Role of Information

Md. Rashedul Hasan

Southern University Bangladesh.
OBJECTIVES

• To have knowledge about Data & Information

• To have knowledge about types of Data & Information
• Characteristics of Information
• Value of Information
• Uses of Information
• Role of Information
Data, Information & Knowledge
Data versus Information

• Data refers to raw, unevaluated facts, figures, symbols, objects,

events, etc. Data may be a collection of facts lying in storage,
like a telephone directory or census records.

• Information is data that have been put into a meaningful and

useful context and communicated to a recipient who uses it to
make decisions. Information involves the communication and
reception of intelligence or knowledge.
Data versus Information

• Data – is a collection of raw facts and/or figures that have yet

been processed, manipulated or interpreted into useful
information. Once the data has been processed, it can be
considered to be information

• Information – is therefore data that has been manipulated so that

some meaning can be derived from it
Data versus Information
Data
Etymology "Data" comes from a singular Latin word,
datum, which originally meant "something
given." Its early usage dates back to the
1600s. Over time "data" has become the
plural of datum.
Meaning Data is raw, unorganized facts that need
to be processed. Data can be something
simple and seemingly random and
useless until it is organized.
Example Each student's test score is one piece of
data.
Information
"Information" is an older word that dates
back to the 1300s and has Old French
and Middle English origins. It has
always referred to "the act of informing,
" usually in regard to education,
instruction, or other knowledge
communication.
When data is processed, organized,
structured or presented in a given
context so as to make it useful, it is
called information.
The average score of a class or of the
entire school is information that can be
derived from the given data.
Data Vs. Information

Data are simply bits of information, but not information itself.

When data are processed, interpreted, organized, structured or
presented so as to make them meaningful or useful, they are
called information. Information provides context for data.

For example, a list of dates — data — is meaningless without

the information that makes the dates relevant (dates of holiday).
The number of visitors to a website by country is an example of
data. Finding out that traffic from the U.S. is increasing while that
from Australia is decreasing is meaningful information.
Data Vs. Information

Data is used as input for the computer system. Information is the

output of data.
Data is unprocessed facts figures. Information is processed data.
Data doesn’t depend on Information. Information depends on
data.
Data is not specific. Information is specific.
Data doesn’t carry a meaning. Information must carry a logical
meaning.
Data is the raw material. Information is the product.
Types of Data & Information
Quantitative data
Qualitative data
Quantitative data

Is data or information that can be measured numerically and can be proven as fact.
Quantitative data is information that is measured and expressed as numbers.
Scores on standard tests like the Mid Term Exam, scores on scaled questions
(e.g., a five-point scale), and records of sessions attended, are examples of
quantitative data. These kinds of data are usually expressed as percentages,
ranges and averages, and can be presented in tables or graphs.

The main methods of collecting quantitative data are:

• by telephone
• in an interview, with questions asked by the interviewer (e.g., an assessment,
termination or follow-up interview)
• self-report, where respondents complete the questionnaire on their own, without
help from an interviewer. This can be done in person or by mail.
• Quantitative methods are good for collecting a large amount of data from a large
number of people, because the scoring, data entry and data analysis are relatively
easy and quick.
Qualitative data

• Involves data/information that cannot be measured in the usual

way. As such, it is usually in some sort of narrative form (spoken
or written).
• Qualitative data is extremely varied in nature. It includes virtually
any information that can be captured that is not numerical in
nature.
Data collection approaches for qualitative

Data collection approaches for qualitative research usually involves:

• Direct interaction with individuals on a one to one basis
• Or direct interaction with individuals in a group setting

Qualitative research data collection methods are time consuming,

therefore data is usually collected from a smaller sample than would be
the case for quantitative approaches - therefore this makes qualitative
research more expensive.
• The benefits of the qualitative approach is that the information is richer
and has a deeper insight into the phenomenon under study
• The main methods for collecting qualitative data are:
Individual interviews
Focus groups
Observations
Action Research
Qualitative Vs. Quantitative
Qualitative Vs. Quantitative

• Oil Painting Qualitative data:

blue/green color, gold frame
smells old and musty
texture shows brush strokes of oil paint
peaceful scene of the country
masterful brush strokes
• Oil Painting Quantitative data:
picture is 10" by 14"
with frame 14" by 18"
weighs 8.5 pounds
surface area of painting is 140 sq. in.
cost $300
Types of Data & Information
Primary data
Secondary data
Primary data

• Primary data means original data that has been collected specially for

the purpose in mind. It means someone collected the data from the
original source first hand. Data collected this way is called primary
data.
• Is data that you or your organisation gathers and interprets yourself. An
example might be that you do a survey among your customers about
the quality of service your organisation offers.
• The people who gather primary data may be an authorized
organization, investigator, enumerator or they may be just someone
with a clipboard. These people are acting as a witness so primary data
is only considered as reliable as the people who gathered it.
Secondary data

• Would be where another organisation uses the data you have

collected and interprets it for other purposes (for example, in a
comparison of customer satisfaction for a number of
organisations offering the same type of service)
• Secondary data is data that has been collected for another
purpose. When we use Statistical Method with Primary Data
from another purpose for our purpose we refer to it as
Secondary Data. It means that one purpose's Primary Data is
another purpose's Secondary Data. Secondary data is data that
is being reused. Usually in a different context.
• Research where one gathers this kind of data is referred to
as desk research.
• For example: data from a book.
• Primary Information Sources
• The primary information sources are those that contain the
primary information that is the first hand information. For
example if you take a statistical data directly from the person
who has obtained the data then it would be from the primary
source.
• Similarly a teacher can also be called a primary source of
information, though he may have learned from the secondary
source but since you get the information directly from the teacher
he/she serves as the primary source.
• Secondary Information Sources
• Secondary information sources are those sources which are the
analysis or are based on the primary information.
• Most of the information sources that we use for a research are
mostly secondary, for example a text book containing various
laws of physics that were made by different scientists is a
secondary source containing information that was primary to the
scientists that made the law.
• News papers are also a secondary source as they contain the
information that was collected by some one else.
• Some of the commonly used secondary information sources are:
• Books, which includes text books, autobiographies, etc
• Periodicals
• Electronic sources
Types of Data & Information
Internal information
External information
• INTERNAL INFORMATION is information comes from inside the
business e.g. company reports from other years, internal e-mails
between employees or minutes from department meetings

• EXTERNAL INFORMATION is information comes from outside

the business e.g. from suppliers, competitors or customer
surveys, press articles.
• Accounting records are a prime source of internal information. They
detail the transactions of the business in the past - which may be used
as the basis for planning for the future (e.g. preparing a financial
budget or forecast).
The accounting records are primarily used to record what happens to
the financial resources of a business. For example, how cash is
obtained and spent; what assets are acquired; what profits or losses
are made on the activities of the business.
However, accounting records can provide much more than financial
information. For example, details of the products manufactured and
delivered from a factory can provide useful information about whether
quality standards are being met.
• Data analyzed from customer sales invoices provides a profile of what
and to whom products are being sold.
• A lot of internal information is connected to accounting systems - but is
not directly part of them. For example:
 Records of the people employed by the business (personal details;
what they get paid; skills and experience; training records)

Data on the costs associated with business processes (e.g. costing

for contracts entered into by the business)

Data from the production department (e.g. number of machines;

capacity; repair record)

Data from activities in direct contact with the customer (e.g. analysis
of calls received and missed in a call centre)

A lot of internal information is also provided informally. For example, regular

meetings of staff and management will result in the communication of relevant
information.
Characteristics of Information

The characteristics of good information are relevance, timeliness, accuracy, cost-

effectiveness, reliability, usability, exhaustiveness, and aggregation level.
• Information is relevant if it leads to improved decision making. It might also be
relevant if it reaffirms a previous decision. If it does not have anything to do with
your problem, it is irrelevant. For example, information about the weather
conditions in Paris in January is relevant if you are considering a visit to Paris in
January. Otherwise, the information is not relevant.
• Timeliness refers to the currency of the information presented to the users.
Currency of data or information is the time gap between the occurrences of an
event in the field until its presentation to the user (decision maker). When this
amount of time is very short, we describe the information system as a real-
time system.
• Accuracy is measured by comparing the data to actual events. The importance of
accurate data varies with the type of decisions that need to be made. Payroll
information must be exact. Approximations simply will not suffice. However, a
general estimate of how much staff time was devoted to a particular activity may be
all that is needed.
Value of Information

Information has a great impact on decision making, and hence

its value is closely tied to the decisions that result from its use.
Information does not have an absolute universal value. Its value
is related to those who use it, when it is used, and in what
situation it is used. In this sense, information is similar to other
commodities. For example, the value of a glass of water is
different for someone who has lost his way in Arctic glaciers than
it is to a wanderer in the Sahara Desert.
Information supports decisions, decisions trigger actions, and
actions affect the achievements or performance of the
organization.
Uses of Information in a Business
Use Description
Planning To plan properly, a business needs to know what resources it has (e.g. cash, people, machinery and
equipment, property, customers). It also needs information about the markets in which it operates and
the actions of competitors. At the planning stage, information is important as a key ingredient in
decision-making.
Recording Information about each transaction or event is needed. Much of this is required to be collected by law -
e.g. details of financial transactions. Just as importantly, information needs to be recorded so that the
business can be properly managed.
Controlling Once a business has produced its plan it needs to monitor progress against the plan - and control
resources to do so. So information is needed to help identify whether things are going better or worse
than expected, and to spot ways in which corrective action can be taken
Measuring Performance must be measured for a business to be successful. Information is used as the main way
of measuring performance. For example, this can be done by collecting and analyzing information on
sales, costs and profits
Decision-making Information used for decision-making is often categorized into three types:
(1) Strategic information: used to help plan the objectives of the business as a whole and to measure
how well those objectives are being achieved. Examples of strategic information include:
- Profitability of each part of the business
- Size, growth and competitive structure of the markets in which a business operates
- Investments made by the business and the returns (e.g. profits, cash inflows) from those investments
(2) Tactical Information: this is used to decide how the resources of the business should be
employed. Examples include:
- Information about business productivity (e.g. units produced per employee; staff turnover)
- Profit and cash flow forecasts in the short term
- Pricing information from the market
(3) Operational Information: this information is used to make sure that specific operational tasks are
The Role of Information Systems in Business Today

It’s not business as usual in America any more, or the rest of the
global economy. In 2007, American businesses had invested
nearly $1 trillion in information systems hardware, software, and
telecommunications equipment—more than half of all capital
investment in the United States. In addition, they had spend
another $250 billion on business and management consulting
and services—much of which involves redesigning firms’
business operations to take advantage of these new
technologies. More than half of all business investment in the
United States each year involves information systems and
technologies.
The Role of Information Systems in Business Today

INFORMATION SYSTEMS ARE TRANSFORMING BUSINESS

• You can see the results of this massive spending around you
every day by observing how people conduct business. More
wireless cell phone accounts were opened in 2007 than
telephone land lines installed. Cell phones, wireless handhelds,
e-mail, and online conferencing over the Internet have all become
essential tools of business.
• In 2007, more than 40 million businesses had dot-com Internet
sites registered. Six million Americans purchase something every
day on the Internet, 19 million research a product, and 38 million
use a search engine. What this means is that if you and your
business aren’t connected to the Internet and wireless networks,
chances are you are not being as effective as you could be.
• In 2006, FedEx moved in the United States nearly 200 million
packages, mostly overnight, and the United Parcel Service (UPS)
moved more than 570 million packages, as businesses sought to
sense and respond to rapidly changing customer demand, reduce
inventories to the lowest possible levels, and achieve higher levels of
operational efficiency.
• Supply chains have become more fast paced, with companies of all
sizes depending on the delivery of just-in-time inventory to help them
compete. Companies today manage their inventories in near real time
in order to reduce their overhead costs and get to market faster.
• If you are not a part of this new supply chain management economy,
chances are your business is not as efficient as it could be.
• As newspaper readership continues to decline, 94 million people read at
least some of their news online. Sixty million bank online, and 55 million
now read blogs, creating an explosion of new writers, readers, and new
forms of customer feedback that did not exist before. This means your
customers are empowered and talk to each other about your business
products and services.
• Do you have a solid online customer relationship program in place? Is
your marketing department listening?
• E-commerce and Internet advertising are booming: Google’s online ad
revenues surpassed $10 billion in 2006. Internet advertising continues to
grow at more than 15 percent a year, at the expense of traditional media,
reaching more than $18 billion in revenues in 2007. Is your advertising
department reaching this new Web-based customer base?
• New federal security and accounting laws require many businesses to keep e-mail messages
for five years. Coupled with existing occupational and health laws requiring firms to store
employee chemical exposure data for up to 60 years, these laws are spurring the growth of
digital information now estimated to be 5 exabytes, equivalent to 37,000 Libraries of
Congress. Does your compliance department meet the minimal requirements for storing
financial, health, and occupational information? If they don’t, your entire business may be at
risk.

• Briefly, it’s a new world of doing business, one that will greatly affect your future business
career. Along with the changes in business come changes in jobs and careers. No matter
whether you are a finance, accounting, management, marketing, operations management, or
information systems major, how you work, where you work, and how well you are
compensated will all be affected by business information systems.
GLOBALIZATION CHALLENGES AND OPPORTUNITIES: A FLATTENED
WORLD

By 2005, journalist Thomas Friedman wrote an influential book declaring the world
was now “flat,” by which he meant that the Internet and global communications had
greatly reduced the economic and cultural advantages of developed countries.

“Globalization” presents you and your business with both challenges and
opportunities. A growing percentage of the economy of the United States and other
advanced industrial countries in Europe and Asia depends on imports and exports.
In 2007, more than 33 percent of the U.S. economy resulted from foreign trade,
both imports and exports. In Europe and Asia, the number exceeds 50 percent.
Many Fortune 500 U.S. firms derive half their revenues from foreign operations.

For instance, more than half of Intel’s revenues in 2006 came from overseas sales
of its microprocessors. Toys for chips: 80 percent of the toys sold in the United
States are manufactured in China, while about 90 percent of the PCs manufactured
in China use American-made Intel or Advanced Micro Design (AMD) chips. It’s not
just goods that move across borders. So too do jobs, some of them high-level jobs
that pay well and require a college degree.
In the past decade the U.S. lost several million manufacturing jobs to
offshore, low-wage producers. But manufacturing is now a very small
part of U.S. employment (less than 12 percent). In a normal year,
about 300,000 service jobs move offshore to lower-wage countries,
many of them in less-skilled information system occupations, but also
including “tradable service” jobs in architecture, financial services,
customer call centers, consulting, engineering, and even radiology.

On the plus side, the U.S. economy creates over 3.5 million new jobs a
year, and employment in information systems, and the other service
occupations listed previously, has expanded in sheer numbers, wages,
productivity, and quality of work. Outsourcing has actually accelerated
the development of new systems in the United States and worldwide.
For the last several years there have been too few information systems
majors to fill the demand of employers in the United States.
The challenge for you as a business student is to develop high-
level skills through education and on-the-job experience that
cannot be outsourced. The challenge for your business is to
avoid markets for goods and services that can be produced
offshore much less expensively. The opportunities are equally
immense. You can learn how to profit from the lower costs
available in world markets and the chance to serve a
marketplace with billions of customers. You have the opportunity
to develop higher-level and more profitable products and
services.
What does globalization have to do with management information
systems? That’s simple: everything.
The emergence of the Internet into a full-blown international
communications system has drastically reduced the costs of operating
and transacting on a global scale. Communication between a factory
floor in Shanghai and a distribution center in Rapid Falls, South
Dakota, is now instant and virtually free. Customers now can shop in a
worldwide marketplace, obtaining price and quality information reliably
24 hours a day. Firms producing foods and services on a global scale
achieve extraordinary cost reductions by finding low-cost suppliers and
managing production facilities in other countries. internet service firms,
such as Google and eBay, are able to replicate their business models
and services in multiple countries without having to redesign their
expensive fixed-cost information systems infrastructure. Over half of
eBay’s revenues in 2007 originated outside the USA. Briefly,
information systems enable globalization.
Thank You