MODULE 4

FUNDAMENTALS OF BUSINESS ANALYTICS

• Data Collection
• Data
• Database Management System
Learning Objectives:

After completing this course, you should be able to:

• understand the concepts of data collection and problem
formulation
• distinguish between primary and secondary data sources
• determine the types of data that can be gathered/collected and
sorted.
• understand the difference between nominal-, ordinal-, interval-, and
ratio- based data
Learning Objectives:

After completing this course, you should be able to:

• discuss the basic concepts on data, database, and database
management system;
• explain the functions and components of a database and a
database management system.
 Introduction

Before beginning to analyze data, analysts must know how to answer these
questions:

• How do we collect data?

• What kinds of data exist?
• Where is it coming from?
 The Value of Data

Data is a valuable asset that helps build sustainable competitive advantage

A motivating example

In 2017, video-streaming company Netflix Inc. was worth more than $80 billion,
more than 100 times its value when it listed in 2002. The company’s current
position as the market leader in the online-streaming sector is a far cry from its
humble beginning as a DVD rental-by-mail service founded in 1997.
So, what had driven Netflix’s incredible success?
 Data Collection Preliminaries

A well-known management adage goes, “We can only manage what we can
measure.” But why is measurement considered so critical?

Measurement is important because it precedes analysis, which in turn precedes

modeling. And more often than not, it is modeling that enables prediction.
Without prediction (determination of the values an outcome or entity will take under
specific conditions), there can be no optimization. And without optimization, there is
no management.

The quantity that gets measured is reflected in our records as “data.”

Data, Information and Data Sets

 Data: numerical or textual facts and figures that are collected through
some type of measurement process.

 Information: result of analyzing data; that is, extracting meaning from data to
support evaluation and decision making.

 A data set is simply a collection of data.

 Primary and Secondary Data

Primary data - data that is collected

“at source” (hence, primary in form)
and specifically for the research at
hand.
The data source could be individuals,
groups, organizations, etc. and data
from them would be actively elicited
or passively observed and collected.
Thus, surveys, interviews, and focus The main advantage of primary data is that
groups all fall under the ambit of it is tailored specifically to the questions
primary data. posed by the research project. The
disadvantages are cost and time.
 Primary and Secondary Data

Secondary data - refers to information that has already been collected,

processed, and published by someone else for a purpose other than the
current research.
Secondary data can be obtained
from sources like books, articles,
reports, databases, or other pre-
existing data sets.
Data Collection Methods

(1) data generation through a designed experiment and

In a designed experiment, researchers deliberately manipulate one or more
independent variables to observe the effect on a dependent variable. The goal is
to establish cause-and-effect relationships between variables under controlled
conditions.
(2) collecting data that already exists
It involves using information that has been previously collected for a
different purpose. This approach is often referred to as secondary data analysis.
Collection of such data is usually done in three possible ways:
(1) complete enumeration,
(2) sample survey, and
(3) through available sources where the data was collected possibly for a different
purpose and is available in different published sources.
Secondary Data

 SECONDARY DATA can be collected from two sources: internal or external.

Internal data is collected by the company or its agents on behalf of the
company. The defining characteristic of the internal data is its proprietary
nature; the company has control over the data collection process and also has
exclusive access to the data and thus the insights drawn on it.

The external data, can be collected by either third-party data providers

(such as IRI, AC Nielsen) or government agencies.
 Secondary Data

EXAMPLES OF DATA SOURCES AND USES

 Internal  New developments: Web behavior –
 Annual reports Social Media – Mobile - IOT
 Accounting audits  page views, visitor’s country, time of
view, length of time, origin and
 Financial profitability analysis destination paths, products they
 Operations management performance searched for and viewed, products
purchased, what reviews they read,
 Human resource measurements
and many others.
 External
 Economic trends
 Marketing research
Data Types and Data Scales
 What is Database?

What is a database?
1. A database is a collection of logically related data and it is typically
visualize as tables; composed of cells matched with several columns
and rows (Recario, 2018).
2. In computer terms, database is a collection of data, not necessarily
always stored in a computer, such as records stored in a filing
cabinet, in a notebook (Crisanto, 2018).
What is Database Management System
(DBMS)

 A DBMS is a collection of interrelated data using the software and hardware used to
access the data in a useful manner such as database or set of databases stored in a
disk or other media, a computer, or set of computers where the software to access
the database can run (Crisanto, 2018).

 2. A DBMS is a software package or software that allows you to store, retrieve,

package your database (Recario, 2018).
Functions of a Database Management
System

 The DBMS can provide a convenient and efficient interface for storing, retrieving, and
updating data, and for extracting useful information from the database, and a clear and
logical view of the process that manipulates the data.

 Data Independence: DBMS maintains the segregation between the program and the data
 Concurrency Control. This refers to a process to ensure that data is updated correctly and
appropriately when more than one person is accessing the data
 Recovery Services. This refers to mechanisms for recovery of data that is apparently lost due
to system crashes
 Utility Services: An initialization and maintenance operations on a database.
Functions of a Database Management
System

 Manipulation of data. It tells us that we can CRUD (create, retrieve, update, and delete) our
data within the DBMS.
 Database definition. Metadata describes the contents of your database. This is a data that
describes another data in terms of its constraints, size, and the data type of the tables or the
databases that are contained within your DBMS.
 Data Processing. This allows the user to perform different types of operations such as string
manipulation, date operations and so on. You can also manipulate the data based on an
event or what they call ‘triggers’ which is based on the event or the conditions of the event.
 Data sharing. This means that within a database, privileges are provided to different types
of users. Different types of users can access the same database but the same users can
have different privileges.
Relating DATABASE to USERS
the End Users

The DBMS serves as an

interface between the
Database
database and the end Application

user, guaranteeing that

information is reliably
organized and remains
accessible.
DBMS

Database
Components of a Database System -
Users

 The users of a database system are the database administrator, system developer, and
end user.
 A database administrator (DBA) is the person responsible for all the data resources in an
organization. The DBA uses tools that come with a DBMS to improve the productivity and
performance of database planning and design.
 The system developers are those groups of people who create the application
programs that cater to the user requirements. And, they use their own tools to write
programs that communicate with the DBMS.
 The end-users in an organization are the ones that can add, update, and delete data in
a database through application programs or directly through a DBMS. They use the
application program to accomplish their day-to-day tasks.
Components of a Database System –
Database Application

 This is a computer program that allows users to manipulate the data in a DBMS
through a user-friendly interface.
 It can be divided into four broad categories:
 Personal which is restricted to a single user;
 Departmental which is referenced by hundreds of users over a shared system or
network;
 Enterprise which extensions of departmental applications involving thousands of users;
 The Internet which is the largest form of information sharing where billions of users are
involved.
Components of a Database System –
DBMS

 The DBMS decouples application programs from data.

 The databases store all its data in one location, thereby limiting
data duplication.
Examples:
 Access
 Oracle
 IBM’s DB2
 SQL Server
Components of a Database System –
Database

 This is the space in the disk or computer where the data are
actually stored.
Components of a Database Management System
Components of a Database
Management System

Interface
 The interface is responsible for interacting with the user. It is also called the
“middleman” as it communicates between two different parties: the end user,
which is you, and the database management systems.
 The interface allows the end user to input values that will be understood by the
database management system. It is also responsible for the receiving and
outputting, and providing the results of the queries or the commands that the
end user issued.
 Components of a Database
Management System

Parser
 The parser is responsible for checking the correctness of the syntax that was
provided by the end user through the interface. So it also checks the tables and
other objects in the query.

Query Optimizer
 The query optimizer comes from the root word ‘optimize’, which means
it simplifies the query form or the input into a simpler type of input that can be
digested and can be understood by the database management system.
Components of a Database
Management System

Execution Engine
Its main responsibility is to execute the output of the query optimizer. Once the
query has been optimized, then it will pass the data or the optimized query to the
execution engine whose sole purpose is to execute the command.

Storage
Storage is the physical location of your database, which can be the secondary or
the primary memory.
References:

 Almodiel, M. & Garcia, P., Module 3: Data and Database Management In Almodiel &
Garcia P. (Ed)Fundametals of Business Analytics, A Business Analytics Course (pp 18-23),
University of the Philippines Open University