chapter 6 valuing organizational information. 2 learning outcomes describe the broad levels,...
TRANSCRIPT
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CHAPTER 6
Valuing Organizational Information
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Learning Outcomes
Describe the broad levels, formats, and granularities of information
Differentiate between transactional and analytical information
List, describe, and provide an example of each of the five characteristics of high-quality information
Assess the impact of low-quality information on an organization and the benefits of high-quality information on an organization
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Overview
Employees must be able to obtain and analyze the many different levels, formats, and granularities of organizational information to make decisions
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• withdrawing cash from an ATM• making an airline reservation• purchasing stocks
• shipping an order• daily sales• employee payroll
Transaction information examples
its primary purpose is tosupport the performing of daily operational tasks
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Analytical information examples
its primary purpose is tosupport the performing of managerial analysis tasks
• cost/benefit analysis• sales forecast• market trends
includes transaction information,external organizational information
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ad-hoc decisions a business might base on analytical information
building a new plant hiring or reducing workforces introducing a new product
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The Value of Timely Information
Timeliness is an aspect of information that depends on the situation Real-time
information – means immediate, up-to-date information
Real-time systems – provide real-time information in response to query requests
Real-time systems can help organizations make faster and more effective decisions
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The Value of Quality Information
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Low-quality information example
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The four primary sources of low-quality information
1. Online customers intentionally enter inaccurate information to protect their privacy
2. Information from different systems that have different information entry standards and formats
3. Call center operators enter abbreviated or erroneous information by accident or to save time
4. Third party and external information contains inconsistencies, inaccuracies, and errors
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Potential business effects resulting from low-quality information
Inability to accurately track customers Difficulty identifying valuable customers Inability to identify selling opportunities Marketing to nonexistent customers Difficulty tracking revenue due to inaccurate
invoices Inability to build strong customer relationships
– which increases buyer power
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The Benefits of High-Quality Information
High-quality information can significantly improve the chances of making a good decision
Good decisions can directly impact an organization's bottom line
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Opening Case Questions:Searching for Revenue - Google
1. Determine if Google’s search results are examples of transactional information or analytical information
2. Describe the ramifications on Google’s business if the search information it presented to its customers was of low-quality
3. Review the five common characteristics of high-quality information and rank them in order of importance to Google’s business
4. Explain how the Web site RateMyProfessors.com solved its problem of low-quality information