Chapter-2-Information and knowledge

Information and knowledge : 

Information and knowledge Prof Bindu Rajappa

Learning Objective : 

Learning Objective Differentiate between Data, Information and Knowledge Effective Information Presentation Quality of Information Classes of Information Application of value concept to information Human as information processes Difference between Tacit and Explicit knowledge

Information Concepts : 

Information Concepts Data – Raw material – Facts & Figures Information – Processed Data Characteristics of Information: Improves representation of an entity Updates the level of knowledge Has a surprise value Reduces uncertainty Aids in decision-making.

Conceptual Model of Communication : 

Conceptual Model of Communication The MIS is equivalent to the transmitter (encoder) which provides information and sends through reports (channel) to the various receivers The poor quality of an information due to various factors, is equivalent to a ‘Noise’ and a ‘Distortion’ in the communication model.

Information Presentation : 

Information Presentation The methods used for improving communication are summarization and message routing The concept of summarization is used to provide information which is needed in the form and content The principle behind summarization is that too much information causes noise and distortion, i.e., confusion, misunderstanding and missing the purpose The summarization suppresses the noise and the distortions.

Information Summarization : 

Information Summarization

Message Routing : 

Message Routing The principle is to distribute information to all those who are accountable for the subsequent actions or decisions in any manner If the information is generated with a certain purpose for a primary user, then such information may have secondary purposes to some other users in the organization Knowledge is a power and an intelligent person can misuse this power to achieve personal goals undermining the functional and organizational goals.

Bias in Information : 

Bias in Information While choosing the appropriate method of communicating information, a care has to be taken to see that it is not biased Many a times the data and the information are suppressed but the inferences are informed, with no or little possibility of verification or rethinking The presentation of the information will generate a bias any may influence the user The bias, which may creep in inadvertently because of the information system, can be talked by making the design flexible.

Methods to Avoid Misuse of Information : 

Methods to Avoid Misuse of Information

Contd., : 

Contd.,

Attributes of the Information : 

Attributes of the Information

Contd., : 

Contd., Redundancy is the repetition of the parts or messages in order to circumvent the distortions or the transmission errors It is sometimes considered as an essential feature to ensure that the information is received and digested.

Information: A Quality Product : 

Information: A Quality Product The quality of information can be measured on four dimensions: utility, satisfaction, error and bias The utility dimensions has four facets – the form, the time, the access and the possession The form, time and the access are subjective and it would vary from user to user Therefore, satisfaction is one common key for measuring the quality An error is the third dimension of the quality of the information.

Contd., : 

Contd., The errors creep in on account of various reasons: An incorrect data measurement An incorrect collection method Failure to follow the prescribed data processing procedure Loss of data or incomplete data Poor application of data validation and control systems A deliberate falsification.

Parameters Impacting Quality : 

Parameters Impacting Quality The parameters of good quality are: Impartiality, validity, reliability, consistency and age Impartiality: An impartial information contains no bias and has been collected without any distorted view of the situation Validity: The validity relates to the purpose of the information and depends on how the information is used Reliability: It is connected to the representation and the accuracy of what is being described.

Contd., : 

Contd., Consistency: The information must relate to a consistent base or a pattern Age: The currency of the information makes all the difference to the users. Maintaining these parameters at a high degree always poses a number of problems These problems are in the management of the operations, the sources, the data processing and the systems in the organization A failure to maintain the parameters to a high degree affects the value of the information to the decision maker.

Classification of the Information : 

Classification of the Information According to John Dearden of Harvard University, Information can be classified as: Action vs. No-action information Recurring vs. Non-recurring information Internal vs. External information

Contd., : 

Contd., Action versus No-action Information: The information which includes action is called an action information. The information which communicates only the status is a no-action information. Example: ‘No stock’ report and store transaction report Recurring versus Non-recurring Information: The information generated at regular intervals is a recurring information and ad-hoc basis is a non-recurring information. Example: monthly sales report and financial analysis report.

Contd., : 

Contd., Internal Versus External Information: The information generated through the internal sources of the organization is termed as an internal information The information generated through the Government reports, the industry surveys, etc., is termed as an external information The action information, the recurring information and the internal information are the prime areas for computerization and contribute qualitatively to MIS.

Organization and Information : 

Organization and Information Source of Information External Internal Low Structured Information High

Levels of Management : 

Levels of Management

Classification of Information : 

Classification of Information The information can also be classified as under, in terms of its application: Planning Information: Standards, Norms and specifications are used in the planning of any activity. Example: time standards, design standards Control Information: Reporting the status of an activity through a feedback mechanism When information shows a deviation from the goal or the objective, it will induce a decision or an action leading to control.

Contd., : 

Contd., Knowledge: A collection of information through the library reports and the research studies builds a knowledge base as a source for decision-making A organization data warehouse stores knowledge Information is classified based on its usage as: Organization Information Database Information Functional or Operational Information

Value of the Information : 

Value of the Information Problems of Decision-making can be solved under certainty, risk and uncertainty A decision-making situation is of certainty when the decision maker has full knowledge about the alternatives and its outcomes. This is possible when perfect information is available The information is called a perfect information, if it wipes out uncertainty or a risk completely, which is a myth.

Contd., : 

Contd., Decision theory stipulates that the value of the additional information is the value of the change in the decision behavior resulted by the information, less the cost of obtaining the information If the additional information does not cause any change in the decision behavior then the value of the additional information is zero. The value of the additional information making the existing information perfect (VPI) is: VPI = (V2 – V1) – (C2 – C1)

Contd., : 

Contd., In MIS, the concept of the value of information is used to find out the benefit of a perfect information If the value is significantly high, the system should provide it. If the value is insignificant, it would not be worth collecting the additional information The decision at the operational and the middle management level, the value of the additional or new information is low At higher levels, the value of additional information is very high.

General Model of a Human as an Information Processor : 

General Model of a Human as an Information Processor

Contd., : 

Contd., A decision-maker uses his sensory receptors, to pick up information and transmit them to brain for processing and storage The capacity of a decision-maker to accept and process inputs to produce outputs is variable and limited Filtering is a process whereby a manager selectively accepts that much inputs, which his mental ability can manage to process.

Methods of Filtering : 

Methods of Filtering

Contd., : 

Contd., The filtering process blocks the unwanted data which doesn’t match the frame or reference The information processor establishes the filters based on experience, knowledge and knowhow The choice of filters may be changed due to stress, urgency of decision-making and the confidence in a particular method of decision-making Many a times a processor is required to perceive, process and evaluate probabilistic information.

Contd., : 

Contd., The processor may be deficient in the intuitive understanding of the information, in the ability to identify the correlation and the causality and in the capability for integrating the information An experienced manager is a skilful information processor where he is able to change the frame of reference or select the decision-making tools for the available information He is also in a position to add more knowledge to the current information.

Manager’s Individual Differences : 

Manager’s Individual Differences The managers may come to same decision in a given situation but they may not follow the same decision process due to the cognitive style Each has his own style, a method to perceive the data, organize and process the same as per his frame of reference, confidence in the decision procedures and the time available for the decision-making The managerial ability, skills and tools play a considerable role in the cognitive style of the manager.

Summary of Information Concepts and their Implications : 

Summary of Information Concepts and their Implications Filtering: The system designer should provide filtering mechanism so that the information is not suppressed and relates to the frame of reference of the user Simon Model and its Application: The designer should attempt to provide such information that it clearly defines the problem space and also take cognizance of the user’s knowledge Codes and Representation: Coding system should be evolved that is easy to the user. Next, report the data in a simple manner.

Contd., : 

Contd., Highlighting: The designer should provide the information in such a way that the significant differences between the targets and the achievements, the standards and performance, the budgets and the actuals are highlighted Statistical Analysis: The information should provide the additional results such as variance, correlation, coefficients, and futuristic estimates and give a measure of statistical significance for the user to consider during decision-making.

Contd., : 

Contd., Format: The designer should present the information in the form or format which is complete in all respects and in which all data is processed as per the frame of reference of the user Referencing and Adjustment: The system should cover valid system boundaries and provide reference to an acceptable point (the year, the product, the norm, standard, knowledge) to make an adjustment to results or status.

Contd., : 

Contd., Cognitive Style: Each user has his own style of resolving or reconciling his internal view and an understanding of the problems or environment versus the actually perceived or seen or as it exists Learning Theory: The designer should appreciate that the user inadvertently is learning through the information and is building his knowledge set Feedback loop: This will enable the user to understand the process of decision implementation.

Contd., : 

Contd., Perceived Value of Data: The information which doesn’t have value in the current operation may have value in future requirements. Hence user should be provided access when required Information Absorption: Only the amount of information that can be grasped by the user should be provided Individual Differences: The information needs of different managers will differ based on individual’s sets and processing ability and cognitive style.

Reasons of Individual Differences : 

Reasons of Individual Differences

Contd., : 

Contd.,

Contd., : 

Contd.,

Knowledge : 

Knowledge Knowledge is the ability of a person to predict, sense, understand a situation and react to it effectively. Example: Analytical Information Knowledge could be tacit or explicit Tacit knowledge is difficult to codify, transfer and share Explicit knowledge is easy to codify, transfer and share

Contd., : 

Contd., According to Russell Ackoff, a systems theorist and professor of organizational change, the content of the human mind can be classified into five categories: Data: symbols Information: data that are processed to be useful; provides answers to "who", "what", "where", and "when" questions Knowledge: application of data and information; answers "how" questions Understanding: appreciation of "why“ Wisdom: evaluated understanding.

Knowledge Hierarchy : 

Knowledge Hierarchy Possessed by expert judgmental, not transferable Less judgmental, contextual, and can be transferred through learning Coded, contextual, easily transferable and can be shared Processed data with context and purpose. Transferable and sharable Facts and figures with no context

Organization Pyramid and Information Concepts : 

Organization Pyramid and Information Concepts