It helps to organize, find and understand data. The key point in this definition is that it describes and gives information about “an item”. Wiki’s definition is “metadata is data that describes other data”, in other words, it gives context, purpose and value to an item. Think about a construction project picture. How would you describe it for marketing purpose?
It has a date, project title, country, market, services, etc. These are properties of the project picture that give it context and value and collectively we call this metadata. In Excel this would be information in columns you can use to filter and search.
In SharePoint, it's exactly the same and you can do a lot more. You can use it to control views on multiple pages, you can set alerts and reminders, you can restrict access based on it.
When uploading a new project image to SharePoint, a form will prompt you to fill in the information according to a predefined structure.
When creating your PMIS, certain key metadata will be centralized, such as your company's markets. You don't want each user to define or spell it differently. These "managed metadata" will be made available for all applications on the entire site.
It's that simple 😉.
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