File-oriented and transaction-oriented storage systems use digital technology, including computers and local area networks, to store information for businesses across the country. For small business owners, utilizing transaction-oriented storage methods may cost more up front in terms of hardware purchases, but the savings arrive in the form of data reliability and security.
A file-oriented approach to storage creates files in sets as needed when a business sells products or services. Each file operates independently from other files in storage. This means files don't share information with other files stored in the system. Every new client or sales transaction a business acquires generates a new unit of information. A business selling products at a high rate can accumulate units for storage rapidly, which increases the chance for storage errors due to misfiled documents.
File Storage Problems
The independence of information throughout a file-oriented storage system makes it difficult for a business to group data sharing common characteristics and streamline data files. Because each sale generates a new file, searching for a single customer's full transaction history can require a business to scour the entire storage system. The risk for duplicate information within the system also increases because individual records lack integration with other stored files. For example, accountants searching transaction histories may find multiple copies of the same sale records from the shipping department, the billing office and sales representatives.
Transaction-oriented storage or database storage is a more modern approach to maintaining business information files. A business employing a transaction-oriented approach to storage uses a storage-area network — SAN — to integrate files across multiple information systems. Each information unit within the system has its own set repository where new information relating to that unit appears. This storage method eliminates the need to create new files every time a transaction occurs. Instead, a business can allocate new information to files containing matching transaction information. For example, an SAN can have individual customer files that contain purchasing information relevant to each individual customer.
Database Storage Advantages
Storing information in a database that all departments within a business can access allows a company to shrink its devoted space for file storage. Multiple projects can obtain the same information at once and work simultaneously to complete critical steps. A business can finish projects faster when it's easier to find the right information. Monitoring the safety of information in a central database is easier because the business has to watch only one central location. Backing up information is also simpler because the business doesn't have to worry about redundant files throughout the system.
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