Digital Strategy, Technology and Architecture for the Enterprise

Introduction to
Data, Information, Knowledge, Wisdom (DIKW)
and
Information /Digital Systems for Competitive Advantage

Session 02/03
Prof. Milind kamat
Top companies of Today are built on data/information
 What is
Analog Data
vs
digitized Data?

Bits world!
 0 = OFF
1= ON
Binary
representation

Analog Vs Digital
World of bits
On and off … large number
 DIKW
Pyramid
 What is DATA,
Information,
Knowledge, and
Wisdom
pyramid?

DIKW Pyramid
Data, Information , Knowledge & wisdom
Activity

500? Raw Number Data

GMAT of (Data + Context )

Context provided
Student X Information

SPJIMR accepts
only GMAT scores Past Experiences
Knowledge
above 550 for Past History
PGPM

Student has two

options The student decided not to wait
Still apply and try and applied to another school Wisdom
Or that has a history of accepting A=
Apply to another GMAT 500 application of knowledge to available
school who accepts information to achieve better outcomes
GMAT score 500
 • items refer to an elementary description of things, events,
activities, and transactions that are recorded, classified, and
stored but are not organized to convey any specific
Data meaning. Data items can be numbers, letters, figures,
sounds, and images. Examples of data items are collections
of numbers (e.g., 3.11, 2.96, 3.95, 1.99, 2.08) and characters
(e.g., B, A, C, A, B, D, F, C).
 Refers to data that have been organized so
that they have meaning and value to the
recipient. For example, a grade-point
average (GPA) by itself is data, but a
Information student’s name coupled with his or her
GPA is information. The recipient interprets
the meaning and draws conclusions and
implications from the information.
 It consists of data and information that have been
organised and processed to convey understanding,
experience, accumulated learning, and expertise as they
apply to a current business problem.
For example, suppose that a company recruiting at your
school has found over time that students with GPAs over
3.0 have experienced the greatest success in its
management program. Based on this accumulated
Knowledge knowledge, that company may decide to interview only
those students with GPAs over 3.0. This example presents
an example of knowledge because the company utilises
information GPAs to address a business problem—hiring
successful employees. As you can see from this example,
organisational knowledge, which reflects the experience
and expertise of many people, has great value to all
employees.
 DIKW (Data, Information, Knowledge, Wisdom) is a hierarchical model
that represents the transformation of raw data into actionable insights

Let's say a manufacturing company wants to improve its production process.

They collect data from their machines, including the number of units produced, the amount of raw materials used, and the time it takes to manufacture each unit.
This data is raw and unprocessed.
Data: The company collects data on the number of units produced, raw materials used, and the time taken to manufacture each unit. This is raw data of
numbers, strings etc

Information: The company can generate more useful information by analysing the data.
For example, they can calculate the average production time per unit, the cost of raw materials per unit, and the overall production cost.

Knowledge: The company can gain knowledge about the manufacturing process based on the information generated.
They may learn that a particular machine is causing a bottleneck in the production process or that certain raw materials are more expensive than others.
This knowledge can help the company identify areas for improvement and make data-driven decisions.

Wisdom: With the knowledge gained, the company can make wise decisions on improving the production process.
For example, they may invest in a new machine to reduce the production time or switch to a cheaper raw material to reduce costs.
By applying their knowledge and experience, they can make wise decisions that drive the success of their business.
4 DIKW Pyramid

Data | Raw, unorganised facts and figures that have no context or meaning

Information | Data has been organised and processed to provide context and
meaning. The information helps answer "who, what, when, and where" questions,
but not "why" questions.

Knowledge | Information analysed and synthesised to provide insights and

understanding. Knowledge helps answer "why" questions and enables people to
make decisions and take action.

Wisdom | The ability to make wise decisions based on a deep understanding

of the world and the ability to apply principles and values to complex situations.
Wisdom involves intuition, creativity, and judgment, and it is built on a foundation of
data, information, and knowledge.
Foundational Concepts and Theories
for DIKW Pyramid
Information Systems

• Data and (Data + Context) = Information = Phase 1 of Deals with PAST

Information systems: Individual, Functional IS systems: NOT Transaction
integrated at all processing systems
• Knowledge: Based on experience, events, and history = we E-commerce systems
get loads of knowledge Descriptive analytics
• Era of Knowledge Management Systems systems

• WISDOM: Based on Information we have, we collect, or We

Get and Using Knowledge we have, We apply our Deals with Future
Judgement and take appropriate Decisions for ACTION Statistical
predictions/ML/AI
Systems with Predictive and prescriptive analytics
Ever increasing speed of
converting Atoms to Bits
Ever evolving
Bits world
Bits companies are the
biggest companies on
planet
 Atoms (Physical worlds objects)
To
Bits(digital world objects) Transition /Transformation
Rapid
transition and
transformation
from ATOMS
TO BITS
 Rise and Rise of Digital Computing
The transition from Atoms to Bits
⚫️ Atoms (⚛⚛⚛): The smallest unit of
matter. & The company which builds
purely based on substances aka a
company having physical visible products.
Innovation in this area is consistently
slowed down in this area. (Ford, Coca-
Cola, Shell, GM, GE, …)
All the innovation in the 20th mostly on Atoms &
21st century with Bits. Most of the companies in the
world are majorly categorized as either bits or atoms
companies ⚫️Bits (0⃣1⃣1⃣0⃣): Company which builds
on bits & bytes (0s & 1s) as a fundamental building
block. most of the Internet/Software company
survive with this principle. Innovation in this area is
consistently accelerating in this area. there are too
many bits companies right now (WhatsApp,
Google, Facebook, Twitter)
Digital PLATFORMS firms ARE OVERTAKING
Traditional leading industries like
ENERGY AND BANKING lagging behind

Source: Visualcapitalist.com, Bloomberg

9
DATA is new Oil
Bits exponential
rise every year
 Birth of Silicon ,
Silicon valley and
digital computers

https://www.youtube.com/watch?v=M4VP7TuZjt8
History input devices
Computer processing

• Batch processing
• Intercative terminal-based
inputs
• Graphics terminals
• Online Earlier it was computer
centre, computer
• Realtime processing beuro
 New age self-serviced
Users enter most of the data.
Evolution of Bits World
3 Main dimensions
Progress
 https://www.computerhistory.org/timeline/computers
History of computing /

Every Iteration,
• Computing power went Up
• The scale of production has gone up
• Power consumption went down
• Size has gone down
• Cost/price has down
• more user-friendly and accessible to the incremental human population
Cellphones as an
extension of humans

Samsung Fold
 Welcome
to
New Digital World
• 1G : Focused purely on Voice
• 2G : Focused on Voice & Text
• 3G : focused on voice and text , Data
• 4G : centered around the growing consumption of data with Video
• 5G :The Internet of Things (IoT) was at the heart of 5G,
• 6G : is to deliver multi-sensory experiences that will be almost
inseparable from reality. This has been coined as the Internet of
Senses (IoS). The Internet of Senses will rely on AI, VR, AR and
Automation to interact with our five senses of sight, sound, taste,
smell and touch.
 What are
Digital/IT/Communication
Technologies?
 Power of Information Connectivity(Internet: Digital Highway)
and
Rise of Computing Technologies
=
Digital Technologies
ATOM to BITS
IT = More atoms than Bits Fueling New Economic Progress
Digital = Business has more
bits than Atoms
Massive Hyper-scale
Digital technologies

1 SMAC

2 IOT/Blockchains

Accessibility at an 3 3D Visualization/immersion
affordable price
4 3D Material production

5 Natural Language
Understanding/processing

Marginal Cost of 6 Artificial Intelligence

Production/Distribution bits =
Speed, Quality, Reliability, Ease of USE & Mobility at scale
ZERO
Material is Proprietary & confidential and can not be reproduced without express permission of Prof. M kamat( Head – Global MBA/MS USA/Europe/SPJIMR) Courage . Heart
What are the 3 eras of
the Internet?
 Digital Transformation 1.0
Internet of People
Content & Information Intensive industries disrupted and New Digital Natives Emerge

AI is fully
penetrated with
these
technologies

Enterprises Adopted Mobile and Social and Transformed Marketing , Customer service & Sales(e/M-commerce)
Nos of Market Places emerge , Cloud adoption was mixed !!
 Digital Transformation 2.0
Industrial Internet : Internet of Things : Sensors across the value Chains & supply
chains
New Cyber Physical world

BLOCKCHAINS

SMARTPHONE, WEARABLES, EDGE

VOICE ASSISTANTS, 3D PRINTING,
AR/VR COMPUTING

With 5G
STRUCTURED DATA, AUDIO,
VIDEO, TEXT, IMAGES ,
REALTIME MACHINE DATA ARTIFICIAL INTELLIGENCE ,
WITH VOLUME, VELOCITY, AUTOMATION TECHNOLOGIES, BOTS
VERACITY
 Digital Transformation 3.0 is Coming
“Internet of Value “
• The “Internet of value” is in a world where money changes hands at the speed of
information movement today.
• Transactions can occur in real-time and across global networks, addressing the
problem of cross-border payment systems that are not interoperable today.
DATA NEW Oil
 Data generated every 60 sec in 2019
Huge Big data to be leveraged by New digital enterprises for new business models
1 2 3

Communications Planet of the apps

Touch here
Convergence New modes for content and
A new order in Devices
Voice to all-data media consumption
Global connectivity turns
4 5 6
the consumer into an
iproducers

Social ubiquity YouVideo Retail 3.0

Platform shifts , monetization Rise of user-controlled Beyond multichannel to the
challenges programming and distribution store of future

Source : 2019
Courage . Heart
 • Variety: The analytic environment has expanded
from pulling data from enterprise systems to
including big data and unstructured sources.
• Volume: Large volumes of structured and
unstructured data are analysed.
Four V’s of • Velocity: Speed of access to reports that are
drawn from data defines the difference between
Data Analytics effective and ineffective analytics.
• Veracity: Validating data and extracting insight
that managers and workers can trust is key to
successful analytics. Trust in analytics. Trust
analytics has grown more difficult with the
explosion of data sources.
Mega shift find out data is telling
Data Visualisation & Analytics

PAST

FUTURE
Prediction
Machines
The domain of
Machine
learning

Courage . Heart
 Data Technologies Evolution
Acquire/store/analyse/Visualise
and distribute/Generate
 Different types of information /automation/visualisation/Generative
Technologies
Technology
Definition Examples
Category
Computer technologies are hardware and Central Processing Units (CPUs), Random Access Memory (RAM), Hard Disk
Computer software components that enable the processing, Drives (HDD), Solid State Drives (SSD), Input/Output Devices (keyboard,
Technologies storage, and retrieval of data using electronic mouse, etc.), Computer Peripherals (printers, scanners, etc.), Operating
devices. Systems, Cloud Computing.
Database Management Systems, Data Mining, Geographic Information
Information technologies are tools and systems
Information Systems (GIS), Cloud Computing, Content Management Systems, Enterprise
that enable the creation, management,
Technologies Resource Planning (ERP), Customer Relationship Management (CRM),
:
processing, storage, and sharing of information.
Electronic Data Interchange (EDI).
Communication technologies are toolsD and
Communication Wireless Networks, Email, Video Conferencing, Social Media, Web Browsers,
systems that enable the transmission of
Technologies Satellite Communication, Instant Messaging.
information and data between people or devices.
Search Engines, E-commerce Platforms, Cloud Computing, Social Media,
Internet-based digital technologies are tools and Web-based Email, Online Streaming Services, Digital Advertising Platforms,
Internet-Based Digital
systems that are accessed and utilized over the Virtual Private Networks (VPNs), Artificial Intelligence (AI), Machine Learning
Technologies
internet. (ML), Natural Language Processing (NLP), Language Models (LLMs), chatbots
(such as GPT).
AI is a field of computer science that focuses on
Image and Speech Recognition, Autonomous Vehicles, Chatbots, Robotics,
creating intelligent machines that can learn and
Artificial Intelligence Machine Learning (ML), Natural Language Processing (NLP), Language
make decisions like humans. Generative AI is a
(AI) Models (LLMs), Generative Adversarial Networks (GANs), Variational
subset of AI that involves the use of algorithms to
Autoencoders (VAEs), Recurrent Neural Networks (RNNs).
generate new content or data.
Data acquisition technologies refer to the sensors,
Data Acquisition Cameras, LIDAR sensors, GPS devices, temperature sensors, accelerometers,
cameras, and other devices used to collect data
Technologies gyroscopes, pressure sensors.
from the physical world.
3D rendering technologies are used to create and
3D Rendering Virtual Reality (VR) systems, 3D printing, Computer-Aided Design (CAD)
display three-dimensional images, animations,
Technologies software, 3D modeling software, gaming engines, 3D animation software.
and simulations.
Automation technologies involve the use of Robotic Process Automation (RPA), Industrial Automation, Autonomous
Automation
machines, software, and systems to automate Systems, Machine Vision, Control Systems, Robotics, Collaborative Robots
Technologies
tasks and processes. (Cobots).
 Strategy, Sources of Competitive Advantage & Information

Threats
New
entrants

The firm of
Interest operates New
in Industry. Customers
Suppliers
And compete with Force
Compitative
Force
competitors to strategy
gain market share

Threats of
Subtitites

Strong Force within Industry erodes Margin

List of Initiatives which can move the firm

towards gaining a competitive advantage

WT
SO
IT/Digital initiatives to make better,
sustainable, effective
M. Porter’s Five Forces analysis is a framework that helps analyse the level of competition
within a certain industry.
Industry Competitiveness
M Porter’s Value Chain Analysis [Firm Level
Analysis]
M Porter’s Generic Strategy Matrix
 What is Competitive Advantage?
• Competitive advantage refers to the ways that a company can
produce goods or deliver services better than its competitors. It
allows a company to achieve superior margins and generate value
for the company and its shareholders.

• A competitive advantage is something that cannot be easily

replicated and is exclusive to a company or business. This value is
created internally and is what sets the business apart from its
competition.
 What is Business strategy?
What frameworks of Prof? M Porter are
used in building Business strategy?
Next class

What is a Value chain?

What are the 5 Forces?
What are the 4 generic competitive strategies mentioned by Prof. M Porter?
What are the sources of competitive advantage ?

Select a firm for your academic group and create a list of sources of competitive advantage using
Information and digital technologies.
An example Excel sheet is attached for reference
Example guidelines & template

Ilustration to IT /Digital startegy Class only

TOP down identification of IT/Digital Initiatives

Thank you