A hierarchical reference data set allows users to model hierarchical data structures. When you create a code list in a hierarchical reference data set, the code list inherits the hierarchical structure definition. In the code list, you can arrange the code values into levels to create hierarchies. For example, you might create a hierarchical reference data set for industry classification systems or cost centers.
After you create a hierarchical reference data set, you cannot change the structure definition. If you create a code list in a hierarchical reference data set, the code list must use the inherited structure definition.
For example, you want to create an Industry Classifications reference data set. When you create the set, you define the structure definition as hierarchical because you know that industry classifications contain hierarchical code values. In the reference data set, you create an Enterprise Industry Classification code list, a NACE code list, a SBI code list, and a NAICS code list. In the NAICS code list, you arrange the code values into a hierarchy to reflect the hierarchical structure of this externally mandated list.