Definition of Information
Information is any entity or form that provides the answer to a question of some kind or
resolves uncertainty. It is thus related to data and knowledge, as data represents values attributed to
parameters, and knowledge signifies understanding of real things or abstract concepts.[1] As it
regards data, the information's existence is not necessarily coupled to an observer (it exists beyond
an event horizon, for example), while in the case of knowledge, the information requires a cognitive
observer.
Information is conveyed either as the content of a message or through direct or indirect observation.
That which is perceived can be construed as a message in its own right, and in that sense,
information is always conveyed as the content of a message.
Information can be encoded into various forms for transmission and interpretation (for example,
information may be encoded into a sequence of signs, or transmitted via a signal). It can also
be encrypted for safe storage and communication.
Information reduces uncertainty. The uncertainty of an event is measured by its probability of
occurrence and is inversely proportional to that. The more uncertain an event, the more information
is required to resolve uncertainty of that event. The bit is a typical unit of information, but other units
such as the nat may be used. For example, the information encoded in one "fair" coin flip is log2(2/1)
= 1 bit, and in two fair coin flips is log2(4/1) = 2 bits.
Business information is one of the three main segments of the information industry. The other two
segments are scientific, technical and medical (STM) and educational and training content.[citation needed]
Where much of the content industry revenues are advertising-driven, the business information
segment remains largely driven by paid content, either via subscription or transaction (pay-per-view).
The primary forms of business information include:
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News
Market research
Credit and financial information
Company and executive profiles
Industry, country and economic analysis
IT research
Information comes from a wide variety of sources, in varying shape and form, with numerous qualities.
Communicated in time, being fit for purpose, and containing the right level of detail it becomes critical in
decision making. Although there is contrast between the value and cost of information,
As defined in the Business Dictionary, information is, “Data that is accurate and timely, specific and
organized for a purpose, presented within a context that gives it meaning and relevance, and can
lead to an increase in understanding and decrease in uncertainty”.
Once prepared and, structured accordingly, data becomes information. Information adds value, and once
facts and figures have been organised into information it has meaning, intended to be interpreted.
Information gathering may be performed internally, within an organization, collecting information on sales
performance, production output, or maintenance reliability. It may also be accomplished externally,
outside the organisation, harvesting information on markets, competitors and customers. Information is
valuable because it can affect behavior, a decision, or an outcome.
For example, if a maintenance manager is told the reliability of the fleet has weakened, they may use this
information as a reason to increase the maintenance budget or up-skill and further develop the
maintenance engineers. However, information is considered valueless if matters remain unchanged,
following its consumption.
Gathering information is crucial to the success of an organisation. However the information must
be valuable. It must meet certain criteria:
Timely - the information must be at hand and up-to-date, as timing can be vital.
Objective - the information should be unbiased. Information could be gathered from someone with an
ulterior motive which clouds the truth and will affect decision-making.
Accurate - the information must be correct and truthful.
Appropriate - the information must be fit for purpose. Sales data on all products may not be as valuable
as sales data on a particular product which is underperforming in certain markets.
Available - the information should be easy to access.
Complete - the information should have no omissions.
Concise - the information should highlight the key points and not be verbose. Decision makers have busy
schedules and do not always have time to read lengthy reports.
Cost effective - the information should provide value for money or else it is redundant.
Sources of information
Businesses need to know what is happening out in the world of consumers and competitors. Things do
not always stay the same. People have tastes, trends and fashions that change over time or overnight.
Companies have to gather information from various sources.
Primary information
This is information gathered first hand by the business. This will be fit for purpose and up to date, but will
be expensive to collect. Methods of collecting primary information include: surveys, interviews,
observations, focus groups and hall tests.
Secondary information
This is information that has already been collected. This information is cheaper to find and will have many
more sources. However the information gathered may not be appropriate or relevant to the organisation’s
needs, and may be out of date. Methods of collecting secondary information include the internet,
newspapers and magazines, market research reports such as MINTEL and Key Note, and government
publications.
Internal information
This is information which is only available to the business. This information will be private and accurate.
Internal information may take the form of sales figures, personnel records, customer records, and
financial documents such as trading, profit and loss accounts and the balance sheet.
External information
This is information which comes from outside the business. This is gathered via mainly secondary
information methods such as newspapers and magazines, the internet etc.
What are the different types of information?
Verbal Information - The best way to comunicate but not always the most efficient. It is immediate
and can solve most problems. Verbal Verbal information is literally face to face which is seen as the best
way to communicate. This way there is less scope for misunderstanding and it allows for verbal and nonverbal messages.
Written Information - Can be words, diagrams, graphs and charts. Can come from a wide range of
sources - newspapers, books, trade journals and government publications.
On-Screen Information - Information may be produced on-screen. This can be seen in multimedia
TV and CD-ROMs that combine text, graphics, animation, audio and video.
Multi-Media Information - This means multiple forms of media integrated together. Media can be
text, graphics, audio, animation, video, data etc. An example could be a webpage with interactive
guide and narration.
Web-Based Information - This displays many benefits of multimedia technology. Today's fast
broadband speeds allow you to stream sophisticated content to a computer anywhere in the world.
This allows somebody to access this information wherever they are. This can also be accessed by
smartphones. What examples of web-based information will John Lewis use when creating a
Christmas advert?
What are the different purposes of information?
Information collected and gathered by a business has different uses. It would be helpful for
the information to be used in many ways:
Reliable and valid information is essential to all businesses and organisations. Without this reliable
information a business will have no idea of where it stands in its market, its financial and sales
figures or how to proceed in the future. Organisations use information for a variety of purposes.
Updating knowledge - It is vital that businesses keep up to date with changes within their markets.
Information is required so that businesses know:
- how their markets are developing
- how labour markets are changing
- what the economy is doing
- what new laws are being passed that might affect the way they operate
All of this information helps organisations to make accurate decisions based on full knowledge.
Incorrect decisions are likely to be the result of inadequate information.
Informing future developments - A business that does not adapt, develop and grow will quickly find
itself left behind by the competition. But developments need to be based on informed decisions. A
business will not release a new product unless it has evidence that it will sell
Offering competitive insight - Businesses need to be aware of what their competitors are doing, to
ensure they do not fall behind and lose sales and market share. Regular research and communication
should help a business to assess its competitors' sales, marketing and development activities.
Communicating sales promotions - Businesses use a variety of information and methods to
communicate sales promotions to customers. They place information about products, services and
special offers on their websites, and have newspaper and journal adverts, and television and radio
adverts. Good market research information will offer an insight into the behaviour patterns of
customers and their buying motivations. Information can therefore help businesses to promote thier
goods and services and to sell more effectively.
Inviting support for activities - Information is required in order to support business activities. This
information must be communicated to all staff. This support may have to come from people inside or
outside of the organisation. E.g. A business may wish to change the way it operates (efficiency, fair
trade etc) and it must have the support of its workforce. The information must be clearly explained
with reasons to the staff.
Monitor and control
Financial information such as sales fugures and budgets would be used in this way as it
offers a way for a firm to take corrective action if there are issues or problems that may
arise.
Assist decision making
When the decision makers in the business (the shareholders/owners and the managers)
have to make an important decision, they need high quality information. This is true in
many aspects of management such as developing a new product, entering a new market,
deciding on equipment or software to purchase, or even when it comes to recruiting new
staff.
Measuring performance
Are sales targets being met? If not where are the branches or stores that are not
performing? Once these issues are highlighted there may be ways to turn these
performance issues around. Performance will be compared with previous years and/or with
companies of a similar size or in the same market. Ratios are useful for comparing
performance.
Identify new business opportunities
Is there a gap in the market to be exploited? Information must be gathered constantly on
customers and competitors to look for changes or trends in the market that the firm can
target.