainable
competitive advantage.

Strategic Management is a way in which strategists set the

objectives and proceed about attaining them. It deals with making
and implementing decisions about future direction of an organization.
It helps us to identify the direction in which an organization is
moving.
Strategic management is a continuous process that evaluates and
controls the business and the industries in which an organization is
involved; evaluates its competitors and sets goals and strategies to
meet all existing and potential competitors; and then re-evaluates
strategies on a regular basis to determine how it has been
implemented and whether it was successful or does it needs
replacement.

Strategic Management gives a broader perspective to the employees

of an organization and they can better understand how their job fits
into the entire organizational plan and how it is co-related to other
organizational members.

It is nothing but the art of managing employees in a manner which

maximizes the ability of achieving business objectives.

The employees become more trustworthy, more committed and more

satisfied as they can co-relate themselves very well with each
organizational task. They can understand the reaction of
environmental changes on the organization and the probable response
of the organization with the help of strategic management. Thus the
employees can judge the impact of such changes on their own job and
can effectively face the changes. The managers and employees must
do appropriate things in appropriate manner. They need to be both
effective as well as efficient.

One of the major role of strategic management is to incorporate

various functional areas of the organization completely, as well as, to
ensure these functional areas harmonize and get together well.

Another role of strategic management is to keep a continuous eye on

the goals and objectives of the organization.

Following are the important concepts of Strategic Management:

Strategy - Definition and Features

Components of a Strategy Statement
Strategic Management Process
Environmental Scanning
 Strategy Formulation
Strategy Implementation
Strategy Formulation vs Implementation
Strategy Evaluation
Strategic Decisions
Business Policy
BCG Matrix
SWOT Analysis
Competitor Analysis
Porter’s Five Forces Model
Strategic Leadership
Corporate Governance
Business Ethics
Core Competencies

Defining Strategic Management

Strategic management consists of the analysis, decisions, and actions
an organization undertakes in order to create and sustain competitive
advantages. This definition captures two main elements
that go to the heart of the field of strategic management.

(1) First, the strategic management of an organization entails three

ongoing processes: analysis, decisions, and actions. That is,
strategic management is concerned with the

analysis of strategic goals (vision, mission, and strategic objectives)

along with the analysis of the internal and external environment of the
organization.

Next, leaders must make strategic decisions. These decisions,

broadly speaking, address two basic questions: What industries should
we compete in? How should we compete in those industries? These
questions also often involve an organization’s domestic as well as its
international operations.

And last are the actions that must be taken. Decisions are of little use,
of course, unless they are acted on. Firms must take the necessary
actions to implement their strategies. This requires leaders to allocate
the necessary resources and to design the organization to bring the
intended strategies to reality. As we will see in the next section, this is
an ongoing, evolving process that requires a great deal of interaction
among these three processes.

(2) Second, the essence of strategic management is the study of why

some firms outperform others. Thus, managers need to determine how
a firm is to compete so that it can obtain advantages that are
sustainable over a lengthy period of time. That means focusing on two
fundamental questions: How should we compete in order to create
competitive advantages in the marketplace?
For example, managers need to determine if the firm should position
itself as the low-cost producer, or develop products and services that
are unique which will enable the firm to charge premium prices-or
some combination of both.
 Managers must also ask how to make such advantages sustainable,
instead of highly temporary, in the marketplace. That is: How can we
create competitive advantages in the marketplace that are not only
unique and valuable but also difficult for competitors to copy or
substitute?

Ideas that work are almost always copied by rivals immediately. In the
1980s, American Airlines tried to establish a competitive advantage
by introducing the frequent flyer program. Within
weeks, all the airlines did the same thing. Overnight, instead of
competitive advantage, frequent flyer programs became a necessary
tool for competitive parity, not competitive advantage. The
challenge, therefore, is to create competitive advantage that is
sustainable.

Michael Porter argues that sustainable competitive advantage cannot

be achieved through operational effectiveness alone. Most of the
popular management innovations of the last two decades-total quality,
just-in-time, benchmarking, business process reengineering,
tsourcingall are about operational effectiveness. Operational
effectiveness means performing similar activities better than rivals.
Each of these is important, but none lead to sustainable competitive
advantage, for the simple reason that everyone is doing them. Strategy
is all about being different from everyone else. Sustainable
competitive advantage is possible only through performing
different activities from rivals or performing similar activities in
different ways.

Companies such as Wal-Mart, Southwest Airlines, and IKEA have

developed unique, internally consistent, and difficult to imitate
activity systems that have provided them with sustained competitive
advantage. A company with a good strategy must make clear choices
about what it wants to accomplish. Trying to do everything that your
rivals do eventually leads to mutually destructive
price competition, not long-term advantage.
1. Images for michael porter's five forces model
Porter five forces analysis
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This article relies on references to primary sources or sources affiliated with the
subject. Please add citations from reliable and independent sources. (October 2009)

A graphical representation of Porter's Five Forces

Porter's five forces analysis is a framework for industry analysis and business strategy
development formed by Michael E. Porter of Harvard Business School in 1979. It draws upon
industrial organization (IO) economics to derive five forces that determine the competitive
intensity and therefore attractiveness of a market. Attractiveness in this context refers to the
overall industry profitability. An "unattractive" industry is one in which the combination of
these five forces acts to drive down overall profitability. A very unattractive industry would
be one approaching "pure competition", in which available profits for all firms are driven to
normal profit.

Three of Porter's five forces refer to competition from external sources. The remainder are
internal threats.

Porter referred to these forces as the micro environment, to contrast it with the more general
term macro environment. They consist of those forces close to a company that affect its
ability to serve its customers and make a profit. A change in any of the forces normally
requires a business unit to re-assess the marketplace given the overall change in industry
information. The overall industry attractiveness does not imply that every firm in the industry
will return the same profitability. Firms are able to apply their core competencies, business
model or network to achieve a profit above the industry average. A clear example of this is
the airline industry. As an industry, profitability is low and yet individual companies, by
applying unique business models, have been able to make a return in excess of the industry
average.

Porter's five forces include - three forces from 'horizontal' competition: threat of substitute
products, the threat of established rivals, and the threat of new entrants; and two forces from
'vertical' competition: the bargaining power of suppliers and the bargaining power of
customers.

This five forces analysis, is just one part of the complete Porter strategic models. The other
elements are the value chain and the generic strategies.[citation needed]
Porter developed his Five Forces analysis in reaction to the then-popular SWOT analysis,
which he found unrigorous and ad hoc.[1] Porter's five forces is based on the Structure-
Conduct-Performance paradigm in industrial organizational economics. It has been applied to
a diverse range of problems, from helping businesses become more profitable to helping
governments stabilize industries.[2]

Contents
[hide]
 1 Five forces
o 1.1 Threat of new competition
o 1.2 Threat of substitute products or services
o 1.3 Bargaining power of customers (buyers)
o 1.4 Bargaining power of suppliers
o 1.5 Intensity of competitive rivalry
 2 Usage
 3 Criticisms
 4 See also
 5 References
 6 Further reading

 7 External links

[edit] Five forces

[edit] Threat of new competition

Profitable markets that yield high returns will attract new firms. This results in many new
entrants, which eventually will decrease profitability for all firms in the industry. Unless the
entry of new firms can be blocked by incumbents, the abnormal profit rate will tend towards
zero (perfect competition).

 The existence of barriers to entry (patents, rights, etc.) The most attractive segment is
one in which entry barriers are high and exit barriers are low. Few new firms can enter
and non-performing firms can exit easily.
 Economies of product differences
 Brand equity
 Switching costs or sunk costs
 Capital requirements
 Access to distribution
 Customer loyalty to established brands
 Absolute cost
 Industry profitability; the more profitable the industry the more attractive it will be to
new competitors.

[edit] Threat of substitute products or services

The existence of products outside of the realm of the common product boundaries increases
the propensity of customers to switch to alternatives. Note that this should not be confused
with competitors' similar products but entirely different ones instead. For example, tap water
might be considered a substitute for Coke, whereas Pepsi is a competitor's similar product.
Increased marketing for drinking tap water might "shrink the pie" for both Coke and Pepsi,
whereas increased Pepsi advertising would likely "grow the pie" (increase consumption of all
soft drinks), albeit while giving Pepsi a larger slice at Coke's expense.

 Buyer propensity to substitute

 Relative price performance of substitute
 Buyer switching costs
 Perceived level of product differentiation
 Number of substitute products available in the market
 Ease of substitution. Information-based products are more prone to substitution, as
online product can easily replace material product.
 Substandard product
 Quality depreciation

[edit] Bargaining power of customers (buyers)

The bargaining power of customers is also described as the market of outputs: the ability of
customers to put the firm under pressure, which also affects the customer's sensitivity to price
changes.

 Buyer concentration to firm concentration ratio

 Degree of dependency upon existing channels of distribution
 Bargaining leverage, particularly in industries with high fixed costs
 Buyer switching costs relative to firm switching costs
 Buyer information availability

 Availability of existing substitute products

 Buyer price sensitivity
 Differential advantage (uniqueness) of industry products
 RFM Analysis

[edit] Bargaining power of suppliers

The bargaining power of suppliers is also described as the market of inputs. Suppliers of raw
materials, components, labor, and services (such as expertise) to the firm can be a source of
power over the firm, when there are few substitutes. Suppliers may refuse to work with the
firm, or, e.g., charge excessively high prices for unique resources.

 Supplier switching costs relative to firm switching costs

 Degree of differentiation of inputs
 Impact of inputs on cost or differentiation
 Presence of substitute inputs
 Strength of distribution channel
 Supplier concentration to firm concentration ratio
 Employee solidarity (e.g. labor unions)
 Supplier competition - ability to forward vertically integrate and cut out the BUYER

Ex.: If you are making biscuits and there is only one person who sells flour, you have no
alternative but to buy it from him.
[edit] Intensity of competitive rivalry

For most industries, the intensity of competitive rivalry is the major determinant of the
competitiveness of the industry.

 Sustainable competitive advantage through innovation

 Competition between online and offline companies
 Level of advertising expense
 Powerful competitive strategy

[edit] Usage

Strategy consultants occasionally use Porter's five forces framework when making a
qualitative evaluation of a firm's strategic position. However, for most consultants, the
framework is only a starting point or "checklist." They might use " Value Chain" afterward.
Like all general frameworks, an analysis that uses it to the exclusion of specifics about a
particular situation is considered naїve.

According to Porter, the five forces model should be used at the line-of-business industry
level; it is not designed to be used at the industry group or industry sector level. An industry
is defined at a lower, more basic level: a market in which similar or closely related products
and/or services are sold to buyers. (See industry information.) A firm that competes in a
single industry should develop, at a minimum, one five forces analysis for its industry. Porter
makes clear that for diversified companies, the first fundamental issue in corporate strategy is
the selection of industries (lines of business) in which the company should compete; and each
line of business should develop its own, industry-specific, five forces analysis. The average
Global 1,000 company competes in approximately 52 industries (lines of business).

[edit] Criticisms

Porter's framework has been challenged by other academics and strategists such as Stewart
Neill. Similarly, the likes of Kevin P. Coyne [1] and Somu Subramaniam have stated that
three dubious assumptions underlie the five forces:

 That buyers, competitors, and suppliers are unrelated and do not interact and collude.
 That the source of value is structural advantage (creating barriers to entry).
 That uncertainty is low, allowing participants in a market to plan for and respond to
competitive behavior.[3]

An important extension to Porter was found in the work of Adam Brandenburger and Barry
Nalebuff in the mid-1990s. Using game theory, they added the concept of complementors
(also called "the 6th force"), helping to explain the reasoning behind strategic alliances. The
idea that complementors are the sixth force has often been credited to Andrew Grove, former
CEO of Intel Corporation. According to most references, the sixth force is government or the
public. Martyn Richard Jones, whilst consulting at Groupe Bull, developed an augmented 5
forces model in Scotland in 1993. It is based on Porter's model and includes Government
(national and regional) as well as Pressure Groups as the notional 6th force. This model was
the result of work carried out as part of Groupe Bull's Knowledge Asset Management
Organisation initiative.
Porter indirectly rebutted the assertions of other forces, by referring to innovation,
government, and complementary products and services as "factors" that affect the five forces.
[4]

It is also perhaps not feasible to evaluate the attractiveness of an industry independent of the
resources a firm brings to that industry. It is thus argued[citation needed] that this theory be coupled
with the Resource-Based View (RBV) in order for the firm to develop a much more sound
strategy. It provides a simple perspective for accessing and analyzing the competitive strength
and position of a corporation, business or organization.

***************
Five Forces model of Michael Porter is a very elaborate concept for evaluating company's
competitive position. Michael Porter provided a framework that models an industry and
therefore implicitly also businesses as being influenced by five forces. Michael Porter's Five
Forces model is often used in strategic planning.

Porter's competitive five forces model is probably one of the most commonly used business
strategy tools and has proven its usefulness in numerous situations. When exploring
strategic management models, you also might want to check out the BCG matrix, SWOT
analysis, IFE matrix, and SPACE matrix models.

Why would I need to use Porter's Five Forces model?

In general, any CEO or a strategic business manager is trying to steer his or her business in a
direction where the business will develop an edge over rival firms. Michael Porter's model of
Five Forces can be used to better understand the industry context in which the firm
operates. Porter's Five Forces model is a strategy tool that is used to analyze attractiveness
of an industry structure.

What is good about Porter's Five Forces model?

Porter has the ability to represent complex concepts in relatively easily accessible formats.
His book about the Five Forces model is written in a very easy and understandable
language. Even though his model is backed up by some complex model, the model itself is
simple and easily comprehensible at all levels.

Porter's Five Forces model provides suggested points under each main heading, by which
you can develop a broad and sophisticated analysis of competitive position. This can be
then used when creating strategy, plans, or making investment decisions about your
business or organization.

Does Porter's Five Forces model really work?

Theoreticians have different view on this. While some agree that Porter's Five Forces model
is the ultimate explanation of how world works, others disagree. It depends in what time
frame we judge the state of the facts. Even Michael Porter himself acknowledges that time
is of essence when it comes to how his forces interact with each other.
Numerous economic studies have shown that different industries can sustain different
levels of profitability. This can be attributed to differences in industry structures.

What is the basic idea behind Porter's Five Forces model?

Porter's Five Forces model is made up by identification of 5 fundamental competitive

forces:

 Barriers to entry
 Threat of substitutes
 Bargaining power of buyers
 Bargaining power of suppliers
 Rivalry among the existing players

Some later economists also consider government as the sixth force in this model.

When putting all these points together in a graphical representation, we get Porter's Five
Forces model which looks like this:
Force 1: Barriers to entry

Barriers to entry measure how easy or difficult it is for new entrants to enter into the
industry. This can involve for example:

 Cost advantages (economies of scale, economies of scope)

 Access to production inputs and financing,
 Government policies and taxation
 Production cycle and learning curve
 Capital requirements
 Access to distribution channels

Patents, branding, and image also fall into this category.

Force 2: Threat of substitutes

Every top decision makes has to ask: How easy can our product or service be substituted? The
following needs to be analyzed:

 How much does it cost the customer to switch to competing products or services?
 How likely are customers to switch?
 What is the price-performance trade-off of substitutes?

If a product can be easily substituted, then it is a threat to the company because it can
compete with price only.

Force 3: Bargaining power of buyers

Now the question is how strong the position of buyers is. For example, can your
customers work together to order large volumes to squeeze your profit margins? The
following is a list of other examples:

 Buyer volume and concentration

 What information buyers have
 Can buyers corner you in negotiations about price
 How loyal are customers to your brand
 Price sensitivity
 Threat of backward integration
 How well differentiated your product is
 Availability of substitutes

Having a customer that has the leverage to dictate your prices is not a good position.

Force 4: Bargaining power of suppliers

This relates to what your suppliers can do in relationship with you.

 How strong is the position of sellers?

 Are there many or only few potential suppliers?
 Is there a monopoly?
 Do you take inputs from a single supplier or from a group? (concentration)
 How much do you take from each of your suppliers?
 Can you easily switch from one supplier to another one? (switching costs)
 If you switch to another supplier, will it affect the cost and differentiation of your
product?
 Are there other suppliers with the same inputs available? (substitute inputs)

The threat of forward integration is also an important factor here.

Force 5: Rivalry among the existing players

Finally, we have to analyze the level of competition between existing players in the
industry.

 Is one player very dominant or all equal in strength/size?

 Are there exit barriers?
 How fast does the industry grow?
 Does the industry operate at surplus or shortage?
 How is the industry concentrated?
 How do customers identify themselves with your brand?
 Is the product differentiated?
 How well are rivals diversified?

Rivalry is the fifth factor in the Five Forces model but probably the one with the most
attention.

What are the assumptions behind the Five Forces model?

From the risk-return perspective, Five Forces model indirectly implies that risk-adjusted
rates of return should be constant across firms and industries.

How can I analyze my business from inside?

Porter's Five Forces model views the business from outside. It focuses on assessing
competitive position within industry. If you wanted to analyze your firm from within, you
might want to consider the SWOT model. The SWOT model has some aspects of external
view as well but complements Porter's Five Forces model in the internal view. Another
model that you might want to consider is the Balanced Scorecard and IFE/EFE matrix.
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Life
Supercession is by definition the act of a media class to include, further classify, or
incorporate into a more comprehensible form of media before the inclusion took place. A
better definition by Gitelman and Pingree states that supercerssion is "the notion that each
new medium "vanquishes or subsumes its predecessors."

supercession is normally an opinionatedly driven concept by several factors. Its progress

represented by its ability to deliver the medium in some way better than its predecessor. the
delivery can be judged in many ways including, but not limited to; ease of use, definition of
delivery, portability, medium, size and how well it conforms to human interaction. all of these
terms could represent a factor by which humans would judge something has superseded its
predecessor. the amount of change needed to say something has superseded, is again based
upon opinions. But generally as a certain factor is refined over time the amount of change
needed to say that factor has made something supersede itself will also increase with the time
span of time. an example could be the computer mouse, once a box with a single button now
has multiple buttons and sensors, which led to the track pad on a laptop, which was a
dramatic change, but like the mouse from single button to a touch pad, the next generation
will have to be more dramatic in change due to the refinement of the idea.

Noun1.supersession - act of replacing one person or thing by another especially one held to
be superior
What is credit creation by commercial bank?
gives me the formula of credit creation

Best Answer - Chosen by Voters

One of the important functions of commercial bank is the creation of credit.

Credit creation is the multiple expansions of banks demand deposits.
It is an open secret now that banks advance a major portion of their deposits to the borrowers
and keep smaller parts of deposits to the customers on demand. Even then the customers of
the banks have full confidence that the depositor’s lying in the banks are quite safe and can be
withdrawn on demand. The banks exploit this trust of their clients and expand loans by much
more time than the amount of demand deposits possessed by them. This tendency on the
part of the commercial banks to expand their demand deposits as a multiple of their
excess cash reserve is called creation of credit.

The single bank cannot create credit. It is the banking system as a whole which can expand
loans by many times of its excess cash reserves. Further, when a loan is advanced to an
individuals or a business concern, it is not given in cash. The bank opens a deposit account in
the name of the borrower and allows him to draw upon the bank as and when required. The
loan advanced becomes the gain of deposit by some other bank. Loans thus make deposits
and deposits make loans.

The most common mechanism used to measure this increase in the money supply is typically
called the money multiplier. It calculates the maximum amount of money that an initial
deposit can be expanded to with a given reserve ratio.

Formula

The money multiplier, m, is the inverse of the reserve requirement, R

m=1/R

Example

For example, with the reserve ratio of 20 percent, this reserve ratio, R, can also be expressed
as a fraction:

R=1/5

So then the money multiplier, m, will be calculated as:

m=1/(1/5)=5
This number is multiplied by the initial deposit to show the maximum amount of money it
can be expanded to.
What is credit creation by commercial bank?
gives me the formula of credit creation

Best Answer - Chosen by Voters

One of the important functions of commercial bank is the creation of credit.

Credit creation is the multiple expansions of banks demand deposits.
It is an open secret now that banks advance a major portion of their deposits to the borrowers
and keep smaller parts of deposits to the customers on demand. Even then the customers of
the banks have full confidence that the depositor’s lying in the banks are quite safe and can be
withdrawn on demand. The banks exploit this trust of their clients and expand loans by much
more time than the amount of demand deposits possessed by them. This tendency on the
part of the commercial banks to expand their demand deposits as a multiple of their
excess cash reserve is called creation of credit.

The single bank cannot create credit. It is the banking system as a whole which can expand
loans by many times of its excess cash reserves. Further, when a loan is advanced to an
individuals or a business concern, it is not given in cash. The bank opens a deposit account in
the name of the borrower and allows him to draw upon the bank as and when required. The
loan advanced becomes the gain of deposit by some other bank. Loans thus make deposits
and deposits make loans.

The most common mechanism used to measure this increase in the money supply is typically
called the money multiplier. It calculates the maximum amount of money that an initial
deposit can be expanded to with a given reserve ratio.

Formula

The money multiplier, m, is the inverse of the reserve requirement, R

m=1/R

Example

For example, with the reserve ratio of 20 percent, this reserve ratio, R, can also be expressed
as a fraction:

R=1/5

So then the money multiplier, m, will be calculated as:

m=1/(1/5)=5

This number is multiplied by the initial deposit to show the maximum amount of money it
can be expanded to.
Information College of Business University of Missouri - St.
Systems Administration Louis

Entity-Relationship Diagrams (ERD)

Data models are tools used in analysis to describe the data
requirements and assumptions in the system from a top-down
perspective. They also set the stage for the design of
databases later on in the SDLC.
There are three basic elements in ER models:
Entities are the "things" about which we seek information.
Attributes are the data we collect about the entities.
Relationships provide the structure needed to draw
information from multiple entities.

Generally, ERD's look like this:

adapted from another professor.

Developing an ERD

Developing an ERD requires an understanding of the system and its

components. Before discussing the procedure, let's look at a narrative
created by Professor Harman.
Consider a hospital:
Patients are treated in a single ward by the doctors assigned to
them. Usually each patient will be assigned a single doctor,
but in rare cases they will have two.
Heathcare assistants also attend to the patients, a number of
these are associated with each ward.
Initially the system will be concerned solely with drug
treatment. Each patient is required to take a variety of drugs a
certain number of times per day and for varying lengths of
time.
The system must record details concerning patient treatment
and staff payment. Some staff are paid part time and doctors
and care assistants work varying amounts of overtime at
varying rates (subject to grade).
The system will also need to track what treatments are
required for which patients and when and it should be
capable of calculating the cost of treatment per week for each
patient (though it is currently unclear to what use this
information will be put).

How do we start an ERD?

1. Define Entities: these are usually nouns used in descriptions of the

system, in the discussion of business rules, or in documentation;
identified in the narrative (see highlighted items above).

2. Define Relationships: these are usually verbs used in descriptions of

the system or in discussion of the business rules (entity ______ entity);
identified in the narrative (see highlighted items above).
3. Add attributes to the relations; these are determined by the
queries,and may also suggest new entities, e.g. grade; or they
may suggest the need for keys or identifiers.
What questions can we ask?
a. Which doctors work in which wards?
b. How much will be spent in a ward in a given week?
c. How much will a patient cost to treat?
d. How much does a doctor cost per week?
e. Which assistants can a patient expect to see?
f. Which drugs are being used?
4. Add cardinality to the relations
Many-to-Many must be resolved to two one-to-manys with an
additional entity
Usually automatically happens
Sometimes involves introduction of a link entity (which will be
all foreign key) Examples: Patient-Drug
5. This flexibility allows us to consider a variety of questions
such as:
a. Which beds are free?
b. Which assistants work for Dr. X?
c. What is the least expensive prescription?
d. How many doctors are there in the hospital?
e. Which patients are family related?

6. Represent that information with symbols. Generally E-R Diagrams

require the use of the following symbols:
Reading an ERD

It takes some practice reading an ERD, but they can be used with clients
to discuss business rules.

These allow us to represent the information from above such as the E-R
Diagram below:
ERD brings out issues:
Many-to-Manys
Ambiguities
Entities and their relationships
What data needs to be stored
The Degree of a relationship

Now, think about a university in terms of an ERD. What entities,

relationships and attributes might you consider? Look at this simplified
view. There is also an example of a simplified view of an airline on that
page.
 You can investigate more about ERDs by viewing these
sources available on the Internet:
E-R Diagrams, Tables and their Meaning
Entity-Relationship Diagrams
Entity-Relationship Diagrams
Entity-Relationship Diagrams
4.1 Lecture: Entity Relationship Analysis
Five Entities related to Agent
Crosswalk Exercise - ALMRS Customer with the Standard
Guidelines
Domain Analysis
ERDIAG

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Relationship Models
Michael Emmerich
Leiden Institute for Advanced Computer Science, Leiden
University
January 31, 2012
Michael T. M. Emmerich Databases

Introduction/Overview
Introduction/Overview
E-R Diagrams - Basics
Simple Constraints
Advanced Concepts
Guidelines
Michael T. M. Emmerich Databases

Architecture of an DBMS
Introduction/Overview
Michael T. M. Emmerich Databases
Introduction/Overview
E-R Diagrams - Basics
Simple Constraints
Advanced Concepts
Guidelines
 I
Many views, single
conceptual (logical)
schema and physical
schema
I Views describe how users
see the data, e.g.
teachers, students
I Conceptual schema
de_nes logical structure,
e.g. table structure
I Physical schema describes
the _les and indexes used
Michael T. M. Emmerich Databases
Table of contents