CHAPTER 6 : VALUING ORGANIZATIONAL INFORMATION

ORGANIZATIONAL INFORMATION

Organizational information comes at different levels and in different formats and "granularities".

Information granularities refers to the extent of detail within the information (fine and detailed or coarse and abstract). 

Employees must be able to correlate the different levels, formats, and granularities of information when making decisions.

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.
  Example : withdrawing cash from an ATM, making an airline reservation, or purchasing stocks.

Analytical information

• encompasses all organizational information, and its primary purpose is to support the performing of managerial analysis tasks. 
• Analytical information includes transactional information along with other information such as market and industry information.
• Example : trends, sales, product statistics and future growth projections.

THE VALUE OF TIMELY INFORMATION

Real-time information = immediate, up-to-date information.

Real-time systems = provide real-time information in response to query request.



THE VALUE OF QUALITY INFORMATION

five common characteristics of high-quality information:

Low-quality information example :

Recognizing how low-quality information issues occur will allow organizations to begin to correct them. The four primary sources of low-quality information are :

1. Online customers intentionally enter inaccurate information to protect their privacy.
2. Different systems have different information entry standards and formats.
3. Call center operators enter abbreviated or erroneous information by accident or to save time.
4. Third-party and external information contains inconsistencies, inaccuracies, and errors.

UNDERSTANDING THE COSTS OF POOR INFORMATION

Bad information can cause serious business ramifications such as:

• Inability to accurately track customers, which directly affects strategic initiatives such as CRM and SCM.
• Difficulty identifying the organization's most valuable customers.
• Inability to identify selling opportunities and wasted revenue from marketing to nonexisting customers and nondeliverable mail.
• Difficulty tracking revenue because of inaccurate invoices.
• inability to build strong relationships with customers- which increases buyer power.

UNDERSTANDING THE BENEFITS OF GOOD INFORMATION

• high quality information improve the chances of making good decision.
• increase an organization's bottom line.
• high quality information to make solid strategic business decision.

                  ******** END OF CHAPTER 6 ********

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