Good information is that which is used and which creates value. Experience and research shows that good information has numerous qualities.
Good information is relevant for its purpose, sufficiently accurate for its purpose, complete enough for the problem, reliable and targeted to the right person. It is also communicated in time for its purpose, contains the right level of detail and is communicated by an appropriate channel, i.e. one that is understandable to the user.
Further details of these characteristics related to organisational information for decision-making follows.
Information should be easy to obtain or access. Information kept in a book of some kind is only available and easy to access if you have the book to hand. A good example of availability is a telephone directory, as every home has one for its local area. It is probably the first place you look for a local number. But nobody keeps the whole country’s telephone books so for numbers further afield you probably phone a directory enquiry number. For business premises, say for a hotel in London, you would probably use the Internet.
Businesses used to keep customer details on a card-index system at the customer’s branch. If the customer visited a different branch a telephone call would be needed to check details. Now, with centralised computer systems, businesses like banks and building societies can access any customer’s data from any branch.
Information needs to be accurate enough for the use to which it is going to be put. To obtain information that is 100% accurate is usually unrealistic as it is likely to be too expensive to produce on time. The degree of accuracy depends upon the circumstances. At operational levels information may need to be accurate to the nearest penny – on a supermarket till receipt, for example. At tactical level department heads may see weekly summaries correct to the nearest £100, whereas at strategic level directors may look at comparing stores’ performances over several months to the nearest £100,000 per month.
Accuracy is important. As an example, if government statistics based on the last census wrongly show an increase in births within an area, plans may be made to build schools and construction companies may invest in new housing developments. In these cases any investment may not be recouped.
Reliability or objectivity
Reliability deals with the truth of information or the objectivity with which it is presented. You can only really use information confidently if you are sure of its reliability and objectivity.
When researching for an essay in any subject, we might make straight for the library to find a suitable book. We are reasonably confident that the information found in a book, especially one that the library has purchased, is reliable and (in the case of factual information) objective. The book has been written and the author’s name is usually printed for all to see. The publisher should have employed an editor and an expert in the field to edit the book and question any factual doubts they may have. In short, much time and energy goes into publishing a book and for that reason we can be reasonably confident that the information is reliable and objective.
Compare that to finding information on the Internet where anybody can write unedited and unverified material and ‘publish’ it on the web. Unless you know who the author is, or a reputable university or government agency backs up the research, then you cannot be sure that the information is reliable. Some Internet websites are like vanity publishing, where anyone can write a book and pay certain (vanity) publishers to publish it.
Information should be relevant to the purpose for which it is required. It must be suitable. What is relevant for one manager may not be relevant for another. The user will become frustrated if information contains data irrelevant to the task in hand.
For example, a market research company may give information on users’ perceptions of the quality of a product. This is not relevant for the manager who wants to know opinions on relative prices of the product and its rivals. The information gained would not be relevant to the purpose.
Ideally all the information needed for a particular decision should be available. However, this rarely happens; good information is often incomplete. To meet all the needs of the situation, you often have to collect it from a variety of sources.
Level of detail/conciseness
Information should be in a form that is short enough to allow for its examination and use. There should be no extraneous information. For example, it is very common practice to summarise financial data and present this information, both in the form of figures and by using a chart or graph. We would say that the graph is more concise than the tables of figures as there is little or no extraneous information in the graph or chart. Clearly there is a trade-off between level of detail and conciseness.
The presentation of information is important to the user. Information can be more easily assimilated if it is aesthetically pleasing. For example, a marketing report that includes graphs of statistics will be more concise as well as more aesthetically pleasing to the users within the organisation. Many organisations use presentation software and show summary information via a data projector. These presentations have usually been well thought out to be visually attractive and to convey the correct amount of detail.
Information must be on time for the purpose for which it is required. Information received too late will be irrelevant. For example, if you receive a brochure from a theatre and notice there was a concert by your favourite band yesterday, then the information is too late to be of use.
Value of information
The relative importance of information for decision-making can increase or decrease its value to an organisation. For example, an organisation requires information on a competitor’s performance that is critical to their own decision on whether to invest in new machinery for their factory. The value of this information would be high. Always keep in mind that information should be available on time, within cost constraints and be legally obtained.
Cost of information
Information should be available within set cost levels that may vary dependent on situation. If costs are too high to obtain information an organisation may decide to seek slightly less comprehensive information elsewhere. For example, an organisation wants to commission a market survey on a new product. The survey could cost more than the forecast initial profit from the product. In that situation, the organisation would probably decide that a less costly source of information should be used, even if it may give inferior information.
The difference between value and cost
Many students in the past few years have confused the definitions of value and cost. Information gained or used by an organisation may have a great deal of value even if it may not have cost a lot. An example would be bookshops, who have used technology for many years now, with microfiche giving way to computers in the mid to late 1990s. Microfiche was quite expensive and what the bookshops received was essentially a list of books in print. By searching their microfiche by publisher they could tell you if a particular book was in print. Eventually this information became available on CD-ROM. Obviously this information has value to the bookshops in that they can tell you whether or not you can get the book. The cost of subscribing to microfiche was fairly high; subscribing to the CD-ROM version only slightly less so.
Much more valuable is a stock system which can tell you instantly whether or not the book is in stock, linked to an on-line system which can tell you if the book exists, where it is available from, the cost and delivery time. This information has far more value than the other two systems, but probably actually costs quite a bit less. It is always up-to-date and stock levels are accurate.
We are so used to this system that we cannot envisage what frustrations and inconvenience the older systems gave. The new system is certainly value for money.