Data is raw. It simply exists and has no significance beyond its existence (in and of itself). It can exist in any form, usable or not. It does not have meaning of itself. For example, a sentence that “It is raining.” is only representing a fact. In computer parlance, a spreadsheet generally starts out by holding data.
Information is data that has been given meaning by way of relational connection. This "meaning" can be useful, but does not have to be, ex. The temperature dropped 15 degrees and then it started raining. In computer parlance, a relational database makes for information from the data stored within it.
Information for Decision Making
Decision Making can be classified by organizational level, corresponding to the strategic, management, knowledge, and operational levels of the organization.
Figure 2 --- A Model of Management
Strategic decision making determines the objectives, resources, and policies of the organization. Decision making for management control is principally concern with how to carry out specific tasks specified by upper and middle management and establishing criteria for completion and resource allocation. Operation control decision making determines hoe to carry out the specific task set forth by strategic and middle-management decision maker. Knowledge - level decision making deal with evaluating new ideas for product and services, ways to communicate new knowledge, and ways to distribute information throughout the organization. Unstructured decisions are those in which the decision maker must provide judgment, evaluation, and insights into the problem definition. Structure decisions, by contrast, are repetitive and routine and involve a definite procedure for handling them so that they do not have to be treated each time as if they were new. Some decisions are semi-structured; in such cases, only part of the problem has a clear-cut answer provided by an accepted procedure. See Figure 3 (http://e-learning.mfu.ac.th/mflu/1203371/chapter3_3.htm)
Figure 3 ---Different kinds of information systems at the various organization levels support different types of decisions.
Meanwhile information plays a very important role in making decision. Here is a figure that represents information in different level of decision making.
Figure 4--- Information for Decision Making (Perry, http://itsy.co.uk/ac/0405/Sem1/44222_ISD/Lec/5_OpsInfo.ppt)
Now I will discuss the characteristics of information in the different level of system.
Information in Operational system
Definition
Operational systems deal with the day-to-day operations of an organization, such as assigning employees to tasks and recording the number of hours they work, or placing a purchase order. Operational activities are short-term in nature. Operational systems are used by supervisors (first-line manager), operators, and clerical employees. E.g. TPS. (Bolloju, Davison, McLean, Turban & Wetherbe, 2002, p. 58)
Information in this level mainly provides supervisory managers to develop short range plans.
Operational information characteristics
- Pre-specified
- Scheduled
- Detailed
- Frequent
- Historical
- Internal
- Narrow focus
(Keogan, 2003)
Characteristic of Information in Transaction processing system (TPS)
The systems that support the core business processes or functions have many names e.g. quantity-oriented operative systems (Scheer, 1998) and online transaction processing systems (OLTP) (Chaudhuri & Dayal, 1996). Laudon & Laudon (2000) call these systems transaction processing systems (TPS). They are basic computerized information systems that support organizations in their daily work and they are closely associated with the production of goods and services (Chaudhuri & Dayal, 1996; Alter, 1996). They perform and record routine transactions and give immediate feedback to decisions that are made during processing (Alter, 1996). Examples of transactions performed are; sales order registration, payroll, customer record keeping and stock account registration. (Strand, www.his.se/upload/20931/Chapter2.pdf)
Let’s look an example of system to see how information in the TPS. This is a figure that how a payroll system work.
Figure 5 --- A symbolic representation for a payroll TPS
(Laudon & Laudon, 2000)
We can see the data in the payroll master file is all the basic information of every employee. Those are all only data, all pre-specified. Like most of TPSs, the input information is transactions or events. Then during the processing, the system does something like sorting, listing, merging, or updating the information that inputted. In this case Payroll system did this job. After processing, the system usually output the information like, detailed reports, lists or summaries. That can help the supervisors (first-line manager) to conduct of the business.
Information in Knowledge Management
What is Knowledge Management?
The next level of information systems is aimed to support knowledge and data workers in organizations. Laudon & Laudon (2000) define knowledge workers as people in organizations, who work with creating new information and who integrate this new information to form knowledge. In contrast, they define data workers as people in organizations whose work is to use and manipulate data, which already exist within the organization. Knowledge workers use knowledge work systems (KWS), whereas data workers use office automation systems (OAS). KWSs are utilized by domain experts when modeling data or performing simulations, whereas OASs concentrate on performing office specific tasks, such as document management or report creation. Laudon & Laudon have chosen to categorize these systems as knowledge-level systems.
Characteristic of Information in knowledge work systems (KWS)
Let’s look at the KWS. As I mention above, the KWS are mainly used by knowledge works, like technique staff and professionals. They are responsible for finding or developing new knowledge for organization and integrating it with existing knowledge. They must keep abreast of all developments and events related to their profession. They also act as advisors and consultants to the members of the organization. Finally, they act as change agents by introducing new procedures, technologies, or processes.
Knowledge workers can be supported by a large variety of information systems. Such support systems range from Internet search engines that help them find information and expert systems that support information interpretation, to computer-aided design and sophisticated data management systems that help them increase their productivity and quality of work. Knowledge workers are the major users of the internet. They need to learn what is new, to communicate with corporate managers and colleagues, and frequently to collaborate with knowledge workers in other organization. Knowledge workers need to learn and relearn.
Information in Tactical decision management
Definition
The category above knowledge -level systems is called management-level systems and is broadly classified into the following types of systems; management information systems (MIS) and decision support systems (DSS) (Laudon & Laudon, 2000). They have as their main objectives to support middle managers in their work and to help them with their analysis of how the work is performed in organizations. Management-level systems typically provide middle managers with periodic reports rather than instant information from operations and transactions performed in the processes and function within organizations (Laudon & Laudon, 2000).
Management-level systems are broader in scope than operational-level systems, but like operational systems, they use mainly internal sources of data.
Characteristic of Information in Management Information System
Management information systems are, to some degree, solely using data that originates from within the organization (from the TPSs). This is figure of how MIS obtain their data from the organization’s TPS.
Figure 6 --- How management information systems obtain their data from the organization’s TPS (Laudon & Laudon, 2000)
From the figure, we can see the input of MIS is summary transaction data, high-volume data or simple models which are from the TPS of the organization. Then the system will do some processing like routine reports, simple models or low-level analysis. After processing, the summary and exception reports are given to middle manager who deals with the activities such as short-term planning, organizing, and control base on the reports.
Information in Strategic decision management
Definition
The highest level of information systems within organiz ations is categorized Strategic-level systems and consists of executive support systems (ESS) (Laudon & Laudon, 2000). Other labels for this type of system are found in the literature and most common is that of executive information systems (Scheer, 1998; Alter, 1996). However, ESSs are aimed to support companies in their work of analyzing trends and performing long-term planning, both within the organization but also versus their environment. This is done in order to assess whether changes in the environment matches current organizational capabilities. The planning and trend analysis horizon varies, but a five-year horizon is common.
Strategic information characteristics
- Ad hoc
- Informal
- Unscheduled
- Summarized
- Infrequent
- Forward looking
- External
- Wide Scope / Boundary Free
- Qualitative (opinions, judgments, insights and observations) and quantitative
(Keogan, 2003)
Characteristic of Information in Executive Support System (ESS)
ESS is an information system at the strategic level of an organization that addresses unstructured decision making through advanced graphics and communications. This figure is a model of typical ESS. (Laudon & Laudon, 2000)
Figure 7 --- Model of a typical executive support system.
Thought this figure we can see that the information we inputted are aggregate data; internal and external. Internal Data is from the organization like TPS, MIS and so on. And External Data is from the outside of organization. Both of data put in to system for processing. After processing, the projection are given to senior manager which can make long-rang planning.
Production of more information in each of these areas is worthwhile.
Different levels of system need different type of information. It is not worthwhile to product more information in each of these level. The data at the operational level is detailed in order to support operational personnel with information needed and the data has therefore a low level of consolidation. In contrast, data at the strategic level is more consolidated, allowing decision-makers to access more general and aggregated data (Laudon & Laudon, 2000). And the data sources in operational level system are mostly internal. They are all recorded from the day-to-day transaction. And the data sources in strategic level system are internal and external combination. Managers make long-term decision not only considering the information from the organization, but also need information from outside of organization like stock market, internet news, etc. So we can not say that more information is better for decision. Only useful information for different level can make the system effective. This is a table of the characters of Information Source and Presentation in different level system.
Figure 8 --- Information Source and Presentation (Liao, http://www.im.ncnu.edu.tw/~dyliao/MIS_2.ppt)
So if we put the consolidated information in operational level, it will not help first-line manager to make decision. Opposite, the useless information will waste time and make the system less effective.
Section 3
Conclusion
As I discussed above, the information has become the most important element in the each level of organization. It help manger to make decision from day-to-day to 5-years operation plan. But in each level of organization, the characters of information are different. The information in the lowest level, operational-level-system, is a low level of consolidation and from internal data. But in the strategic-level-system, most of information are used both internal and external sources. Concerning the type of transactions performed, Operational level transactions are typically static as they concern predefined and simple operations, such as checking a stock amount or retrieving an order (Chaudhuri & Dayal, 1996). In contrast, transactions performed at the strategic level are often dynamic and of a more ad-hoc nature.
Though the characters of information are different, they are all important for manager to make decision. So in the 21st century, your organization will become blind, if without information.
Bibliography
Alter, S. (1996), Information systems – a management perspective. 2nd Edition, Menlo Park: The Benjamin/Cummings Publishing Company, Inc.
Chaudhuri, C. & Dayal, U. (1997), An Overview of Data Warehousing and OLAP echnology ,
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Da-Yin Liao, 2001, Lecture 2 Information Technology Concept and Management [online], Available: [20 NOV, 2004]
Eraim Turban, Ephraim McLean, James Wetherbe, Narasimha Bolloju & Robert Davison, (2002), Information Technology for Management – Transforming Business in the digital economy, 3rd edition, John Wiley & Sons, Inc.
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Laudon, K. C. & Laudon, J. P. (2000), Management Information Systems – Organisation and Technology in the Networked Enterprise, 6th Edition, Prentice Hall
