Understanding Databases 

A database is a collection of related data that is stored in a central location or in multiple locations. You can think of it as being similar to a filing cabinet, in which data is organized and stored in drawers and file folders. As you can imagine, however, retrieving data from a database is much faster.
Although a database can consist of only a single file, it is usually a group of files. A university database, for example, might have files for students, staff, faculty, and courses. In a database, a file is a group of related records, and a record is a group of related fields. This structure is called a data hierarchy. In a database system, all files are integrated, meaning information can be linked.
A database is a critical component of information systems because any type of analysis that is done is based on data available in the database. To make using databases more efficient, a database management system (DBMS) is used. A DBMS is software for creating, storing, maintaining, and accessing database files.
In the past, data was stored in a series of files that were called “flat files” because they were not arranged in a hierarchy, and there was no relationship among these files. The problem with this flat file organization was that the same data could be stored in more than one file, creating data redundancy. In a database, files are accessed by using a sequential, random, or indexed sequential method. In a sequential access file structure, records in files are organized and processed in numerical or sequential order, typically the order in which they were entered.
In a random access file structure, records can be accessed in any order, regardless of their physical locations in storage media. This method of access is fast and very effective when a small number of records needs to be processed daily or weekly. With the indexed sequential access method (ISAM), records can be accessed sequentially or randomly, depending on the number being accessed. For a small number, random access is used, and for a large number, sequential access is used. This file structure is similar to a book index that lists page numbers where you can find certain topics.