INFORMATION TYPE & FLOWS

Learning Objectives

 

At the end of this chapter, you should be able to:

 

1.   Describe some of the characteristics data types and information flows in various types of business.

2. Show how these different information requirements result in different computer solutions.

3.  Show why data volume and performance requirements are important in defining system architecture.

 

Learning Outcomes

 

1. To be able to differentiate the data types and its usage in business environment.
2. To be able to justify the relation of data and computer system architecture.

 

 

INTRODUCTION

 

 

Data and Information

Most people use the terms data & information interchangeably. But data & information are not the same.

Information flow - Normally, items of data have to be related to one another to provide information for the next level up in the organisation structure. Thus, the major information flows in the organisation follow the line structure; instructions pass down from management and information flows up to management.

Data are raw facts and figures in isolation. These isolated facts and figures convey meanings but generally are not useful by them. For example, A, H, ,34, 26, 56.68,VISHAL, SCHOOL etc.

Data are processed to form information. Data are processed in various meaningful ways to form information. For example, ‘Prasad, whose enrolment no. is 270173002, has been certified in Sr. Secondary examination of National Open School’ is an information as it conveys some meaning.

Data and Information Types

 

There are many different ways of classifying information and data.

 

*        Data types by function

*        Management information types, based on management usage

*        Levels of information, based on where the user resides in the        hierarchy of the organization

*        Formal and informal information

 

Data types by function

 

In order to understand the information and hence data requirements of an organization, it is first necessary to understand the functions – or major areas of activity that are required to run the organization such as Finance, Production, Marketing, Personnel etc.

 

Management Information Types

 

Typically, four types of information are required:

 

·                    Internal company performance (sales, production, personnel, stock turnover, cash flow, etc)

·                    Internal plans (sales forecasts, budgets, etc)

·                    Environmental (political scene, social climate, economic trends, technological developments)

·                    Competitive (demand for the product or service, competitor’s performance and plans)

 

Levels of Information

 

·                    At top management level, information tends to be ill-structured, ad-hoc, informal, external, uncertain and concerned with the future.

 

·                    At middle management level, information is more structured, formal, internal, regular, certain and concerned with the near future

 

·                    At supervisory management level, information is repetitive, programmable, largely internal and has a very short time horizon

 

Formal and Informal Information

 

Formal information tends to flow along the lines of the organization chart vertically. It is usually standardized in a rational way and structured to meet job needs; it is often inflexible to short-term changes, it makes use of mechanical aids, and is usually specified by designers.

Informal information is personal and directed to the recipient as an individual rather than a post. It is not standardized or rational but reflects subjective judgments and perspectives. It is communicated on an ad-hoc basis and so is more flexible. It is not capable of mechanization, and it grows idiosyncratically as part of the users dealings with other individuals.

 

Business Use of Information

 

·                    Real-time systems will usually have to meet fluctuating demands with peaks of traffic at certain times of the day.

 

·                    A fast response to random transactions may require larger RAM and hard disk and faster hardware. If a slower response can be tolerated, transactions needing the same program can be queued and processed as a block. This will depend on the variation in transaction types.

 

·                    A study of the data flows needed within an organisation for its computer system must place different response-time values on different functions and different locations. These will be determined by economics and by the mechanisms needed for control.

 

Data and Information Flows

 

Vertical information flows between people up and down the hierarchy of the organization. Studies suggest that instructions (decisions) are slow in getting down the hierarchy but do usually arrive fairly accurately. Conversely, most people at the bottom of the hierarchy feel that information flow up from the bottom (because of filtering etc) is poor and that top management does not receive a correct picture of the events or needs at the bottom of the hierarchy.

 

Horizontal information flows between people at similar levels in the hierarchy, for example, the sales order office will check credit with the sales ledger department and stock levels with the stock records office. Often horizontal information flows are informal and include interaction such as rumors and gossip.

Data Integrity Requirements

 

Data, and hence information will be of little value unless it is:

 

·                    Accurate

 

·                    Complete

 

·                    Timely

 

·                    Consistent

 

·                    Secure

 

If the information provided by the data cannot be trusted, then the faith in the system providing it (using whatever mechanism) will be undermined.

 

Data Throughput and Performance

 

The main performance measure of the modern IS based around response time to the user. Response time is affected by:

 

·                    the system’s capacity to search for or process a certain volume of data in specific time window, which in turn is influenced by the type of file-handling device used

 

·                    and by the data communications technology used to transmit the data in one or both directions between the user and the location of the data being accessed

 

It is possible to examine the various available system configurations to work out the cost of having different response times. However, the true value of the different response times should also be considered. This is more difficult because so many intangibles are involved. It is not easy to put a monetary value on customer satisfaction, up-to-date management information, or the ability to respond promptly to market demands.