Information

Needs & Role

Contents
Introduction Meaning Definition Characteristics Needs Role Conclusion

Introduction
Information is of critical importance for setting up, running, survival and prosperity of a business organization.

Information is also imperative today as it enables an organization to gain and retain competitive edge.

Meaning
Information is data that is collected, collated, processed, logically organized and analyzed so as to be of use to the decision maker. In simple words, Information is processed data that is used in decision making process.

Definition
Data that has been processed into a form that is more meaningful to the recipient and is of real or perceived value in current or prospective actions or decisions. Davis & Olson

Characteristics
Improves representation of an entity Updates the level of knowledge

Has an element of surprise

Reduces Uncertainty Aids in Decision Making

Stored Data

Data
(Input)

Processing

Information
(Output)

Fig. Information Generation

Information Needs
Information is needed or required by all the levels of Management for decision making purpose i.e. at the Strategic Level Tactical Level Operational Level

Unstructured Non-Programmed Futuristic Approximate External Top Management Structured Programmed Historical Exact Internal Operation Management

Fig. Information Needs of Different Levels of Management

Role of Information
Information, Information Technology and the resultant Information Revolution are changing the rules of the game and creating new paradigm shifts, giving companies new ways to outperform their rivals. Thus the new role of information can be studied under :-

Functional Uses
Strategic Uses

Functional Uses
i. ii. iii. Information helps organization to enhance: Quality of their operations Quality of their products Quality of their services Information can help simplify:

i. ii. iii.

Products Product Processes Production Cycle Time

Information helps lower cost in any/all parts of Value Chain. Information enables organizations to command a competitive premium.
Information helps organization

i. Meet Benchmarking Standards ii. Improve Customer Service iii. Improve quality and precision of design and product.

Strategic Uses

Information gives organization new ways to outperform work.

Information helps in making precise development of strategies, planning forecasting and monitoring. Information facilitates a more comprehensive analysis and add value for/ to: 1) Problem Solving
2) Decision Making

Information enables organizations to Think Globally and Act Locally.

Information yields strategic opportunities and enables change the rules of competition very fast and bestows competitive advantage.

Information helps organizations to acquire strategic flexibility. Information enables organizations to restructure workflows. A firm can use four basic competitive strategies to deal with the competitive forces

i. ii. iii. iv.

Product Differentiation Focused Differentiation Developing right linkages to customers and suppliers Developing a low cost product without compromising with quality.
It is where Information helps an organization in gaining competitive advantage.

Conclusion
Information is a strategic resource It is scarce, has significant cost and has alternative uses bestowing competitive edge to the organization which possesses it.