One of the nice features you had back in SQL Server 2000 was the ability to create ER diagrams directly in the database tool. I really enjoyed this feature cause you had the ability to start directly creating tables, fields structure and links between tables immediately.

While being busy working with Oracle and pre-installed databases in MSSQL, I didn’t note that if you want to use this feature in SQL Server 2012 Management Studio, you must execute an special configuration directly into the database.

So, if you create your database using the default options, like I did, and try to create a new diagram, you get an error as follows:

Database diagram support objects cannot be installed because this database does not have a valid owner.  To continue, first use the Files page of the Database Properties dialog box or the ALTER AUTHORIZATION statement to set the database owner to a valid login, then add the database diagram support objects.

When using default options, database is not getting an owner. Then, you must run the following T-SQL query to enable the required functionality (assume database name is DB_demo and you set user SomeUser as owner):

ALTER AUTHORIZATION ON DATABASE::[DB_demo] TO SomeUser
GO

By doing this, now you have the option to create ER diagrams in SQL Server Management Studio.

Have a good day.