chapter 6 : Valuing Organizational
Information
Organizational Information
Information is everywhere in an
organization
Employees must be able to obtain and
analyze the many different levels, formats, and granularities of organizational
information to make decisions
Successfully collecting, compiling,
sorting, and analyzing information can provide tremendous insight into how an
organization is performing
Levels, formats, and granularities of
organizational information
Information Granularities
Refers to the extent of detail within the
information (fine and detailed or “coarse” and abstract information)
The Value of Transactional and Analytical Information
Transactional information – encompasses all
of the information contained within a single business process or unit of work,
and its primary purpose is to support the performing of daily operational tasks
Transactional information
E.g. withdrawing cash from an ATM, making
an airline reservation, purchasing stocks
Compile a list of additional transactional
information examples
These could include daily sales, hourly
employee payroll, product orders, shipping an order
Analytical Information
also includes external organizational
information such as market, industry, and economic conditions
Analytical information is used to make
ad-hoc decision.
E.g. trends, sales, product statistics, and
future growth projections
Compile a list of additional analytical
information examples
These could include cost/benefit analysis,
sales forecast, market trends, industry trends, and regulations
The Value of Timely Information
Timeliness is an aspect of information that
depends on the situation
Real-time information – immediate,
up-to-date information
Real-time system – provides real-time
information in response to query requests
Some decisions require weekly information
while others require daily information
Organizations such as 911 centers, stock
traders, and banks require up-to-the second information
The Value of Quality Information
Business decisions are only as good as the
quality of the information used to make the decisions
You never want to find yourself using
technology to help you make a bad decision faster
Characteristics of High Quality Information
The Value of Quality Information
Low quality information example
Understanding the Costs of
Poor Information
The four primary sources of low quality
information include:
Online customers intentionally enter
inaccurate information to protect their privacy
Information from different systems have
different entry standards and formats
Call center operators enter abbreviated or
erroneous information by accident or to save time
Third party and external information
contains inconsistencies, inaccuracies, and errors
Potential business effects resulting from
low quality information include:
Inability to accurately track customers
Difficulty identifying valuable customers
Inability to identify selling opportunities
Marketing to nonexistent customers
Difficulty tracking revenue due to
inaccurate invoices
Inability to build strong customer
relationships
Understanding the Benefits of
Good Information
High quality information can significantly
improve the chances of making a good decision
Good decisions can directly impact an
organization's bottom line
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