What is a Data Flow Diagram? Definition and meaning with an example

byTam M. | reviewed 2023-08-19

A Data Flow Diagram (DFD) is a graphical representation of the "flow" of data through an information system, modeling its process aspects. DFDs are commonly used in software design and business process modeling as a simple way to visualize how data is processed and transferred in a system. They allow the user to identify how and where the data is used, who uses it, what processing occurs, and where the data is stored. DFDs are also a great tool for communication and collaboration among various stakeholders.

Data flow diagrams or DFDs help the analysis of systems by showing:

Data sources
What processing happens and by whom
Who uses the data
Where data is stored and when
Outputs produced

In DFDs, data flows are represented by arrows, while processes are represented by circles, rectangles, or other shapes. External entities that interact with the system are shown as boxes, and data storage points are typically depicted as two parallel lines, like an open-ended rectangle.

The different levels of Data Flow Diagram

Representing the complete business system often requires multiple levels of diagram.

Context Diagram (Level 0 DFD)

This is the highest level of a DFD and provides a very abstract, high-level view of the system. The entire system is represented as a single process, with arrows indicating the data flow into and out of the system from external entities. It serves as a broad overview of the system and its interaction with external factors. This diagram is particularly useful for providing stakeholders with a rudimentary understanding of the system.

Level 1 DFD

This diagram breaks down the system from the Context Diagram into its major, high-level process components. Each component is represented as a process in this DFD. Level 1 DFD shows how the system is divided into sub-systems (processes), illustrating the flow of information from and to each of these sub-systems and how they interact with each other. As per the convention, it should typically describe the system using between two and seven functions.

[Level 1 Data Flow Diagram -] this highlights the main functions carried out by the system. As a rule, we try to describe the system using between two and seven functions. SQA

Level 2 DFD

If necessary, each of the high-level processes of the Level 1 DFD can be further broken down into their lower-level processes in the Level 2 DFD. This allows for a more detailed representation and understanding of the system's functioning. Each of these processes can be further divided into even lower levels until sufficient detail is achieved.