Toward a Policy Framework for Business Information Resources Management
| Published date | 01 January 1987 |
| Date | 01 January 1987 |
| Pages | 5-8 |
| DOI | https://doi.org/10.1108/eb057463 |
| Author | T.C.E. Cheng |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
Toward a Policy
Framework
for Business
Information
Resources
Management
by T.C.E. Cheng
Faculty of Business Administration,
The Chinese University of Hong Kong
Introduction
If the old saying "Running a business is like fighting a battle"
is not exaggerating, it is a more truthful description of
today's business than in the past. Business today is
conducted in an extremely competitive and throat-cutting
environment. This tense competition, whether originating
locally or from abroad, is not only increasingly posing a
threat to a business's profitability, but also to its very survival.
In order to improve the chances of survival, managers of
current business concerns have largely taken heed of the
advice of investing for higher productivity. This has resulted
in huge amounts of capital being channelled to acquire
highly complex and advanced technologies, such as
automated manufacturing processes and sophisticated
business systems. A common feature of these productivity
improvement tools, both hardware and software, is that they
are invariably computer based. In other words, they
essentially rely on a computer which is capable of
processing large quantities of data at high speed and
accurately. These raw data, when appropriately processed,
compiled and presented as various kinds of information, will
become very valuable resources to the manager. This is
because the manager always requires accurate, relevant and
timely information to enable him to be successful in the
management decision process.
The aim of this article is to define business information
resources and their importance in a business organisation.
Unlike other resources, such as raw material, capital and
manpower which are in short supply, business information
resources are rather inexpensive and virtually unlimited in
supply. Of course, this statement is made on the assumption
that effective management policies are established and
faithfully followed by those who are responsible for their
implementation. Naturally, these policies should take
advantage of the low-cost computing hardware and
software and data communication equipment currently
available for gathering and processing data in an efficient
manner, so that useful information is always available to
support management decision making at the right time, in
the right place, of the right quality and at reasonable cost.
This discussion will concentrate on the information
requirements of the manager for planning, organising, co-
ordinating and controlling business operations. Some of the
approaches to business information resources management
will be touched on. Policy guidelines in the context of
planning,
organising and control will be suggested.
Data and Information
Every business, be it private or public, a corner shop or a
multinational, profit oriented or non-profit oriented, is
concerned with processing data, or facts, about its
operations in order to supply the management with current,
accurate and reliable information. Management decisions,
regardless of nature and scope, are based on data such as
market statistics, operating costs, inventory levels and other
factors, both quantitative and qualitative. The profundity,
timeliness and accuracy of the factual information at the
disposal of the manager can give a business a considerable
edge over its competitors.
However, raw data are as much a resource as raw materials
and minerals which are not of much use before they are
processed.
While processing of raw materials includes
transformation of the materials to change their size, shape,
physical and chemical properties, processing of raw data
means comparison, classification, analysis and summarisation
of the data so that they become usable information and of
value to management.
Although the terms data and information are used
interchangeably in everyday life, a distinction must be made
between them in order to appreciate the value of information
to management as a kind of resource. According to the
International Federation for Information Processing (IFIP)[1],
the formal definitions of data and information in a technical
context are as follows:
Data: A representation of facts or ideas in a formalised
manner, capable of being communicated or manipulated
by some process.
Information: The meaning that a human expresses by or
extracts from data by means of the known conventions
of the representations used.
Thus,
the relation of data to information is that of raw
materials to finished products. However, the definition of
information in the technical context is rather limited in scope.
Therefore, we will further define information in the context
of business management as a form of processed data
conveying to the receiver meaningful messages which are
of value in actions or decisions. Thus, the value of
information is recognised in a specific decision and in
motivation,
model building and background building
affecting current and future actions and decisions.
Business Information Resources
In order for a manager to be effective in running a business,
he/she needs to have a clear understanding of the policies,
goals,
plans and programmes of the organisation. These are
IMDS • JANUARY/FEBRUARY • 1987 5
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