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 Chapter

5
Data Resource Management

McGraw-Hill/Irwin Copyright © 2008, The McGraw-Hill Companies, Inc. All rights reserved.
 Learning Objectives

• Explain the business value of implementing

data resource management processes and
technologies in an organization
• Outline the advantages of a database
management approach to managing the data
resources of a business, compared to a file
processing approach
• Explain how database management software
helps business professionals and supports the
operations and management of a business
5-3
 Learning Objectives

• Provide examples to illustrate the following

concepts
• Major types of databases
• Data warehouses and data mining
• Logical data elements
• Fundamental database structures
• Database development

5-4
 Case 1: Sharing Business Databases

• Amazon’s data vault

• Product descriptions
• Prices
• Sales rankings
• Customer reviews
• Inventory figures
• Countless other layers of content
• Took 10 years and a billion dollars to build

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 Case 1: Sharing Business Databases

• Amazon opened its data vault in 2002

• 65,000 developers, businesses, and entrepreneurs
have tapped into it
• Many have become ambitious business partners
• eBay opened its $3 billion databases in 2003
• 15,000 developers and others have registered
to use it and to access software features
• 1,000 new applications have appeared
• 41 percent of eBay’s listings are uploaded to
the site using these resources

5-6
 Case 1: Sharing Business Databases

• Google recently unlocked access to its desktop

and paid-search products
• Dozens of Google-driven services cropped up
• Developers can grab 1,000 search results a day
for free; anything more requires permission
• In 2005, the Ad-Words paid-search service
was opened to outside applications

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 Case Study Questions

• What are the business benefits to Amazon and

eBay of opening up some of their databases to
developers and entrepreneurs?
• Do you agree with this strategy?
• What business factors are causing Google to
move slowly in opening up its databases?
• Do you agree with its go-slow strategy?

5-8
 Case Study Questions

• Should other companies follow Amazon and

eBay’s lead and open up some of their databases
to developers and others?
• Defend your position with an example of the risks
and benefits to an actual company

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Logical Data Elements

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 Logical Data Elements

• Character
• A single alphabetic, numeric, or other symbol
• Field or data item
• Represents an attribute (characteristic or quality)
of some entity (object, person, place, event)
• Examples: salary, job title

• Record
• Grouping of all the fields used to describe the
attributes of an entity
• Example: payroll record with name, SSN, pay rate

5-11
 Logical Data Elements

• File or table
• A group of related records
• Database
• An integrated collection of logically related
data elements

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Electric Utility Database

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 Database Structures

• Common database structures…

• Hierarchical
• Network
• Relational
• Object-oriented
• Multi-dimensional

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 Hierarchical Structure

• Early DBMS structure

• Records arranged in tree-like structure
• Relationships are one-to-many

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 Network Structure

• Used in some mainframe DBMS packages

• Many-to-many relationships

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 Relational Structure

• Most widely used structure

• Data elements are stored in tables
• Row represents a record; column is a field
• Can relate data in one file with data in another,
if both files share a common data element
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 Relational Operations

• Select
• Create a subset of records that meet a stated
criterion
• Example: employees earning more than $30,000

• Join
• Combine two or more tables temporarily
• Looks like one big table
• Project
• Create a subset of columns in a table

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 Multidimensional Structure

• Variation of relational model

• Uses multidimensional structures to
organize data
• Data elements are viewed as being in cubes
• Popular for analytical databases that support
Online Analytical Processing (OLAP)

5-19
Multidimensional Model

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 Object-Oriented Structure

• An object consists of
• Data values describing the attributes of an entity
• Operations that can be performed on the data
• Encapsulation
• Combine data and operations
• Inheritance
• New objects can be created by replicating some
or all of the characteristics of parent objects

5-21
 Object-Oriented Structure

Source: Adapted from Ivar Jacobsen, Maria Ericsson, and Ageneta Jacobsen, The Object Advantage: Business Process
Reengineering with Object Technology (New York: ACM Press, 1995), p. 65.
Copyright @ 1995, Association for Computing Machinery. By permission.

5-22
 Object-Oriented Structure

• Used in object-oriented database management

systems (OODBMS)
• Supports complex data types more efficiently
than relational databases
• Examples: graphic images, video clips,
web pages

5-23
 Evaluation of Database Structures

• Hierarchical
• Works for structured, routine transactions
• Can’t handle many-to-many relationship
• Network
• More flexible than hierarchical
• Unable to handle ad hoc requests
• Relational
• Easily responds to ad hoc requests
• Easier to work with and maintain
• Not as efficient/quick as hierarchical or network
5-24
 Database Development

• Database Administrator (DBA)

• In charge of enterprise database development
• Improves the integrity and security of
organizational databases
• Uses Data Definition Language (DDL) to develop
and specify data contents, relationships, and
structure
• Stores these specifications in a data dictionary
or a metadata repository

5-25
 Data Dictionary

• A data dictionary
• Contains data about data (metadata)
• Relies on specialized software component to
manage a database of data definitions
• It contains information on..
• The names and descriptions of all types of data
records and their interrelationships
• Requirements for end users’ access and use of
application programs
• Database maintenance
• Security
5-26
Database Development

5-27
 Data Planning Process

• Database development is a top-down process

• Develop an enterprise model that defines the
basic business process of the enterprise
• Define the information needs of end users in
a business process
• Identify the key data elements that are needed
to perform specific business activities
(entity relationship diagrams)

5-28
Entity Relationship Diagram

5-29
 Database Design Process

• Data relationships are represented in a data

model that supports a business process
• This model is the schema or subschema on
which to base…
• The physical design of the database
• The development of application programs to
support business processes

5-30
 Database Design Process

• Logical Design
• Schema - overall logical view of relationships
• Subschema - logical view for specific end users
• Data models for DBMS
• Physical Design
• How data are to be physically stored and
accessed on storage devices

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Logical and Physical Database Views

5-32
 Data Resource Management

• Data resource management is a managerial

activity
• Uses data management, data warehousing,
and other IS technologies
• Manages data resources to meet the information
needs of business stakeholders

5-33
Case 2: Emerson & Sanofi, Data Stewards

• Data stewards
• Dedicated to establishing and maintaining the
quality of data
• Need business, technology, and diplomatic skills
• Focus on data content

• Judgment is a big part of the job

5-34
 Case Study Questions

• Why is the role of a data steward considered to

be innovative?
• What are the business benefits associated with
the data steward program at Emerson?
• How does effective data resource management
contribute to the strategic goals of an
organization?

5-35
Types of Databases

5-36
 Operational Databases

• Stores detailed data needed to support business

processes and operations
• Also called subject area databases (SADB),
transaction databases, and production
databases
• Database examples: customer, human resource,
inventory

5-37
 Distributed Databases

• Distributed databases are copies or parts of

databases stored on servers at multiple locations
• Improves database performance at worksites
• Advantages
• Protection of valuable data
• Data can be distributed into smaller databases
• Each location has control of its local data
• All locations can access any data, any where
• Disadvantages
• Maintaining data accuracy

5-38
 Distributed Databases

• Replication
• Look at each distributed database and find
changes
• Apply changes to each distributed database
• Very complex
• Duplication
• One database is master
• Duplicate the master after hours, in all locations
• Easier to accomplish

5-39
 External Databases

• Databases available for a fee from commercial

online services, or free from the Web
• Examples: hypermedia databases, statistical
databases, bibliographic and full text databases
• Search engines like Google or Yahoo are
external databases

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 Hypermedia Databases

• A hypermedia database contains

• Hyperlinked pages of multimedia
• Interrelated hypermedia page elements,
rather than interrelated data records

5-41
Components of Web-Based System

5-42
 Data Warehouses

• Stores static data that has been extracted from

other databases in an organization
• Central source of data that has been cleaned,
transformed, and cataloged
• Data is used for data mining, analytical
processing, analysis, research, decision support

• Data warehouses may be divided into data marts

• Subsets of data that focus on specific aspects
of a company (department or business process)

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Data Warehouse Components

5-44
Applications and Data Marts

5-45
 Data Mining

• Data in data warehouses are analyzed to reveal

hidden patterns and trends
• Market-basket analysis to identify new
product bundles
• Find root cause of qualify or manufacturing
problems
• Prevent customer attrition
• Acquire new customers
• Cross-sell to existing customers
• Profile customers with more accuracy

5-46
 Traditional File Processing

• Data are organized, stored, and processed in

independent files
• Each business application designed to use
specialized data files containing specific
types of data records
• Problems
• Data redundancy
• Lack of data integration
• Data dependence (files, storage devices, software)
• Lack of data integrity or standardization

5-47
Traditional File Processing

5-48
 Database Management Approach

• The foundation of modern methods of managing

organizational data
• Consolidates data records formerly in separate
files into databases
• Data can be accessed by many different
application programs
• A database management system (DBMS) is the
software interface between users and databases

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Database Management Approach

5-50
 Database Management System

• In mainframe and server computer systems, a

software package that is used to…
• Create new databases and database applications
• Maintain the quality of the data in an
organization’s databases
• Use the databases of an organization to provide
the information needed by end users

5-51
Common DBMS Software Components

• Database definition
• Language and graphical tools to define entities,
relationships, integrity constraints, and
authorization rights
• Nonprocedural access
• Language and graphical tools to access data
without complicated coding
• Application development
• Graphical tools to develop menus, data entry
forms, and reports

5-52
Common DBMS Software Components

• Procedural language interface

• Language that combines nonprocedural access
with full capabilities of a programming language
• Transaction processing
• Control mechanism prevents interference from
simultaneous users and recovers lost data after
a failure
• Database tuning
• Tools to monitor, improve database performance

5-53
 Database Management System

• Database Development
• Defining and organizing the content,
relationships, and structure of the data needed
to build a database
• Database Application Development
• Using DBMS to create prototypes of queries,
forms, reports, Web pages
• Database Maintenance
• Using transaction processing systems and other
tools to add, delete, update, and correct data

5-54
DBMS Major Functions

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 Database Interrogation

• End users use a DBMS query feature or report

generator
• Response is video display or printed report
• No programming is required
• Query language
• Immediate response to ad hoc data requests
• Report generator
• Quickly specify a format for information you
want to present as a report

5-56
 Database Interrogation

• SQL Queries
• Structured, international standard query language
found in many DBMS packages
• Query form is SELECT…FROM…WHERE…

5-57
 Database Interrogation

• Boolean Logic
• Developed by George Boole in the mid-1800s
• Used to refine searches to specific information
• Has three logical operators: AND, OR, NOT
• Example
• Cats OR felines AND NOT dogs OR Broadway

5-58
 Database Interrogation

• Graphical and Natural Queries

• It is difficult to correctly phrase SQL and other
database language search queries
• Most DBMS packages offer easier-to-use,
point-and-click methods
• Translates queries into SQL commands
• Natural language query statements are similar
to conversational English

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Graphical Query Wizard

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 Database Maintenance

• Accomplished by transaction processing systems

and other applications, with the support of the
DBMS
• Done to reflect new business transactions and
other events
• Updating and correcting data, such as customer
addresses

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 Application Development

• Use DBMS software development tools to

develop custom application programs
• Not necessary to develop detailed data-handling
procedures using conventional programming
languages
• Can include data manipulation language (DML)
statements that call on the DBMS to perform
necessary data handling

5-62
 Case 3: Acxiom Corp. Data

• Acxiom does three things really well…

• Manages large volumes of data
• Cleans, transforms, and enhances that data
• Distills business intelligence from that data to
drive smart decisions
• Refined data is sold to customers
• Developing telemarketing lists
• Identifying prospects for credit card offers
• Screen prospective employees
• Detecting fraudulent financial transactions

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 Case 3: Acxiom Corp. Data

• Primary business activities

• Building its data library
• Selling data
• Managing other companies’ data and data centers

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 Case Study Questions

• Acxiom is in a unique type of business. How

would you describe the business of Acxiom?
• Are they a service- or product-oriented business?
• It is easy to see that Acxiom has focused on a
wide variety of data from different sources.
• How does Acxiom decide which data to collect,
and for whom?
• Acxiom’s business raises many issues related
to privacy.
• Are the data collected by Acxiom really private?

5-65
 Case 4: Protecting the Data Jewels

• Harrah’s Entertainment and other casino

companies closely guard customer data
• Both hard copy and electronic files
• Concerns
• Broader access to CRM systems
• More frequent job switching

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 Case 4: Protecting the Data Jewels

• Protection methods
• Nondisclosure, non-compete, and nonsolicitation
agreements that specify customer lists
• Trade-secret laws and legal action
• Limiting access to sensitive information
• Physical security
• Strong password protection
• Reinforcement of signed agreements during
exit interviews
• Monitoring electronic communication

5-67
 Case Study Questions

• Why have developments in IT helped to

increase the value of the data resources of
many companies?
• How have these capabilities increased the
security challenges associated with protecting
a company’s data resources?
• How can companies use IT to meet the
challenges of data resource security?

5-68