Because learning changes everything.

CHAPTER SIX

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 SECTION 6.1:
DATA, INFORMATION,
AND BUSINESS
INTELLIGENCE

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 DATA 1
• Data are everywhere in an organization.

• Employees must be able to obtain and

analyze the many different levels,
formats, and granularities of
organizational data to make decisions.

• Successfully collecting, compiling,

sorting, and analyzing data can provide
tremendous insight into how an
organization is performing.

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 DATA 2

• Levels, Formats,
and Granularities
of Data.

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 DATA TYPE: TRANSACTIONAL AND ANALYTICAL 1
• The Four Primary
Traits of the Value
of Data.

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 DATA TYPE: TRANSACTIONAL AND ANALYTICAL 2
• Transactional data – Encompasses all of the
data contained within a single business
process or unit of work, and its primary
purpose is to support the performing of daily
operational tasks.

• Analytical data – Encompasses all

organizational data, and its primary purpose
is to support the performing of managerial
analysis tasks.

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 DATA TIMELINESS
Timeliness is an aspect of data that depend
on the situation.

• Real-time data – Immediate, up-to-date

data.
• Real-time system – Provides real-time
data in response to requests.

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 DATA QUALITY 1
Business decisions are only as good as the
quality of the data used to make the
decisions.

You never want to find yourself using

technology to help you make a bad decision
faster.

• Data inconsistency – Occurs when the

same data element has different values.
• Data integrity issues – Occur when a
system produces incorrect, inconsistent,
or duplicate data.

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 DATA QUALITY 2
• Characteristics of
High-Quality
Data.

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 DATA QUALITY 3
• Low-
Quality
Data
Example.

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 UNDERSTANDING THE COSTS OF
USING LOW-QUALITY DATA 1
• The four primary sources of low-quality data include.
1. Customers intentionally enter inaccurate data to
protect their privacy
2. Different entry standards and formats
3. Operators enter abbreviated or erroneous data by
accident or to save time
4. Third party and external data contain
inconsistencies, inaccuracies, and errors

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 UNDERSTANDING THE COSTS OF
USING LOW-QUALITY DATA 2
Potential business effects resulting from
low-quality data include:

• Inability to accurately track customers.

• Difficulty identifying valuable
customers.
• Inability to identify selling
opportunities.
• Marketing to nonexistent customers.
• Difficulty tracking revenue.
• Inability to build strong customer
relationships.

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 UNDERSTANDING THE BENEFITS
OF GOOD DATA
• High-quality data can significantly
improve the chances of making a good
decision.

• Good decisions can directly impact an

organization's bottom line.

• A data steward is responsible for

ensuring data policies and procedures
are implemented across an
organization.

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 DATA GOVERNANCE
• Data governance – Refers to the overall management of
the availability, usability, integrity, and security of
company data.

• Master data management (MDM) – The practice of

gathering data and ensuring that it is uniform, accurate,
consistent, and complete, including such entities as
customers, suppliers, products, sales, employees, and other
critical entities that are commonly integrated across
organizational systems.

• Data validation – Includes the tests and evaluations used

to determine compliance with data governance polices to
ensure correctness of data.

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 STORING DATA IN A RELATIONAL DATABASE 1
Data are everywhere in an organization.

Data is stored in databases.

• Database – maintains data about

various types of objects (inventory),
events (transactions), people
(employees), and places
(warehouses).

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 STORING DATA IN A RELATIONAL DATABASE 2
• Database management systems (DBMS) – Allows users to create, read,
update, and delete data in a relational database.

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 STORING DATA IN A RELATIONAL DATABASE 3
• Data element – The smallest or basic
unit of data.

• Data model – Logical data structures

that detail the relationships among data
elements using graphics or pictures.

• Metadata – Details about data.

• Data dictionary – Compiles all of the

metadata about the data elements in the
data model.

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 STORING DATA ELEMENTS IN
ENTITIES AND ATTRIBUTES
Entity – A person, place, thing, transaction, or event
about which data are stored.
• The rows in a table contain entities.

Attribute (field, column) – The data elements associated

with an entity.
• The columns in each table contain the attributes.

Record – A collection of related data elements.

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 CREATING RELATIONSHIPS
THROUGH KEYS
Primary keys and foreign keys identify the various
entities (tables) in the database.

• Primary key – A field (or group of fields) that uniquely

identifies a given entity in a table.

• Foreign key – A primary key of one table that appears an

attribute in another table and acts to provide a logical
relationship among the two tables.

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 USING A RELATIONAL DATABASE FOR
BUSINESS ADVANTAGES
• Database
Advantages
From a
Business
Perspective
Include.

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 INCREASED FLEXIBILITY
A well-designed database should
• Handle changes quickly and easily.
• Provide users with different views.
• Have only one physical view – Deals
with the physical storage of data on a
storage device.
• Have multiple logical views – Focuses
on how individual users logically
access data to meet their own
particular business needs.

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 INCREASED SCALABILITY AND
PERFORMANCE
A database must scale to meet
increased demand, while maintaining
acceptable performance levels.
• Scalability – Refers to how well a
system can adapt to increased
demands.
• Performance – Measures how
quickly a system performs a certain
process or transaction.

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 REDUCED DATA REDUNDANCY
Databases reduce data redundancy.

• Data redundancy – The duplication

of data or storing the same data in
multiple places.

Inconsistency is one of the primary

problems with redundant data.

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 INCREASE DATA – INTEGRITY (QUALITY)
Data integrity – measures the quality
of data.

Integrity constraint – rules that help

ensure the quality of data.

• Relational integrity constraint.

• Business-critical integrity
constraint.

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 INCREASED DATA SECURITY
Data are an organizational asset and
must be protected.

Databases offer several security features.

• Password – Provides authentication

of the user.
• Access level – Determines who has
access to the different types of data.
• Access control – Determines types of
user access, such as read-only access.

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 SECTION 6.2:
BUSINESS
INTELLIGENCE

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 BUSINESS INTELLIGENCE
• Organizational data are difficult to
access.

• Organizational data contain structured

data in database.

• Organizational data contain

unstructured data such as voice mail,
phone calls, text messages, and video
clips.

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 THE PROBLEM: DATA RICH,
INFORMATION POOR
• Many organizations find themselves in
the position of being data-rich and
information poor. Even in today’s
electronic world, managers struggle
with the challenge of turning their
business data into business
intelligence.

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 THE SOLUTION: DATA AGGREGATION 1
Improving the quality of business
decisions has a direct impact on costs
and revenue.
BI enables business users to receive
data for analysis that is:
• Reliable.
• Consistent.
• Understandable.
• Easily manipulated.

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 THE SOLUTION: DATA AGGREGATION 2

• BI Can Answer
Tough Questions.

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 DATA WAREHOUSE 1
• Data warehouses extend the
transformation of data into information.

• In the 1990s, executives became less

concerned with the day-to-day business
operations and more concerned with
overall business functions.

• The data warehouse provided the ability

to support decision making without
disrupting the day-to-day operations.

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 DATA WAREHOUSE 2
• Data warehouse – A logical collection
of data—gathered from many different
operational databases—that supports
business analysis activities and
decision-making tasks.

• The primary purpose of a data

warehouse is to aggregate data
throughout an organization into a
single repository for decision-making
purposes.

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 DATA WAREHOUSE 3
Reasons why business analysis is
difficult from operational systems.
• Inconsistent Data Definitions.
• Lack of Data Standards.
• Poor Data Quality.
• Inadequate Data Usefulness.
• Ineffective Direct Data Access.

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 DATA WAREHOUSE 4
• Data Aggregation – Collection of data
from various sources for the purpose of
data processing.

• Extraction, transformation, and

loading (ETL) – A process that extracts
data from internal and external
databases, transforms the data using a
common set of enterprise definitions,
and loads the data into a data
warehouse.

• Data mart – Contains a subset of data

warehouse data.

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 DATA WAREHOUSE 5

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 DATA ANALYSIS
• Data cube – The
common term for
the representation
of multidimensional
data.

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 DATA LAKE
• Data lake – A storage repository that
holds a vast amount of raw data in its
original format until the business needs
it.

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 DATA CLEANSING OR SCRUBBING 1
An organization must maintain high-
quality data in the data warehouse.
• Dirty data – Erroneous or flawed
data.
• Data cleansing or scrubbing – A
process that weeds out and fixes or
discards inconsistent, incorrect, or
incomplete data.

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 DATA CLEANSING OR SCRUBBING 2

• Dirty Data
Problems.

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 DATA CLEANSING OR SCRUBBING 6

• Cost of Accurate
and Complete data.

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 DATA VISUALIZATION 1
• Data artists use
infographics to
display patterns,
relationships, and
trends in a visual
format.

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 DATA VISUALIZATION 2
• Data visualization – Describes
technologies that allow users to “see”
or visualize data to transform data into
a business perspective.

• Data visualization tools – Move

beyond Excel graphs and charts into
sophisticated analysis techniques such
as pie charts, controls, instruments,
maps, time-series graphs, and more.

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 DATA VISUALIZATION 3
• Business intelligence
dashboards – Track corporate
metrics such as critical success
factors and key performance
indicators and include advanced
capabilities such as interactive
controls allowing users to
manipulate data for analysis.

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 1

• Distributed computing –
Processes and manages
algorithms across many
machines in a computing
environment.

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 2
• Ledger – Records classified and
summarized transactional data.

• Blockchain – A type of distributed

ledger, consisting of blocks of data that
maintain a permanent and tamper-proof
record of transactional data.

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 3
• Proof-of-work – A requirement to define an expensive
computer calculation, also called mining, that needs to
be performed in order to create a new group of
trustless transactions (blocks) on the distributed
ledger or blockchain.

• Proof-of-work has two primary goals:

1. To verify the legitimacy of a transaction or avoid
the so-called double-spending
2. To create new digital currencies by rewarding
miners for performing the previous task

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 4

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 5
• Blockchain – Formed by linking together
blocks, data structures containing a hash,
previous hash, and data.
• Genesis block – The first block created in
the blockchain.
• Hash – A function that converts an input
of letters and numbers into an encrypted
output of a fixed length.

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 6

• Proof-of-stake – A way
to validate transactions
and achieve a
distributed consensus.

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 BLOCKCHAIN: DISTRIBUTED COMPUTING 7
Blockchain advantages.
• Immutability.
• Digital Trust.
• Internet of Things Integration.

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 End of Main Content

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