With digital transformation in the construction industry, data, big data, IoT, information, Knowledge, data warehouse and there are many other words that are new to the industry but almost popular. Therefore, this post is an attempt to share the basic details on what Data, Information and Knowledge Management are.
Data, Information and Knowledge Management
While hardware and software are the first two components that make an information system, without data, it is not an information system (Bourgeois, 2014). Although technology is easy to acquire by anyone, a firm needs to know how to utilize data to create a competitive advantage. If a company leverage data for their strategic management and decision-making process then that will bring benefits for the company. However, many organizations do not use the available data to their advantage (Gallaugher, 2015). This discussion post is about data, information, and knowledge and how each of these contributes to organizational competitive advantage. Further, I will also discuss the role of data and data management solutions in organizational decision making.
Raw pieces of information that don’t have context are referred to as data. Data can be either quantitative or qualitative. Qualitative data is in descriptive form and quantitative data is available as numerical values and figures (Bourgeois, 2014). To utilize data for the decision making process, it is important to convert those into information (Gallaugher, 2015).
When data is presented in a context that can be used in decision making or if that can answer a question, it is called information (Gallaugher, 2015). In this stage, when data becomes information it reaches a complex level with integrated context (Pieper, 2017).
When information is processed, linked, and stored by a human or by a machine then information becomes knowledge. This knowledge is utilized for decision making process (Pieper, 2017). Therefore, knowledge is a collection of information about a person or a fact that makes it possible to make decisions or solve any issue (Pieper, 2017). Knowledge is also defined as the meaningful links which people make in their minds by utilizing information and its actionable applications in a specific setting (Liew,2007).
Contribution of data, information and knowledge to organizational competitive advantage
While data is not useful until it is converted to information, the information is used to make strategic and important decisions by using the knowledge. In today’s competitive market, organizations need to find ways to gain a competitive advantage (Phocas Software ,n.d.).With available technological tools, it is easy to use data to convert into information that is helpful in decision making process. There are many different ways that a company can use data to convert into information and by processing with the knowledge to gain a competitive advantage. Information will provide better consumer insights to an organization. For example, business intelligence tools can be used to recognize the customers purchasing patterns and their interests. With this knowledge, a company can come up with strategies to keep customers with their brand (Phocas Software, n.d.). Similarly, information can be used to increase productivity. Information created using data analytics tools improve the efficiency of managers where the decision making process is faster. That creates better customer relationships in a situation such as customers look for advice regarding products (Phocas Software, n.d.).Similarly, companies can utilize information processed with the knowledge to create a competitive advantage which impacts the growth of the company.
Role of data and data management solutions in organizational decision making
Information systems transform data into information that can be used for decision making process by utilizing the knowledge. For this function, data need to be collected, create information, and provide tools for analysis. A database which is a collection of organized information is used for this purpose (Bourgeois, 2014).
A data management processes identify the internal pain points of an organization and resolve those for a better customer experience. A business is able to measure the amount of data using data management solutions. Interaction between network infrastructure, APIs, security protocols, software applications, and much more data management allows managers to look at the big-picture of a business and helps with the planning & decision making process (Talend, n.d.).Whenever possible, a company can automate the decision process to improve efficiency. Solution configuration, yield optimization, routing or segmentation decisions, corporate or regulatory compliance, fraud detection, dynamic forecasting, and operational control are some areas the decision making process can be automated using a data management system (Watson, 2007). Since most management decision situations are not structured, it is not possible to completely automate the process. However, a company can find solutions for using data and data management solutions in their organizational decision making process to improve efficiency and better decisions.
Data and data management solutions help the organizational decision-making process by bringing benefits to the organization. A company can utilize data, information, and knowledge to create a competitive advantage over its competitors. Although unstructured decisions can’t be automated, companies can consider automation for most of the structured decisions.
Bourgeois, D. T. (2014). Information systems for business and beyond. Saylor.org. Licensed under Creative Commons Attribution (CC BY) License. Retrieved from https://resources.saylor.org/wwwresources/archived/site/textbooks/Information%20Systems%20for%20Business%20and%20Beyond.pdf
Gallaugher, J. (2015). Information systems: A manager’s guide to harnessing technology. Licensed under CC-BY-NC-SA 3.0.Retrieved from https://2012books.lardbucket.org/books/getting-the-most-out-of-information-systems-v1.3/s15-the-data-asset-databases-busin.html
Liew, A. (2007). Understanding Data, Information, Knowledge And Their Inter-Relationships. Journal of Knowledge Management Practice, Vol. 8, No. 2,. http://www.tlainc.com/articl134.htm
Pieper, S. (2017). What is the difference between data, information and knowledge?. Artegic. https://www.artegic.com/blog/difference-data-information-knowledge/
Phocas Software. (n.d.). How information gives companies a competitive advantage. https://www.phocassoftware.com/business-intelligence-blog/how-information-gives-your-business-a-competitive-advantage
Talend. (n.d.). What is Data Management?. https://www.talend.com/resources/what-is-data-management/
Watson, R. T (Ed.). (2007). Information systems. Global Text. Licensed under Creative Commons Attribution 3.0. Retrieved from https://my.uopeople.edu/pluginfile.php/1275982/mod_resource/content/2/Text%20-%20Watson%20Information%20Systems.pdf
Disclaimer: This article was created using a paper written as part of the MBA program.
Also read: implications of Moore’s law