Laudon ch06 v4
Laudon ch06 v4
Foundations of
Business Intelligence:
Databases and
Information
Management
6.1
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.2
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.3
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
A computer system
organizes data in a
hierarchy that starts with the
bit, which represents either
a 0 or a 1. Bits can be
grouped to form a byte to
represent one character,
number, or symbol. Bytes
can be grouped to form a
field, and related fields can
be grouped to form a record.
Related records can be
collected to form a file, and
related files can be
organized into a database.
Figure 6-1
6.4
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.5
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
The use of a traditional approach to file processing encourages each functional area in a corporation to
develop specialized applications and files. Each application requires a unique data file that is likely to be a
subset of the master file. These subsets of the master file lead to data redundancy and inconsistency,
processing inflexibility, and wasted storage resources.
Figure 6-2
6.6
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Database:
• Collection of data organized to serve many applications by
centralizing data and controlling redundant data
• Database management system:
• Interfaces between application programs and physical data files
• Separates logical and physical views of data
• Solves problems of traditional file environment
• Controls redundancy
• Eliminated inconsistency
• Uncouples programs and data
• Enables central management and security
6.7
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
A single human resources database provides many different views of data, depending on the information
requirements of the user. Illustrated here are two possible views, one of interest to a benefits specialist and
one of interest to a member of the company’s payroll department.
Figure 6-3
6.8
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Relational DBMS
• Represent data as two-dimensional tables called relations or files
• Each table contains data on entity and attributes
• Table: Grid of columns and rows
• Rows (tuples): Records for different entities
• Fields (columns): Represents attribute for entity
• Key field: Field used to uniquely identify each record
• Primary key: Field in table used for key fields
• Foreign key: Primary key used in second table as look-up field to
identify records from original table
6.9
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
A relational database organizes data in the form of two-dimensional tables. Illustrated here are tables for
the entities SUPPLIER and PART showing how they represent each entity and its attributes.
Supplier_Number is a primary key for the SUPPLIER table and a foreign key for the PART table.
Figure 6-4A
6.10
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
Figure 6-4B
6.11
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
The select, project, and join operations enable data from two different tables to be combined and only
selected attributes to be displayed.
Figure 6-5
6.12
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.13
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.14
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
Figure 6-6
The sample data dictionary
report for a human
resources database
provides helpful
information, such as the size
of the data element, which
programs and reports use it,
and which group in the
organization
is the owner responsible for
maintaining it.
6.15
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
An unnormalized relation contains repeating groups. For example, there can be many parts and suppliers
for each order. There is only a one-to-one correspondence between Order_Number and Order_Date.
Figure 6-9
6.16
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
After normalization, the original relation ORDER has been broken down into four smaller relations. The
relation ORDER is left with only two attributes and the relation LINE_ITEM has a combined, or
concatenated, key consisting of Order_Number and Part_Number.
Figure 6-10
6.17
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
An Entity-Relationship Diagram
This diagram shows the relationships between the entities ORDER, LINE_ITEM, PART, and SUPPLIER that
might be used to model the database in Figure 6-10.
Figure 6-11
6.18
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.19
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
The data warehouse extracts current and historical data from multiple operational systems inside the
organization. These data are combined with data from external sources and reorganized into a central
database designed for management reporting and analysis. The information directory provides users
with information about the data available in the warehouse.
Figure 6-13
6.20
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Business Intelligence:
• Tools for consolidating, analyzing, and providing access
to vast amounts of data to help users make better
business decisions
• E.g. Harrah’s Entertainment analyzes customers to
develop gambling profiles and identify most profitable
customers
• Principle tools include:
• Software for database query and reporting
• Online analytical processing (OLAP)
• Data mining
6.21
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
Business Intelligence
6.23
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Data mining:
• More discovery driven than OLAP
• Finds hidden patterns, relationships in large databases
• Infers rules to predict future behavior
• The patterns and rules are used to guide decision making
and forecast the effect of those decisions
• Popularly used to provide detailed analyses of patterns in
customer data for one-to-one marketing campaigns or to
identify profitable customers.
• Less well known: used to trace calls from specific
neighborhoods that use stolen cell phones and phone
accounts
6.24
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Predictive analysis
• Uses data mining techniques, historical data, and
assumptions about future conditions to predict outcomes of
events
• E.g. Probability a customer will respond to an offer or
purchase a specific product.
• Data mining seen as challenge to individual
privacy
• Used to combine information from many diverse sources to
create detailed “data image” about each of us—income,
driving habits, hobbies, families, and political interests
6.25
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
Users access an organization’s internal database through the Web using their desktop PCs and Web
browser software.
Figure 6-16
6.26
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.27
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.28
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
6.29
Management Information Systems
Chapter 6 Foundations of Business Intelligence: Databases
and Information Management
• Data cleansing:
• Detecting, and correcting data that are incorrect,
incomplete, improperly formatted, or redundant.
• Enforces consistency among different sets of data from
separate information systems
6.30