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Data flow diagrams (or DFD) illustrate how data is processed by a system in terms of inputs and outputs.
There are 2 types of notation used in a DFD: Yourdon & Coad or Gane & Sarson. They differ in the types of shapes used to describe a process and data store.
A data flow diagram includes four components: terminators/external entities, processes, data stores, data flows.
A DFD is most useful when it is necessary to document the flow of data within a currently used system, or a system that is in the process of being built. Data flow diagrams are helpful for both software engineers and operations personnel because their creation does not require technical knowledge.