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Assessing Your Organization’s Information

Published
  • March 28 2003, 1:00am EST

For the last eight months, the attention and energy that I normally place into writing my monthly online column was diverted into designing and co- chairing DCI’s Enterprise Analytics, Business Intelligence and Data Warehousing conferences. I may be overly ambitious, but I plan to resume my monthly column while co-chairing the DCI conferences this year. I have found that the experiences that conference attendees shared with me are representative of the information issues that confront many professionals and organizations. I believe you will find these experiences interesting and relevant.

Information as an Organization’s Asset

While information may not be recognized as an asset by generally accepted accounting principles (GAAP) unless there is purchase, merger or acquisition transaction that provides for independent valuation of the acquiring asset, information must be treated as an asset and, as such, utilized for the benefit of the organization and appropriately safeguarded. Bill Gates, chairman and chief software architect for Microsoft, once said, “Virtually everything in business today is an undifferentiated commodity except how a company manages its information. How you manage information determines whether you win or lose.” Assessing your organization’s information is a step toward realizing the value of this asset.

Information Needed for Reporting, Analysis and Decision Making

Managing an organization, business unit, department, group or event requires access to information in order to monitor activities and assess performance. Trying to understand what information your organization has can be challenging because the oftentimes disparate information systems collect and process vast amounts of data in various forms. However, an information assessment addresses the business and data requirements that support the reporting, analysis and decision-making capabilities of individuals within the organization. These requirements must be collected and documented so that the team is conducting the information assessment understands the scope of the project. The following decision-tree diagram highlights the important elements that business/technical analyst must consider when conducting and information assessment. (See Figure 1.)

Large image: click here to open in a new window.
Figure 1: Assessing Your Organization’s Information

When assessing an organization’s information, the following items must be addressed:

Relevant Information

Understanding what information is needed for reporting, analysis and decision-making purposes is critical to assessing an organization’s information assets. Business and data requirements must be collected from individuals who need access to this information. While the process can be time-consuming, it defines the scope of the data that is considered necessary for reporting, analysis and decision making.

Just as important as defining the business requirements is documenting the data that is collected, whether it is internally generated or purchased from a third party, so that everyone involved with the project knows what data is available for reporting, analysis and decision making.

The intersection of available data and business requirements identifies what information is currently relevant and should be considered an asset.

Format of Data

The format of the data is important to the organization’s information assessment and to the overall strategy for creating a digital repository of information for reporting, analysis and decision-making purposes. Individuals collect data in various forms: from information hand written on paper to information manually entered and processed by a transactional system. Data is data no matter what form it is captured in. While an individual can manage data in various forms such as digital (e.g., data that is stored in binary form – bytes as opposed to an electronic image), electronic or print/handwritten media, an organization comprised of many individuals needs to have information in digital form for efficient sharing, reporting, analysis and decision making. As information systems replace manual business processes within an organization, efficiencies are achieved through the automation of work effort and the access to data which is stored in digital format. Once these efficiencies have been obtained, greater benefits are derived from the analysis of data collected from these information systems. As an organization grows in headcount, the number of activities undertaken or revenue, the amount of data processed by individuals and information systems also grows.

Several years ago, a large school district approached us about developing a data warehouse to satisfy their information needs. The objective of the data warehouse was to provide the school district administrators with information about student attendance by school and grade level in hopes of improving student attendance. Funding provided by the State Board of Education to school districts is directly associated with student attendance. If student attendance improved, the school district would receive more funding. Upon further discussions with representatives of the school district, we discovered that the approach to capturing student attendance varied by school. The most sophisticated schools had a Microsoft Access database while others had spreadsheets. The least sophisticated schools, which happened to be the majority of them, tabulated student attendance manually using paper and pencil. Since the data was not all in digital form, we discussed the prerequisites for warehousing data and recommended that a transactional system be selected to capture student attendance data and deployed to the entire school district. As they considered various software applications for student attendance, we felt that they would find a software product that would help them achieve their objective without the need to develop a data warehouse.

Data Quality

The quality of data will have a tremendous impact on how the information collected is used by the organization. Individuals shy away from poor quality information for decision-making purposes. The poorer the quality, the less valuable the information. One individual that I met found himself in a situation quite the opposite of the school district example previously discussed. His company was a manufacturer of high-technology equipment with well-established information systems. They were struggling to understand who their customers were, what product(s)/service(s) they purchased and how much revenue they generated for the company. They had six information systems that separately collected this data. Integrating it was difficult due to the poor quality of the data; it included inconsistent naming standards and incorrect spelling of customer names. In order to realize any value from this information asset, a project was undertaken to cleanse the data and integrate it so that comprehensive analyses could be performed on customer information.

Timeliness

Another important component in assessing your organization’s information is the timeliness or availability of the data for reporting, analysis and decision-making purposes. While having relevant and accurate data is important, the value of information diminishes if it is not available or updated when it is needed. The time lag between the need to have information and when it is available can be costly to an organization. Another individual that I met experienced just such an issue with the timeliness of their data. For this organization, sales forecast data took several weeks to compile. By the time the sales information was available, four to five weeks had already passed. They found that after they implemented a reporting solution that increased the timeliness of information, they were able to respond faster to business issues as well as monitor the impact of their decisions; activities that they could not do before.

Conclusion

Assessing your organization’s information provides the foundation for creating and realizing value from this asset. If you want to win in this competitive environment, you have to manage and realize the value of your information. Relevant, accurate and timely information is essential for reporting, analysis and decision-making capabilities. Through the use of information, good decisions can be made, thereby, leading your organization to success.

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