Unit 709 Strategic Management of Data and Information by sbsinesslondon.ac.uk

Unit: 709

Ofqual Reference R/617/6869

CMI SYLLABUS | LEVEL 7 STRATEGIC MANAGEMENT ANDLEADERSHIP PRACTICE V6

709 Strategic Management of Data and Information

Aims of the Unit

The use of strategic data and information supports leaders to make complex decisions and judgements which will ultimately enable an organisation to achieve its objectives.

Given the complexities of this topic, understanding how data and information can be applied strategically is an essential leadership attribute.

The aims of this unit are for leaders to see strategic management of data and information as an opportunity rather than a challenge.

Leaders will understand the strategic value and use of data and information and will critique strategies for its effective management.

The unit culminates in the opportunity to develop a strategy to improve the use of data and information in a strategic organisational context.

Key words

Data management, information management, value, usage, technology, governance, strategy, success.

Learning Outcomes

Understand the strategic management of data and information

• Learning Outcome 1:

• Understand the strategic management of data and information

• Assessment Criteria

• 1.1 Critically discuss the strategic use and value of data and information

• 1.2 Critically appraise the challenges of managing data and information in an organisational context

• 1.3 Evaluate approaches to the effective strategic management of data and information

• 1.4 Recommend a strategy to improve the management of data and information in an organisational context

AC 1.1 Critically

discuss the strategic use and value of data and information

Command Verb

Critically: Typically used to qualify verbs such as evaluate, assess, appraise, analyse and reflect. Give in-depth insight, opinion, debate, verdict based on a wide variety of sources, theory, research which may agree and contradict an argument.

Discuss: Give a detailed account including a range of views or opinions, which include contrasting perspectives.

AC 1.1 Critically discuss the strategic use and value of data and information

AC 1.1 Strategic use of data and information:

Generic roles/emerging capabilities which use data and information:

• Data science, informatics, business analysis, business intelligence/data visualisation.

• Emerging developments (e.g. machine learning, Artificial Intelligence, real time decision making, automation, data orchestration).

AC 1.1 Critically discuss the strategic use and value of data and information

Strategic value of data and information:

• Enterprise asset.

• Financial value.

• Competitive advantage.

• Development of people and/or organisational capabilities.

• Contribution to decision making at operational and strategic levels (e.g. HRM/HRD. Operations. Finance.

Procurement. Logistics.

AC 1.1 Critically discuss the strategic use and value of data and information

Strategic value of data and information:

• Product development.

• Marketing, Service delivery

• Influence on project and programme management, innovation and change management, leadership strategy.

• Value and use to organisations in specific contexts (e.g. Public, private, third sector, local national international, global organisations including legal status and levels of organisational maturity).

AC 1.1 Critically discuss the strategic use and value of data and information

Data and information:

• (e.g. Internal and external data and information in public and private domains).

• Use of qualitative and quantitative data and information.

• Text, images, numbers, multimedia, structured, unstructured, count, measurement, metrics and attribute data).

AC 1.2 Critically appraise the challenges of managing data

and information in an organisational context

Command Verb

Critically Appraise --Systematically examine information to judge its validity, relevance and merit in a particular context.

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

1.2 Challenges:

• Approaches to how data and information is acquired, created, stored, used, shared and managed (e.g. use of enterprise, process, data architectures).

• Capability of technology to support the management of data and information (e.g. legacy systems, cloud solutions (e.g. AWS - Amazon Web Services)). Capability of strategic data and information management to respond to change (e.g. organisational growth, merger, compliance, consolidation).

• Financial cost to acquiring, developing, maintaining and managing data and information (e.g. Cost of ICT i.e. licence fees, people development).

• Risk (e.g. data breaches, cyber security, Intellectual property, reputational risks, litigation, insourcing/out scouring data and information, data security, backup, hardware/software risks).

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

1.2 Challenges:

• Current and future capabilities: levels of knowledge, skills, expertise and leadership styles (e.g. Hay/McBer).

• Behavioural competences (Boyatzis, 1982).

• Future Competences (Morgan, 1985).

• Technical skill development i.e. business analysis, programming, project management (e.g. Prince 2, APM, PMI, Gantt charts, spreadsheets, simple data bases).

• Ability of people to interpret, select and weigh evidence, draw conclusions (e.g. currency, validity/relevancy, authenticity, and sufficiency).

• Organisational and information cultures (e.g. sharing, participating).

1.2 Challenges:

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

Viable Systems Model for organisation design (Beer, 1970).

The ability to use Systems Thinking: e.g. Soft Systems Method (Checkland, 1980).

Strategic Options Design and Analysis (Eden et al., 1990).

Critical Systems Heuristics (Ulrich, 1990).

Critical Systems Thinking (Jackson, 2019).

Strategic Assumption Surfacing and Testing (Rosenhead et al., 1990).

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

Governance. Legal and regulatory frameworks.

• National/international (e.g. Data Protection Act, 2018,

• GDPR, 2018.

• Freedom of Information Act, 2000.

• IS0/IEC 27000 Information security.

• ISO/IEC 20000 Service management.

• ITIL. Cobit 5)

• Protocols for accessing and sharing data (cross functional data requirements).

• Ethical practice.

AC 1.3 Evaluate approaches to the effective strategic management of data and information

Command

Verb

Evaluate: Consider the strengths and weaknesses, arguments for and against and/or similarities and differences. The writer should then judge the evidence from the different perspectives and make a valid conclusion or reasoned judgement. Apply current research or theories to support the evaluation when applicable.

AC 1.3 Evaluate

approaches to the effective strategic management of data and information

AC 1.3 Strategies for the effective strategic management of data and information:

• Approaches to data acquisition, storage, creation, usage, management, sharing (e.g. use of enterprise architectures i.e. Zachmann, eTOM, TOGAF).

• Process and data architectures (e.g. metadata models).

• Development of new ICT capabilities.

• Development of ‘Legacy’ systems. Use of Systems Development Life Cycles (e.g.Agile/RAD, SRUM, Waterfall and “V” model).

AC 1.3 Evaluate approaches to the effective strategic management

of data and information

AC 1.3 Strategies for the effective strategic management of data and information:

• Purchase of COTS packages (e.g. Enterprise Resource Planning (ERP). Materials resource planning (MRP).

• Application of current and emerging technologies for specific organisational contexts (e.g. Simple and Smart invoicing, cashless transactions).

• EDI (Electronic Data Interchange standards and protocols). Spreadsheets and software for specific business functions.

• Business to business and business to consumer technologies.

• VANs (Value Added Networks).

AC 1.3 Evaluate approaches to the effective strategic management of data and information

AC 1.3 Strategies for the effective strategic management of data and information:

• Peer to peer technologies.

• Internet and intranets.

• Blockchains.

• Cloud technologies.

• Cybersecurity.

AC 1.3 Evaluate approaches to the effective strategic management of data and information

AC 1.3 Strategies for the effective strategic management of data and information:

• Data base types (e.g. use of Relational, Hierarchical, Object, Graph, Network, Pointer).

• Technologies for Data Mining, Data Visualisation.

• Dealing with “Big Data”.

• Industry 4.0, Industry Convergence and FinTech.

• Disaster recovery, business continuity strategy, problem and service management (ITIL).

• Crisis management planning.

1.4 Recommend a strategy to improve the management of data and information in an organisational context

AC 1.4 Strategy to improve the management of data and information:

Approaches to the way data is acquired, created, stored, used, managed, shared.

Data governance (policies and procedures).

Stewardship and ownership.

Approaches to collecting/selecting/rationalising data volumes and quality (clean data).

Use of people analytics and metrics. Data Science and Informatics.

1.4 Recommend a strategy to improve the management of data and information in an organisational context

AC 1.4 Strategy to improve the management of data and information:

• Rationalisation of data formats and data definitions, data sets, data bases, technologies, applications, e.g., use of spreadsheets and COTs packages.

• Approaches tailored to strategic requirements, decision making (e.g. Reducing process waste and variation Lean and Six Sigma.

• Financial and cost analysis.

• Market segmentation.

• Customer behaviours and analytics.

1.4 Recommend a strategy to improve the management of data and information in an organisational context

AC 1.4 Strategy to improve the management of data and information:

• Product and Service costing and pricing.

• Purchasing and procurement decisions).

• Benchmarking (e.g. use of PIMS - Profit Impact of Market Strategy, EFQM Excellence Model, Baldridge Model).

Supplementary Books

• Banks, R., Thorlund, J. T and Laursen, G. (2016). Business analytics for managers: Taking business intelligence beyond reporting. Hoboken, NJ: John Wiley & Sons.

• Chaki, S., (2015). Enterprise information management in practice. Managing data and leveraging profits in today’s complex business environment. New York, NY: Springer Science + Business Media.

• Currie, W. and Galliers, B. (2014). Rethinking management information systems: An interdisciplinary perspective. Oxford: Oxford University Press.

• DAMA International (2017). Data management body of knowledge. Bradley Beach, NJ: Technics Publications.

• Earl, M. (2006). Information management: The organisational dimension. Oxford: Oxford Univ. Press.

• Eremenko, K. (2018). Confident data skills - master the fundamentals of working with data and supercharge your career. London: Kogan Page.

Supplementary Books

• Gorelik, A. (2019). The enterprise big data lake: Delivering the promise of big data and data science. Sebastopol, CA: O'Reilly Media.

• Hinton, M. (2016). Introducing Information Management. New York, NY: Routledge.

• Milner, E. (2003). Managing information and knowledge in the public sector. London: Routledge.

• Phillips-Wren, G., Carlsson, S., Respício, A. and Brézillon, P. eds. (2014). DSS 2.0Supporting decision making with new technologies. Amsterdam: IOS Press BV.

• Rosenfeld, A. and Kraus, S. eds. (2018). Predicting human decision-making. Williston, VT: Morgan and Claypool.

Information Processing & Management

Expert Systems with Applications

Journal of Enterprise Information Management

Information Technology and People

Journals

Journal of Strategic Information Systems

Information Resources Management Journal

Information Systems Management

Journal of Database Management

MIS Quarterly Executive

Information Technology and Management

Journal of Information Science

Supplementary Journals

• Journal of Software Maintenance and Evolution

• SIAM Journal on Computing

• IBM Systems Journal

• Networks

• Expert Systems with Applications

• Decision Support Systems

• Data & Knowledge Engineering

Useful External Weblinks

• Stewart Brand: How Buildings Learn: What Happens after They're Built, http://shearinglayers.com/layers/

• COBIT 5, https://cobitonline.isaca.org/

• ITIL (the IT Infrastructure Library, http://www.itil.org.uk/

• ISO/IEC 27000 (information security)

• ISO/IEC 20000 (service management)

• https://www.bcs.org/upload/pdf/business-analysis2.pdf

• TED Talks https://www.ted.com/talks

• YouTube includes topical discussions on data: https://www.youtube.com/

Identify the features of data and information

In identifying the feature of data and information you could use a range of writers and models for example Ackoff and the pyramid of data, information, knowledge and wisdom.

Reference could also be made to Nonaka’s knowledge spiral (SECI Model) and the attributes of data and information: • ● Accessibility • ● Relevance • ● Comprehensible • ● Timeliness •

Accuracy

Current

Adequate •

Timely •

Reliable •

Cost-effective

Understand the importance of information sharing within the organisation

You might make reference to models such as OODA loops –John Boyd and the different decision action cycles (DACs) required at different levels across the organisation.

You should at this level make some reference to strategic and operational decision making.

You might also make some reference to other models such as the viable systems model (VSM) - Stafford Beer and the information flows.

You might also consider organisational imperatives that might impact on the criteria for selecting data and information.

Impact of a management information system to an organisation

You might consider the use of models such as that promoted by Cashmore and Lyall who propose that information systems have 5 stages:

• ● Capture/input

• ● Routing to locations for processes

• ● Processing data to information

• ● Distribution

• ● Analysis and interpretation

Other writers might include: Laudon and Laudon and Maceviciute and Wilson who comment on environmental scanning.

Determine the legal responsibilities in sourcing, sharing and storing information

This criterion could be answered with comment on the legal aspects, some of which include:

● Confidentiality

● Authorised access for information

● Legislative requirements

● Data protection

● Individual Rights - Personal Data

● Sensitive Data

Determine the legal responsibilities in sourcing, sharing and storing information

You should further make reference to the eight principles put in place by the Data Protection Act

1998 (DPA) to make sure that your information is handled properly. Organisational frameworks may include but is not limited communication and knowledge sharing policies, procedures and protocols, safety, security, risk, reporting and audit, approval levels for access to data and information.

Legal frameworks refers to General Data Protection Regulation (GDPR) 2018, Freedom of Information Act (2000), Digital Economy Act (2017) and any other sector specific regulations.

If your organisation is in the public sector, then you may need to include reference to your responsibilities arising from the Freedom of Information Act 2000.

Discuss

when information should be offered and access allowed

A good answer would make reference to Sensitive Personal Data in terms of:

• ● Racial or ethnic origin

• ● Political opinion

• ● Religious or other beliefs

• ● Trade union membership

• ● Physical or mental health condition

• ● Sexual life

• ● Criminal offences, proceedings and conviction

Discuss when information should be offered and access allowed

And the conditions to be met before processing sensitive personal data:

• ● Explicit consent of the data subject

• ● To comply with employers legal duty/ obligation/ rights

• ● To protect the vital interests of the data subject or another party

• ● Information has been made public by the data subject

• ● Exercising for medical conditions

• ● For equal opportunities

• ● Necessary for performance of contract with data subject

• ● To protect the vital interests of the data subject

• ● To carryout public functions

• ● To pursue the legitimate interests of the organisation unless prejudicial to the interests of the data subject

Evaluate the formats in which information can be offered

A full response for this criterion could reference Laudon and Laudon; executive cockpit based on traditional data and information formats or the work of Edward Tufte on:

● Structure data

● Unstructured data

● Self-organising maps

● Spatial and non-spatial data

● For operational and strategic decision making

Analyse information to identify patterns and trends

Here you could reference Making Strategic Decisions - Post ad Anderson and also Laudon and Laudon when analysing structured and unstructured decisions.

A very considered response might further make reference the work of Edward Tufte (MIT) on patterns of data used to identify weak signals for strategic decisions contrasting this with traditional statistical methods used to identify trends, for example, pie charts, histograms, run and controls charts.

Some people may prefer to use an applied example from the workplace to illustrate the use of statistical theory.

Evaluate a range of decision making tools and techniques available to support a strategic decision

You might refer to writers such as Wendy Robson and the nature of decision making and how this relates to management information.

You could further consider the model proposed by Newell and Smith that explores how management information can be used for:

• ● Business Intelligence

• ● The Design challenge

• ● The strategic information challenge

• ● Choice

Evaluate a range of decision making tools and techniques available to support a strategic decision

Other writers might also include Marchand who proposes a strategic information alignment framework:

● Operational

● Competitive

● Strategic Used for:

● Command and control

● Improvement

● Opportunities for synergy

● Environmental opportunities

Some reference might also be made to Senge’s ladder of inference when making decisions.

Determine the sources available to assist in analysing data and information

Chaffey and Wood who identified some of the sources available to assist in analysing the data and information available to an organisation for strategic and operational decision making in terms of:

• ● market and customer information

• ● specialist knowledge

• ● business process information

• ● management information and plans

• ● human supplier information

• ● Accountable information, along with business and market intelligence

A strong answer may also provide brief example of how sources are applied in organisational data analysis

Methods of evaluating management information within an organisation

Your response could include writers such as Cashmore and Lyall who identified three levels of business environmental information flow:

● External

● Internal

● Corporate

A full response could critically review several methods of evaluating management information within an organisation in terms of the three levels reviewing both diagnostic and analytical methods available to an organisation.

Methods of developing information capture to inform and support strategic decision making

Here you are asked to provide an evaluation of more than one method of developing information capture to inform and support strategic decision making and present this analysis in table format illustrating the strengths and weaknesses of each approach.

Some of the methods evaluated could include:

● Questionnaires

● Surveys

● Focus groups

● Marketing campaigns

● Environmental scanning

● Desk top research

A carefully considered response might also differentiate between qualitative and quantitative data and information capture.

Processes for analysing impact of information on strategic decisions made

In a discussion of the processes for analysing the impact of information on strategic decisions made, you could use the context of your organisation.

A full response might discuss the role of environmental scanning and how this is used to inform policy formulation, making some reference to the different Decision Action Cycles needed across their organisation.

There is no “perfect” strategic decision. One always has to pay a price. One always has to balance conflicting objectives, conflicting opinions, and conflicting priorities. The best strategic decision is only an approximation—and a risk

-- Peter Drucker

INFORMATION MANAGEMENT

"To achieve effective information management, organisations will need to pay greater attention to managing soft knowledge, such as tacit knowledge, judgement, and intuitive abilities (Anand et al., 1998)."

The concept is created to help practitioners better understand the notion of information management, its history, practical use, implementation strategy and limitations.

Information Management Definition

Information management (IM) is the process by which relevant information is provided to decision-makers in a timely manner (Davis, 1997). Information management has largely been defined from an information systems perspective and equated with the management of information technology. IM is a generic term that encompasses all the systems and processes within organisations for the creation and use of corporate information. IM aims to get the right information to the right person at the right place and at the right time (Robertson, 2005).

• Figure 16.1 Top management’s role in organizational strategy and organizational design

• Source: From Organizational Behaviour 1st edition by Daft, 2001. Reprinted with permission of SouthWestern, a division of Thomson Learning: www.thomsonrights.com.

Fax 800 730–2215. Adapted from Arie Y. Lewin and Carroll U. Stephens, ‘CEO attributes as determinants of organization design: an integrated model’, Organization Studies, vol. 14, no. 2, 1994, pp. 183–212

Strategic information planning

To manage strategic information an organisation needs an information systems strategy plan to ensure that information is available for its strategic decision-making. Huff and Beattie in Galliers and Baker identify two types of systems that can provide strategic information for decision- making.

The authors go on to discuss that any strategic information systems planning (SISP) should be closely associated with the business planning process. But they highlight problems that can occur if too much focus is placed on technological rather than business, management and organisational issues. They also highlight the need for ‘gaining appropriate commitment to and involvement in SISP on the part of senior and middle management’.

• Business and information strategies

•Cashmore and Lyall suggest that it can be helpful to consider how information strategy can be derived directly from the business strategy. The following diagram builds on a well-known strategic tool first developed by Johnson and Scholes.

•This can be a helpful framework for determining how information can be used to support strategic decision-making, in that the information strategy can be formulated with these goals in mind.

• Martin (in Cashmore and Lyall) suggests that strategic planning for IS consists of three aspects:

• strategic business planning

• strategic information technology planning

• strategic data planning.

•The authors suggest this can be a helpful framework as it separates the key challenges of strategic business and data planning from the fast-changing information technology planning aspect.

An information systems strategy plan

Robson suggests that an information systems strategy plan should achieve two things:

■ Clearly identify where IS intends to go and so avoid the danger of ‘getting lost’ — taking courses of action that don’t contribute to the overall mission.

■ Provide a formalised set of benchmarks so that progress on this journey can be monitored.

She goes on to identify three key components to the IS strategy plan:

■ A clear statement of the IS objectives that gives a sense of direction where the organisation wishes to be.

■ An inventory and assessment of both the current organisational capabilities and problems resulting from current practices — where the organisation is now.

■ A concrete implementation plan that translates the sense of direction and knowledge of the start point into a navigable route map — how to get from the first point to the second.

Robson concludes that the IS strategy plan is necessary to direct future IS resource allocations. If information is needed to support strategic decision-making, this needs to be reflected in the IS strategy plan.

High-level decision making

• Strategy is often linked to high-level decision making within the organisation. Johnson et al suggest that strategic decisions have the following features:

• They relate to the scope of an organisation’s activities

• They involve matching the activities of the organisation to the environment in which it operates.

• They involve matching activities to resources and in particular the resource capacity

• They have major resource implications

• They affect the operational decisions that the organisation takes.

• They impact on the values and expectations of the stakeholders in the organisation and will have a significant effect.

• They are likely to have longer-term implications

• Making strategic decisions

•It is hard to make good decisions. Youneed fast access to huge amounts of data, the ability to evaluate variousmodels and a way to visualise the problem and the solution. Various levels of tools are available to help. The tools provide different types of intelligence and support. As a manager you need to understand the context of the problem and know which tools can be applied to solve a problem. You also need to beenough of an expert to recognise when a system providesuseless or bad answers so that you can avoid disasters.

•The above quotation, written by Post and Anderson, provides an overview of the challenges facing managers whenmaking business-related decisions. They suggest that managers facea variety of different decisions but to help managers analyseproblems and make the right decisions they can usetools and models. These tools can be applied to tactical and strategic decisions.

Models These can be used for:

an understanding of the process

optimisation

prediction

simulation.

They can be developed via tools such as spreadsheets or purposebuilt software.

Tool How used?

Data warehouse

Decision support systems

This can be used to find and retrieve data and then analyse it. A data warehouse is a specialised database that stores data in a clean format that’s easy to read and analyse.

The data is normally extracted from transactional data and stored separately so that managers don’t get bogged down with masses of information. Other tools such as decision support systems (see below) can be used to query data for analysis and reporting.

There are three key processes involved with data warehousing: extraction, transformation and loading (ETL).

A decision support system (DSS) consists of three components:

■ data retrieval

■ model evaluation

■ visualisation of the results.

A data warehouse is often used as the data source for retrieval. The model is often developed by experts (consultants) and evaluated into a spreadsheet. The visualisation component generally consists of charts and graphs but could involve other representations for complex problems.

They can be used in two key areas of a business:

■ marketing forecasts to develop a sales forecast

■ human resources management to calculate pay rises.

Data mining This tries to build on the data warehousing concept and make it easier for managers to obtain relevant information quickly.

Data mining consists of tools and techniques that automatically retrieve and search data for information. It finds comparisons in a mass of data and looks for relationships. It can be helpful when considering correlation, such as how one variable affects another. For example, which variable price or advertising method would have the greatest impact on sales revenue.

Making strategic decisions

Data mining Another helpful technique is clustering, where data mining finds groups of items that have similar values, such as the agegroup most likely to buy a particular product.

One of the latest techniques is called market basket analysis, where data mining techniques are used to determine which items are normally associated witheach other. This is used by online retailers such as Amazon and Marks & Spencer to discover items that might be purchased together.

Expert systems

These work on the principle that knowledge from experts (people with specialist knowledge) is captured and made available to other workers in the organisation by using IT.

Expert systems have their mostvalue in solving narrow, specialised problems. They can be complex but have to be well defined.

Their two main applications are to help with:

■ diagnostic problems — identifying the causes of defects

■ speedy decisions — approving a finance request.

Both applications work on the basis of the expert system asking a series of questions. Depending on the answers given, it will react accordingly. The questions will have been captured from real-life experts and this knowledge is codified within the system.

It can be helpful to ensure the consistency of business decisions such as compliance with rules and regulations.

It can also be valuable for training employees. If the tasks are complex and decisions unstructured, it can be difficult for employees to learn rules.

• How to make decisions

• Laudon and Laudon identify two types of decisions managers makein organisations:

•■ Structured decisions: These are mainly operational decisions which are repetitive or routine and havea definite procedurefor handling them. An example of a structured decisionwould be how to deal with a cost overrun.

•■ Unstructured decisions: These are more strategic in nature where the decision-maker must provide judgement, evaluation and insight into the problem definition, and there’s no agreed procedure for making such decisions. An example of an unstructured decision would be how to launch a new product into a new market.

•These definitions are helpful when considering which information would support strategic decision-making. From these definitions, strategic decisions are more likely to be unstructured ones. Thereforethe decision-maker needs the judgement, evaluation and insights to make these types of decisions.

•Laudon and Laudon also highlight the value of somethingcalled an ‘executive support system’. They define this as ‘information systems at the strategic level of an organisation designed to address unstructured decision- making through advanced graphics and communications’. Executivesupport systems (ESS)combinedata from internal and external sources and senior executives can use them to do the following:

monitor organisational performance

track activities of competitors spot problems identify opportunities

• ■ forecast trends.

How to make decisions

A practical example of an ESS is the ‘management cockpit’. This is defined by the authors as follows:

… an ergonomic concept for structuring and visualising firm performance indicators using easy to understand displays. The display is based on SAP’s Enterprise Management module which uses web technology to provide management with a comprehensive view of firm performance.

An example from a pharmaceutical company is shown below.

Another name for these are ‘management dashboards’. They provide senior managers with quick, easy-to-access information and allow the manager to drill down to explore the lower-level, operational data behind them.

BALANCED SCORECARD

• "Successful strategy execution has two basic rules: understand the management cycle that links strategy and operations, and know what tools to apply at each stage of the cycle (Kaplan and Norton, 2008)."

• This concept offers a practical guide to using the Balanced Scorecard and is designed to assist executives to benefit from this strategic management technique.

• Balanced Scorecard Definition

• The Balanced Scorecard (BSC) is a strategic management technique for communicating and evaluating the achievement of the mission and strategy of the organisation using both financial and non-financial measures (Drury, 2004).

The balanced scorecard could be used as a basis for developing a management dashboard or ‘cockpit’. The advantage of using this framework for such a purpose is that the measures and indicatorsare often strategic in nature and provide a good overview of how the organisation is performing both strategically and operationally.

Financial perspective Customer perspective

Objective: increased profitability

KPIs: economic value added, gross margins, return on sales, cost reduction

Objective: improved customer satisfaction

KPIs: customer feedback, customer complaints, delivery times, response time

Internal perspective Innovation and learning perspective

Objective: streamlined processes

KPIs: reduced waste, reduced unit costs, improved sourcing, product quality

Objective: continuous improvement

KPIs: number of employees on training, improved quality in product delivery, quantity of employee suggestions, sales per employee

• Balanced Scorecard

•The balanced scorecard is another method of combining qualitative and quantitative measures — financial as well as strategic perspectives — to translate strategy objectives into measurable performance. The perspective of the scorecard is fourfold: financial, customer, internal and innovation and learning. The measures are the key performance indicators (KPIs) for each objective.

Identify your competitors

Check your competitors’ home pages for positioning changes

Review the trade shows they participate in

Create a competitive intelligence database of white papers and webinars (a seminar carried out over the web, often involving both visual and voice elements)

You may know the existing ones but new firms may have emerged. Or a firm may have repositioned a product or serviceand are a new threat.

Look to see if they’ve made changes to descriptions of products and services such as features and benefits.

Review their website and record dates and events they are going to participate in.You might want to attend.

These are on the increaseand tracking these can give you intelligence about organisational direction or positioning.

• Competitive intelligence

•Chari suggests that it’svital to know what your competitorsare doing. You need to undertake activities that relate to the gathering and analysis of competitive intelligence. You should also monitor the broader market place for any developments that might affect your organisation,its products and services, customers, suppliers and distribution channels.

Check who they are hiring and firing

Check the management team information and search job postings. Look for new names added or old ones removed. Often this information is not announced.

•Chari suggests that tracking your competitors for information can be helpful in spottingtrends and patterns and recommends the active monitoring of competitors’websites as a way of achieving this. He then goes on to identify five activities that an organisation must do regularly to track its competitorsand uncover important information that may be helpful in identifying patterns and trends.

• Competitive intelligence

•Early indicators: Another technique for analysing patterns and trends is using early indicators. Early indicators are a performance measure that help predict patterns and trends and add value to forecasting. They can provide advance information for a later performance measure. Recklies highlights theirpopularity as being the following:

• ■They can provide objectivity to traditional forecasting processes.

• ■They are often based on external data from trustworthy sources, which adds value to their perception.

• ■You can often use early data as a predictor for later events. But Recklies discusses some downsides to this approach:

•■Sometimes it’s difficult to identify a suitable early indicator for a particular forecast and also demonstrate a correlation, for example, does a 50 per cent increase in the indicator lead to a 50 per cent increase in revenue or profits?

• ■Often managers demand or expect one early indicator for the whole business. It often needs one per product or business unit.

• ■Early indicators are more effective towards the later stages of the value chain product sales rather than suppliers of raw materials.

• ■Early indicators often have a limited life-time and may need to be regularly reviewed.

• Recklies suggests that the ‘one early indicator for the whole business’ approach is flawed and proposes a selection based on the following data:

• general economic

• your industry

• the customer’s industry

Improving information quality

Management information quality can be defined as a number of key aspects such as knowledge and the quality of actions and results. Chaffey and Wood define information quality as ‘The suitability of information for the purpose required by its users’. So if you apply this definition to management information, it would suggest that management information needs to be suitable for the purpose required by managers, such as in strategic decision- making. It’s not as straightforward as that though and there’s often much discussion and debate about what is suitable and what the purposes are.

Chaffey and Wood propose a process for improving information quality which can provide a helpful framework for monitoring and reviewing management information quality.

• DIKAR Model

•Chaffey and Wood suggest that the DIKAR model can be helpful in understanding the attributes of management information quality. It looks at the three key terms explored earlier in Sections 1 and 2:

• data

• information

• knowledge. There are two more:

• action

• results.

• The DIKAR model is shown below.

•

• DIKAR Model

•Applying the model, you can see that for strategic decisions it focuses on the attributes relevant for knowledge, action and results

•he authors go on to discuss that the flow of the model can be reversed and converted into a results quality driven version called RAKID. They quote the work of Murray who highlights the role of knowledge in actions that produce business results, and that managers often focus on the supply of knowledge rather than the desired results.

A Artefacts Anything made by people: processes, documents or tools in which knowledge is embedded

S Skills Abilities that can be trained and measured without ambiguity

H Heuristics Rules of thumb, the outcome of experience, the main repository of knowledge, mostly unarticulated

• DIKAR Model

• Knowledge quality

• Chaffey and Wood define knowledgequality in the following way:

•Knowledge quality is dependent on the capability of people to attach significance to information to informtheir decisions and the ability to convert it into information to convey to other people.

•They proposea framework called ASHEN as helpful in gaining a better understanding of knowledgequality.

E Experience Accumulated experience of failure and success which allows the right pattern to be triggered in the right context

N Natural talent Some people are just better at doing things than other people and they are often not the people you expect

•The authors proposethat the ASHEN factors can be usedto assess knowledgequality at the followingpoints:

• ■ decisions

• ■ problems resolution

• ■ solution creation

• ■ judgement

• ■ learning points. Actions and results quality

• DIKAR Model

• Knowledge quality

•Chaffey and Wood propose that the quality of actions and results are dependent on organisation performance management systems. These systems are used to evaluate and improve effectiveness and efficiency. They suggest that management information has a key role in these systems and this is illustrated in the following diagram (this appeared in the introduction to this development guide).

•Management information can be used at both organisational and individual process level. Information is used as an input for many of the processes and can also be one of the outputs. Deciding on what information to use in order to make decisions is a critical function and highlights the value of information and in particular management information. This therefore also raises the need to monitor and review information, knowledge, actions and results quality.

• Managing information quality

•To manage information quality, it’s often helpful to conduct an audit and then develop an information quality policy. The policy should take into account the people involved and their information behaviours and values.

• Management information audit

•Chaffey and Wood define an information audit as ‘An evaluation of the usage and flows of information within an organisation in supporting organisational objectives’. They suggest that management information audits are often targeted on specific information management needs such as competitive intelligence about an organisation’s market place and customers.

•They also highlight research from Orna that suggests that if a management information audit is not carried out, a possible consequence may be poor decision-making. This is because it will be difficult to bring together relevant information from a range of sources to make quick and effective decisions.

•Chaffey and Wood provide an example of an information audit carried out at the University of Glamorgan. The focus was on one particular process: the recruitment of new students. The strategic goal for this was defined as ‘Attract and retain sufficient students’. •

•

• Management information audit

• The audit process was broken down into five stages:

•1 Stage 1: Define information requirements. This involved identifying organisational objectives and the information required for achieving and monitoring progress of these objectives.

• 2 Stage 2: Assess current information provision. This analysis compared information actually available against information ideally required to achieve and monitor progress.

• 3 Stage 3: A gap analysis of the difference between information requirements and provision. This highlighted any issues between what was requested at Stage 1 and what was actually received at Stage 2.

• 4 Stage 4: Identification of potential solutions. This is where solutions to any gaps are proposed. These could be new information, new processes or new technology.

• 5 Stage 5: Develop an action plan. This involved the determination of specific action points, including the provision of information and changes to processes.

• Source: adapted from JISC (2000) in Chaffey and Wood (2005)

• The stages in the audit process could be adapted for any organisation as the underlying principles are all relevant.

•

• Management information quality policy

• Chaffey and Wood propose that an information quality policy is necessary to define the practical guidelines on managing information quality. It should include procedures to evaluate and improve information quality.

• They define an information quality policy as ‘Detailed organisational and individual approaches to reviewing, monitoring and improving the quality of information within an organisation’.

• The authors identify two key areas for the development of such a policy: information behaviour and data governance. You’ll look at information behaviour (as well as values) next.

• Information behaviours and values

•An information quality policy should outline appropriate behaviours with regards to information management. It should also make its values clear.

•Marchand et al. (in Chaffey and Wood) identified six behaviours and values capabilities and developed a set of questions for each, as shown below:

•■ Proactiveness: This is characterised by the willingness to use information in an innovative way and to monitor and respond to changes in their environment. It can be evaluated by asking whether people:

• Information behaviours and values

• Sharing: This dimension evaluates the sharing of both sensitive and non-sensitive information. Sometimes non- sensitive information is not shared since there’s a sense of loss of control, but sharing information can be of value. It can be evaluated by asking whether people:

• share information within teams

• share information across functional boundaries

• share information across organisational boundaries — with customers, suppliers and partners.

• Control: This is characterised by the use of information to manage processes and organisational performance. It can be evaluated by asking the following questions:

• Is information on business performance presented to employees and does it influence their working behaviour?

• Do they use information to improve their performance?

• Is information so scattered that it’s difficult to control people and processes (reverse scored)?

• Is information distributed on a ‘need to know’ basis, so employees know what to do but don’t know why they’re doing it?

• Formality: The main concern with formality is whether informal, potentially unreliable sources are used in preference to formal, potentially more reliable sources. Do people:

• trust informal over formal sources of information?

• use informal information sources extensively even though formal sources are available and credible?

• use informal sources to verify and improve the quality of formal information sources?

• Evaluating management information

• Two approaches to evaluating management information are using data governance and evaluating management information value.

• Data governance

• David Waddington discusses the results of research undertaken on data governance. He defines data governance as follows:

• … the process of establishing and maintaining cooperation between lines of business to establish standards for how common business data and metrics will be defined, propagated, owned and enforced throughout the organisation.

• Waddington proposes that the key function of data governance is to improve and maintain the quality of data in the business.

• Typical data that could be improved by adoption of data governance would be any data or information relating to the product, service, customer, asset or organisational structure. These are often the basic building blocks of management information systems.

• Data governance

•Though the term ‘data’ is used in Waddington’s article, this can be substitutedby ‘information’, and in particular management information, as the principles highlighted apply to both. Data governance should be considered in the formation of any management information quality policy.

• The article highlights three key drivers for data governance in organisations:

•■ The ability to use timely, reliable, trustedinformation to drive the business (78 per cent of survey respondents).

• ■ Improving the quality of business decision-making (74 per cent of survey respondents).

• ■ Ensuring consistent use of information(71 per cent of survey respondents).

•Waddington sees a trend within organisations to extend the range of data available, to move away from traditional customer and product data towards more generic business data. You might like to read the full article at this point.

•

• Value of management information

•Robson suggests thatone way of evaluating management information is to consider the value it provides in terms of management decisions. She proposes thefollowing model of information attributes.

•The above model can be helpful in that it considers the differences between operational and strategic level decisions. For someof the attributes you’ll note that there’s no difference and that the information value attribute is applicable to both levels. This model can provide a framework for evaluating management information. Youwould identify a key piece of management information and explore its value by examining it againstthe attributes, taking into consideration the decision-making level. This should lead you to identify any improvementactions required.

Using the management information value model, identify three key pieces of management information you are familiar with and evaluate these against the attributes in the model.

Attribute feature Management information 1 Management information 2 Management information 3

Timeliness (currency, response time, frequency)

Content (accuracy, relevance, completeness, conciseness and aggregation level)

Format (medium, structure and image)

Cost (cost and benefit) What improvements would improve the value of the management information?

You might like to convert this into a brief report to senior managers.

What is management information?

•When discussing management information

just what do we mean by that? Often there are three different elements being discussed:

• data

• information

• knowledge.

•Chaffey and Wood offer the following definitions for these.

Data Discrete, objective facts about events. Data is transformed into information by adding value through context, categorisation, calculations, corrections and condensation

Data is recorded each time a customer buys a ticket as part of the sales process

Data will be automatically recorded by data entry system, possibly web-based

Because of the volume of this type of data, it will have little value to managers in its current form

Data will need to be transformed into information using an information system

Information Organised data, meaningful and contextually relevant. Used for decision-making

Information from ticket sales is aggregated and summarised to produce totals and averages

Ticket sales is compared to competitors’ activities

Visualisation via charts is used to simplify thedata

A manual or paper-based system would be difficult to manage so an information technology system would be used to communicate this information around the organisation

Information will help managers answer questions about operational processes

Knowledge The combination of data and information to which is added expert opinion, skills and experience to result in a valuable asset which can be used to make decisions

Information about operational processes has little value if no action is taken

Managers will apply their skills and experience to the information accessed and received

Managers will then make decisions about how they use resources to manage processes

Knowledge is used to make judgements about unprofitable routes by acting on the information received

Attributes of information system

Attribute Definition

Accessibility

Relevance

• Wolstenholme et al. highlight the differences between management information and data

• … data itself is useless until some thought has been applied to its meaning. Adding value to raw data or unsophisticated information by human or computer effort can be consideredas one of the main tasks of management, as it is information upon which the management decision-making processes are grounded.

•They go on to identify five attributes of management information.

Comprehensibility

This is about availability. Managers need to know that the information exists and how to obtain it. They may need to call on specialist help to obtain the information. Information technology can often help facilitate speed of access and the amount of information which is accessible.

To be relevant, management information needs to have been sifted and packaged into an effective format. It’s helpful if the management information is succinct but it must always be complete. This can be a time-consuming process.

Timeliness

This relates to the understanding of the management information and the match to the needs of the decision-maker. Any deficiencies in this area could affect the quality of the decisions made with the management information.

From the manager’s perspective this is about how long a period of time there is between the request and the receipt of management information. Any delays may be caused by the management information system (MIS) itself or because of gaps in the relevance, comprehensibility and accuracy of the management information.

Accuracy

This is linked to timeliness. Time factors can introduce errors. For management information this is often a measure of the gap between the manager’s perception of the state of a variable and the true state of a variable.

Information management

The Chartered Management Institute defines information management as follows:

The acquisition, recording, organising, storage, dissemination and retrieval of information. Good information management has been described as getting the right information to the right person in the right format at the right time. The indiscriminate practice of information management can lead to information overload.

Commentators have argued that knowledge is no more than information locked up inside people's heads.

Chaffey and Wood suggest that effective information management requires careful control of three types of resource:

■ information resources such as data, information and knowledge

■ technology resources such as the hardware and software that forms information and communications technology and information systems

■people resources, such as the different types of employee and managers within a company, as well as third parties such as suppliers and customers who also determine information quality.

Information is a resource issue which needs to be managed effectively.

Information management

•Joyce Kirk (in Maceviciute and Wilson) draws the following conclusions for information management in organisations:

•■ Information management (IM) needs to encompass the full range of information, from being a resource to being a force for change and development.

•■ Information can be integrated into organisational processes and so it can influence organisational culture, structure and work patterns.

•■ IM can properly address information products, services, information flow and use in an organisation.

• ■ Useful measures of the effectiveness of IM can be based on the impact on the organisation.

• Kirk then suggest four propositions about IM.

Proposition1 Information and IM contributeto the achievement of organisational goals

Proposition 2 IM is contextualised by the organisation

Proposition 3 To be as effective as possible IM must assume a broad view of information

Proposition 4 Information can be value-laden; sotoo can IM practice

• Strategic information management

•Sue Myburgh provides a definition of strategic information management by exploring the component words. She defines strategic information as ‘information that can be used to develop a plan for success and is integral to such a plan’.Her definition of an information strategy is ‘a plan for dealing with information successfully’. Combiningall three words together leads to the definition:‘The management of strategic information to achieve organisational objectives.’

•She goes on to discuss the fact that strategic information management means different things to groups of managers within organisations.For example, managers involved in information technologyand systems would see it as the application ofinformation technology to support business processes. Managers involved more with the finances and administration of an organisation may see it more about developingstrategies rather than managing information that might be strategic in nature.

•Myburgh, however, says that it means much more than these two common views. She suggests that it helps managers respond to the following challenges facing organisations:

• ■ increasing the productivity and creativity of knowledge in workers who work with information resources

• ■ planning, implementingand evaluating the effective use of information resources within organisations

• ■ developingpolicies to maximise the benefits resulting from the widespread use of these resources

• ■ improving the strategic use of information resources in business, government and non-profit organisations

• ■ understandingICT is a tool for accessing information, and not an end in itself.

• This area is explored in more depth in Section 3, where you’ll consider how information is used to support strategic decision making.

Environmental scanning

Maceviciute and Wilson define environmental scanning as follows:

... the process whereby organisational management make themselves aware of the conditions under which the company (or public sector agency) functions — the market, the competition, the state of the economy, legislative developments, etc.

They highlight that much of this external information can be found on the web and it can provide a basis for the decisions an organisation must take with regards to its environment.

Four-mode framework for environmental scanning

Choo (in Maceviciute and Wilson) suggests a four-mode model for environmental scanning.

UNDIRECTED VIEWING

■Organisation percieves the environment as unanalysable and Information needs ill-defined

■Organisation satisfied with limited soft information and Organisation does not seek out hard data

■Information seeking is casual and opportunistic

■Organisation does not need to expend resources on formalised scanning

■Decision-making has to deal with high levels of ambiguity and uncertainty

Enacting

Conditioned viewing

■ Organisation perceives the environment to be unanalysable but intrudes into it to influence events and outcomes

■ Information required for testing and experimentation of the environment

■ Information sought from external sources and channels created by the organisation through intervention — may include collecting feedback about the organisation’s actions

■ Organisation creates its own environments

■ Organisation gathers information by trying new behaviour and seeing what happens

■ Organisation will ignore precedents, rules and traditional expectations

■ Information uses focus on actions that have been taken

■ Decision-making is process-based — organisation decides on a course of action, designs a custom solution, tries it then recycles the process if the solution doesn’t work

■ ‘Learn by doing’ mode of learning

■Organisation perceives the environment to be analysable

■Organisation passively gathers information

■Information needs are focused on a small number of well-defined issues or areas

■Information is sought using standard procedures

■Data comes from external reports, databases and industry sources

Searching

■ Organisation perceives the environment to be analysable and actively intrudes into it to collect accurate facts

■ Information needs are well-defined, broad and detailed

■ Organisation is prepared for unexpected findings, revealing new information needs

■ Organisation seeks hard, formal and often quantitative data often using rigorous surveys and market research

■ Organisation may have internal resources for environmental scanning

■ Organisation is more open and willing to update existing knowledge than conditioned viewing approach

■ Organisation believes there is a stock of knowledge about the environment that it can use for analysis and planning

■ Decision-making is based on logical rational procedures often involving analytical quantitative techniques

■ Organisation learns by investing resources in collecting information and analysisng the environment, then adjusting actions accordingly

• Three types of environmental information

•Cashmore and Lyall identify three types of business environmental information that flow in and out of an organisation which should be managed in some way.

EXTERNAL INFORMATION (INWARD FLOWING)

■Accumulated customer information — customer needs and preferences

■Technological knowhow and skills

■Distribution channels, their existence and capacity to obtain information

■Customer networks, their existence and capacity to obtain information

CORPORATE INFOMRATION (OUTWARD FLOWING)

■Reputation

■Advertising knowhow

■Marketing knowhow

■Brand names

■All of these are required to create positive information in the minds of customers about the company and its products

INTERNAL INFORMATION

■Corporate culture — style, spread and effectiveness of information flow

■Managerial skills — interpretation and responsiveness

■International management — knowledge of different cultures

Using information to support business processes

A report commissioned by the Hawley Committee and discussed in Chaffey and Wood identified the following information groupings as being important to support business processes. All of these come from some kind of internal or external environmental scanning for information:

▪ market and customer information

▪ product information

▪ specialist knowledge

▪ business process information

▪ management information and plans

▪ human resource information

▪ monitor and control operating processes for efficiency and improve them to save time or money

▪ exchange information with partners suchas suppliers as part of their operational processes

▪ communicate messages about brands and products internally and externally.

▪ From this you can see that environmental scanning and the associated management information that is collected and analysed can add real value for an organisation.

▪ Internal information which helps managers review and improve performance is called ‘business intelligence’, while external information, such as monitoring competitor activity, is often called ‘market intelligence’.

Management information and decisionmaking

Wendy Robson discusses the nature of decision-making and how it relates to management information. She refers to a recognised model proposed by Newell and Simon in which managerial decision-making can be broken down into three decision stages.

Robson discusses that each of the three decision stages has implications for management information. The following table illustrates how management information can support each of the decision stages providing a basic framework for considering management information and decision-making.

Intelligence Displaysthe current state plus danger warnings (project over budget)

Design Provides forecast and predictive models — what would happen if we reduced outsourced labour rates?

Choice Performs risk analysis on alternatives and provides feedback — what option would give us the quickestpayback?

The strategic information challenge

• Marchand (in Thompson and Martin) suggests there are four importantand distinct uses for information at the three levels of decision-making within organisations: operational; competitive; strategic.

• The four uses are detailed below.

Command and control

Improvement

■ Formal gathering of information

■ Centralised control and decentralised accountability

■ Budgeting and resource allocation typical activities

■ Helpful for managing resources but will not drive rapid change

■ Often involves tight financial targeting and monitoring

■ Organisation broken down into sub-units such as divisions or departments

■ Emphasis on integrating the functions to improve efficiency and effectiveness

■ Processes that link the functions are the focus of attention

■ May involve initiatives such as total quality management (TQM)

■ Focus on business process improvement Opportunities for organisational synergy

Environmental opportunities

■ Focus on internal synergy, sharing and interdependency

■ Team working and special project teams often used to achieve this

■ Helpful when another business is bought or merged

■ Market intelligence

■ Competitor monitoring and benchmarking best practice used to generate new ideas and opportunities

■ Requires managers to be vigilant and enquiring

■ Ideas spotted by one part of the business may be useful for another information sharing is therefore vital

■ Trust and cooperation important to ensure this happens

• Evaluate how effectively your organisation is managing these four information needs. What improvements would you suggest should be made?

Information needs How you manage them

Command and control

Improvement

Opportunities for organisational synergy

Environmental opportunities

Possible improvements

• Senge’s ladder of inference

•Senge’s ladder of inference model describes the thinking process that we go through, often without realising it, to get from a fact to a decision or action. The model can help us understand the thinking steps that can make us jump to the wrong conclusions. It illustrates how our beliefs affect what information we select and how it can lead to us ignoring some facts altogether.

•From a management information and decision- making perspective it emphasises the need to get back to the facts and use beliefs and experience to positive effect. This can help you develop more objective conclusions about what needs to be done.

What are information systems?

The UKAcademy for Information Systems defines information systems as follows:

Information systems are the means by which organisations and peop using information technologies, gather, process, store, use and disseminate information.

You’ll notice the focus on information technologies. Technology doesn’t have to be used to manage these processes but in today’s business environment the majority are. It may be that there are some manual or paper-based systems used in some organisations these are still system but are just not technology-based. In this topic we assume that the processes managed by the information systems are technology-based. Laudon and Laudon define information systems as follows:

... interrelated components working together to collect, process, store and disseminate information to support decision making, coordination, control, analysis and visualisation in an organisation.

The input component captures data from the environment or internally from within the organisation. Processing converts this data into a meaningful form, which we call information. The output component transmits the processed information to people within the organisation who use it in conjunction with their skills and experience to solve problems and make decisions.

An IS is more effective with a feedback sub-system that returns information back to the people involved with the input element.

• The purpose of an informationsystem

• Cashmore and Lyall propose thatan information system is made up of different sub-systems with different functions and

• purposes. Typical purposes are to:

• ■ collect and store data which may be converted into information at some later point in time

• ■ provide operational information to ensure thateveryone can do their job as well as possible and to assist in the general running of the organisation

• ■ extendthe value chain of the business sothatthe organisation’s information system can link with the information systems of customers and suppliers. This should result in benefits and improved information flows.

• These purposes are reflected in the following diagram.

• Cashmore and Lyall go on to discuss thatin the past the emphasis was placedon collecting and storing data. This was because of the manual nature of much of the operational andtransactional work. Intoday’s business climate, where much of this work is now processed by information technology, there is a greaterfocus on gaining good quality information that can be used for strategic purposes to gain competitive advantage.

• Information systems and the organisation

•Laudon and Laudon discuss how the interdependency between the organisationand its IS is increasing. They describe how organisationalbusiness strategy, rules and procedures are interdependent with the organisation’s IS. They suggest that changes to strategywould require changes in software, hardware,databases and telecommunications. Sometimes, existing systems can be a constraint as they limit what the organisationwants to do, without making a major investment. This interdependency can be represented in the following diagram.

• BUSINESS INFORMATION MANAGEMENT

• Chaffey and Wood suggest there are three strands to business information management, each of which has a

Strand Elements

Information resources ■ Data

■ Information

■ Knowledge number of supporting elements. This is shown in the table below.

Technology resources

•They suggest that each of these are important to the other and poorperformancein one will affect the performanceof the other two.

People resources

■ Software applications

■ Systems software

■ Technology infrastructure

■ Hardware

■ Telecommunications

■ Employees

■ Customers

■ Suppliers

■ Government

• Information transformation

•Chaffey and Wood suggest that information is transformed into value for managers in the following five stages:

• 1 Capture or input of data.

• 2 Routing of data to location for processing.

• 3 Processing of data to produce information.

• 4 Distribution of information to its users.

• 5 Analysis and interpretation of information by users, coupled with their knowledge (skills and experience)to take actions which give results.

•They also highlight activities involved in processing information and propose a four Cs framework as a helpful way to summarise these activities.

Context Displaying a data item relative to other data items, such as in a time series or trend graph. Or sorting data alphabetically or numerically.

Calculation Producing derived metrics such as calculating a percentage capacity utilisation.

Classification or categorisation Grouping information into different categories (such as all flights into a particular country).

Condensation Aggregating or totalling information to present business event data as summary information (such as total sales on a route). Filtering also summarises information (Show me all flights that were delayed by at least two hours).

Managing information as a strategic resource

Chaffey and Wood define business information management (BIM) as follows:

... the process of managing information as a strategic resource for improving organisational performance. This process involves developing strategies and introducing systems and controls to improve information quality to deliver value.

Orna (in Chaffey and Wood) discusses how vital information is for organisations:

■ It must be transformed by human cognition to be of value — information has no inherent value in itself.

■If inflows of information to maintain knowledge or support appropriate action are blocked, disaster can follow, either immediately (as in an airline flight) or as a more gradual decrease in organisational competence.

■ Where information is hoarded for the exclusive use of a limited number of people it doesn’t fulfil its potential value.

■ Information is a diffuse resource that enters into all activities of businesses and forms a component of all its products and services.

• The information life cycle

•Chaffey and Wood suggest that the management of information as an organisation resource requires management of the information life cycle.

•This emphasises a dynamic process closely linked to business processes requiringa system (or systems) to manage the information at all stages of the life cycle. This can be used to help the organisation develop strategies. (You’ll look further at this in Section 3 in relation to strategic decisionmaking.)

Strategic importance of business information management

The Marchand evaluation tool allows you to evaluate ways in which information can create value for organisations. The framework suggests that there are four main methods by which information adds business value. Some examples of how information can contribute are shown below:

Add value

■Providing better quality products and services

■Understand customer characteristics and needs

■Customer satisfaction

■Sense and respond to markets

■Trends in demands

■Competitor products and activities information on competitive pricing or introducing new products or services

Reduce costs

■More efficient business processes

■Create, market and deliver services using fewer resources

■Information technology applied to reduce paperwork and human resources needed to operate processes and improve internal and external communication

Manage risks

▪ Support functions such as finance, accounting, auditing and corporate performance management

▪ Aid strategy development and review

Create new reality

▪ Aid innovation

▪ Create new ways in which products and services can be developed

What are management information systems?

Thompson and Martin define a management information system (MIS) as something that ‘collects, processes and distributes the information required for managers to make decisions’. They suggest that the MIS should have the following characteristics: It should be cost-effective — the additional revenue or profits generated by the decisions made by using it should exceed the costs involved in designing and implementing the system. Any information it provides should be valid, reliable and up to date.

Thompson and Martin discuss the fact that sometimes the role of technology detracts from the information requirements, leading to unwanted, formal and bureaucratic systems which don’t fit the wants and needs of managers and the organisation.In some cases, organisationscan become overloaded with information that they can’t use in an effective way.

Management information systems

Decision support systems (DSS) and executive information systems (EIS)

■ Could be computer-based

■ Could be manual procedures

■ Together these strengthen the business operation

■ Include everything from routine data processing (DP) and transaction processing, through to decision-orientated support

■ A sub-set of MIS

■ Designed and implemented to provide automated support during the decision- making process, including problem awareness and definition stages

■ Sometimes these are different from other examples of MIS the organisational sensitivity of EIS

Strategic management information systems (SMIS)

■ A sub-set of MIS

■ Focused on systems considered critical to the current or future business competitiveness Information systems (IS)

■ The term IS is used to capture the various categories of system: MIS, DSS,EIS and SMIS

■ Managerial and organisational focus, not just about data manipulation

MIS components

• Post and Anderson suggest that an MIS consists of five related components:

• Hardware: the physical equipment.

• Software: a set of instructions that controls the hardware.

• People: traditionally thought of as programmers, analysts and a few users, now encompassing everyone in the organisation that inputs information or draws information as outputs from the MIS.

• Procedures: instructions that help people use the system such as user manuals and documentation.

• Data collection: probably some form of database — collections of related data that can be retrieved and processed by the technology.

• Post and Anderson also suggest that the goal of MIS is to enable managers to make better decisions by providing quality information.

The nature of management information systems

Robson describes an MIS as the instrumentation ofan organisation. They can provide visual indicatorswhich Robson calls ‘dials and gauges’ of the current state of the organisation.They monitor and provide information on activities undertaken and can also provide valuable information on any actual or predicted changes, such as the rate, direction and timing of such changes. These changes require the manager to make decisions, do nothing, do something planned or do something different. The following diagram represents the elements of a typical MIS.

Robson suggests that the instrumentation view of an MIS is a helpful approach to management of these systems, but she also emphasises the need for people-based judgements to be included — management decision-making. Typical decisions relating to the MIS might be any of the following: which activities to record which of the enterprise’s variables require monitoring what extent to monitor them in what format the ‘dials and gauges’ should display their messages.

The nature of management information systems

Robson also discusses how the levels of an MIS relate to one another.She identifiesfour levels.

Level Purpose

Transactional Producing an invoice

Operational Reporting daily sales ledger figures

Tactical Developing budgetary forecasts

Strategic Making business sector comparisons

Robson suggests these levels are important factors as they link to managerial decision-makingand therefore shape the information required by the MIS. She then identifiesfive key attributesfor an MIS.

MIS attribute Description

Decision-orientated While it’s a legitimate decision to do nothing, the system must be producing material in an appropriate way to enable informed decision-making.

Data processing Despite the shift on focus, MIS must still maintain data processing checks, controls, timeliness and efficient resource use.

Data management The vehicle should maintain the three Is of data storage: integrity, independence and integration.

Flexibility

Human computer interface (HCI)

To avoid being stuck with outdated and inappropriate technology and solutions, the MIS should be sufficiently adaptable to people’s varied and changing needs and behaviour.

The system should capitalise upon the best of humans and of machines to obtain the optimum mix of people’s intuition and a machine’s reliability and speed.

Evaluating management information systems

Robson identifies a helpful framework proposed by Benjamin et al. for assessing the impact of information systems on the organisation.

• The framework suggests that an information system can impact on an organisation in one of four ways:

• The IS can impact on the approach to the external market place by either improving traditional ways ofworking or by altering traditional ways (two ways). For example, introducing databases to collect competitor intelligence on pricing for managers to use when deciding how to cost products and services.

• The IS can impact on the approach to the internal operations, again by either improving traditional ways of working or by altering existing ways (final two ways). For example, converting a manual data entry of monthly sales figures into an automated process which collects the information automatically from the sales ledger.

• The framework suggests that an organisation should use two additional questions to uncover the strategic opportunities presented by an IS:

• Can the IS be used to make a significant change in the way i t does business and so gain a competitive advantage?

•Should the organisation concentrate on using IS to improve i ts approach to the market place, or should it centre i ts efforts around internal improvements?

•Evaluating management information systems

•Robson discusses an alternative approach to assessing the impact of IS proposed originally by Silk. This suggests that there are three generic areas that can be used. The table below shows the three areas and typical results that could be measured to determine impact.

Efficiency The introduction of IS may result in cost savings.

Effectiveness The adapting of an existing IS may result in a higher return on assets (RoA) because resources are being used more effectively, such as the organisation’s cash flow.

Strategic advantage Business growth through customers is achieved by using the IS to provide information on buying patterns.

Information system effectiveness

Galliers and Baker present a framework for evaluating the effectiveness of an IS. It considers four key focus areas:

■ personnel performance organisational performance goals system performance. It can be represented by the following diagram.

According to the framework, the effectiveness of an IS is affected by the people using the system. They need to have the right trainingin order to have the right knowledge and skills to get the best out of the system.

The organisation itself needs to have some clear measures in place. For the IS to be perceived to be of value, these affect the quality of any goals set for it, which in turn affects the system performance. This includes how long it’s designed to last which impacts on the overall IS effectiveness. This again may affect the way in which the organisation perceives the value of the IS — and the loop is repeated.

The use of data and information in decision making

Purpose may include but is not limited to knowledge sharing and collaboration, knowledge as a business asset, supporting business activities, business planning, business opportunities and organisational decision making.

Data and information may include but is not limited to Data, Information, Knowledge, Wisdom (DIKW) model (Ackoff, 1989), tacit and explicit knowledge (Socialisation, Externalisation, Combination, Internalisation (SECI) Model (Nonaka and Takeuchi, 1996), knowledge and know how (Collison and Parcell, 2004).

Tools and techniques for analysing and interpreting data and information to support decision making

• Tools and techniques may include but are not limited to strategic, tactical and operational, Cost Benefit Analysis (CBA), options appraisal, grid analysis, Decision Model (Vroom Yetton, 1973), Rational Decision Making (Kepner Tregoe, 1965), OODA Loops (c. 2000), data mining, Structured Query Language (SQL), excel spreadsheets, charts and graphs.

Data

• Data and information The words ‘data’ and ‘information’ are often used as though they mean exactly the same thing, however there is a difference.

• How would you explain the difference? Data are the ‘undigested’ facts and figures that are collected on innumerable subjects.

• Due to this, data is sometimes called ‘raw’ data, because it is untreated and is simply a series of facts, figures or characters e.g. a list of numbers with no context.

• Without context, it would be difficult to interpret or understand the relevance of these numbers, they could relate to anything!

• When data is processed in some way, for example by analysing or presenting in categories, it becomes ‘information’ which has meaning and can be used for a purpose i.e. to inform decisions.

Data

Data are facts, events, transactions and so on that have been recorded.

They are the input raw materials from which information is Produced.

Data can literally be defined as “Facts and statistics collected together for reference or analysis” (Data, 2020).

This means it is the unadulterated “raw material” that is gathered from a data source, on its own this data has no context or meaning.

When the data is given context, it becomes more meaningful and starts to answer basic questions such as “who did what”, “where was it done” and “when was it done”.

At this point data moves up the DIKW hierarchy (Ackoff, 1989) and becomes information.

DIKW model Ackoff 1989

• The DIKW pyramid, also known variously as the DIKW hierarchy, wisdom hierarchy, knowledge hierarchy, information hierarchy, and the data pyramid, refers loosely to a class of models for representing purported structural and/or functional relationships between data, information, knowledge, and wisdom.

• Jennifer Rowley (2007): “Typically information is defined in terms of data, knowledge in terms of information, and wisdom in terms of knowledge.”

DIKW model Ackoff 1989

• Data is just a set of signals or symbols. Nothing more — just noise. It may be server logs, user behavior events, or any other data set. It’s unorganized and unprocessed. It’s inert. And if we don’t know what it means, it’s useless.

• You get Information when you start to make data useful. When we apply systems to organize and classify data, we can transform this unstructured noise into Information. The “What”, “When” and “Who” question should be answered at this stage. In short, Information is data with meaning. This “meaning” can be useful, but it isn’t always useful.

• Knowledge is the next step in the journey, and probably the most significant leap. It implicitly requires learning. It means that we can take data, categorize and process it generating Information, then organize all this Information in a way that it can be useful. Whereas Information can help us to understand relationships, Knowledge allows us to detect patterns. It’s the foundation that will let us build predictive models and generate real insights. A definition that I like is that Knowledge is a mental structure, made from accumulated learning and systematic analysis of Information.

• Wisdom is the final frontier. It allows us to predict the future correctly, not only by detecting and understanding patterns but also deeply comprehending the “Why” behind those patterns. Wisdom is all about the future: it relies on Knowledge and pattern models, but it can help to shape your “gut feeling” and intuition, giving you an exponential competitive advantage. Knowledge ages quickly because of how fast reality changes, but wisdom remains more rigid. For now, this is a pure human skill, but AI is catching up fast. When AI wisdom becomes better than human wisdom, the outcomes will be unpredictable.

Characteristics of good information

relevant accurate ‘complete’ (sufficient) delivered timely appropriately detailed understandable

Approach Outline how this would be used to checking data and information against organisational needs

Accuracy Peters (2013) suggests that the best way to check accuracy of information is to compare your data against others to see if the data is consistent.

Accurate information will demonstrates the same trends when collected from multiple sources/collection methods.

Validity

Validity can be considered as “the extent to which it fulfils the needs that you have identified” (CMI, 2020).

This can be subjective and therefore difficult to measure. However you can reconfirm the validity of your information by going back to the original question and checking whether the information you now have, actually answers the question you had.

Currency Currency is entirely dependant on the information/data to hand (CMI, 2020). For example in terms of a football match, information on the score that is 5 minutes old may no longer be current, where as when reviewing tectonic plate movement information gathered several years ago is most likely still current.

Reliability The crux of checking the reliability is in ensuring that the data/information collection method collects the same results each time.

CMI (2020) states that the easiest way to check the reliability of the data/information is to repeat the collection process and see whether the results are the same.

Authenticity Kjelvik (2019) succinctly defines Authenticity as “true, quantitative or qualitative information, collected from real-life phenomena.”

The easiest way to assure information is authentic is to capture it yourself; however you can cross check information from multiple sources against each other to check for consistency. This will indicate its authenticity.

Completeness

When information is captured in a structured format, it will be obvious if the data is not complete as there will be a gap in the response. Therefore, the best way to check for completeness is to ensure that the collection method is structured in such a way that missing information is obvious to the reader.

Information value dependent on information quality

Why collect data and information?

Data and information is everywhere and provides you with the raw materials you need to do many things, for example make decisions, monitor progress and keep people up to date.

It is used constantly in our day to day lives and collecting data and information is an essential activity to support the operation of a business.

• Answering questions e.g. Gathering feedback from your customers to identify how satisfied that they are with the service that you provide to enable you to make service level improvements

• Auditing e.g. Interviewing employees and observing them whilst working to identify if they are following the correct procedures as part of your quality system

• Validating research e.g. Seeking other sources of information to ensure that the research is authentic and current.

Why collect data and information?

• For legal reasons e.g. Keeping employment records such as evidence of right to work in the country, payroll information and hours of work that may be required by Government departments such as the Inland Revenue

• Communicating e.g. Collating information on team performance to enable you to update the team on progress against team objectives and give direction on future focus

• Investigating e.g. Gathering data and information relating to the reasons for a machine breakdown to enable you to resolve the problem and avoid the problem re-occurring

• Developing business insight e.g. Analysing the business environment you operate in to identify possible opportunities and threats that may impact on your organisation

• Testing solutions and hypotheses e.g. Scenario planning to identify best case and worse case scenarios when planning a course of action

Why collect data and information? Examples

Legal Requirements – It is a legal requirement for certain types of data/information to be collected. For example, Companies Act (2006) states every company must keep adequate accounting records.

Therefore to comply with legal obligations, all companies must gather data and information on expenditure.

Communication – Data and information can be presented to demonstrate a certain point and reinforce it with ‘hard’ evidence.

Strange (2007) explains that clever use of the correct data and information can provide strength to your arguments and gain “buy-in” from others. For example when requesting additional funds to purchase new equipment, data and information can be used to demonstrate the benefits the new equipment will bring and emphasise the issues if the new equipment is not purchased.

Answering Questions – Data and information can mitigate assumptions by providing unambiguous facts in response to a question.

For example, a company may assume that customers find their product to be good value, however by gathering information directly from clients (e.g through a questionnaire) they will know for sure their clients opinions. This type of information can then be used to provide business insight (CMI, 2016) which may influence product/price changes.

Example of quantitative data and information

Unit Sales – this information is made up from number of units sold (data) multiplied by the price per unit (data) over a set period of time.

(Financial Dictionary, 2020)

Explanation of how it can be used by organisations

By understanding the number of units you are selling, and the price they are selling at, you can forecast the future turnover of the company (Berry, 2018).

However it is important to take note of any assumptions and differences between time periods such as high-demand seasons before extrapolating data to create a forecast (Berry, 2018).

Product specification information – this is hard facts about a product, for example the size, weight, capacity, expiry of the product.

It is important to ensure you fully understand what raw materials you are using within your organisation to create your products to maximise productivity, prevent errors and minimise waste (Price, 2017).

As product specifications contain all of the details of the product to be used, it is good practise to read through and check the product specification of the products you are using, to make sure it is compatible with your machinery and offers good Return on Investment (ROI).

Example of qualitative data and information

Customer preferences, motivations and interests – these will be unique to each individual, but can be grouped into generalised categories such as their concern for the environment.

Explanation of how it can be used by organisations

It is important to understand your customers driving factors and motivations and align your organisation accordingly. Bansal (2000) highlights that the main driving factor of organisations to be more ecological and “Go Green” is because this is what the customers are expecting of an “ethical” firm. By realigning policies to more ecological practises, organisations gain favour with their clients (Bansal, 2000), which will hopefully boost the organisations prosperity.

Individuals personal preferences, ability to get on with others and general cultural fit to an organisation.

This can be assessed by asking “culturefit” questions that will evidence individuals levels of empathy, team working and commitment (Anderson, 2020)

During candidate interviews it is important to assess an individuals cultural fit to the company (Anderson, 2020), as an individual with a good cultural fit will have an increased productivity and integration with their colleagues.

Information is everywhere

Information is everywhere Information… informs.

Start with that as a simple idea and the rest of the apparently complex world of information management falls into place. Information provides you with the raw materials you need to:

• make decisions

• monitor progress

• make proposals for improvements plan effectively

• keep your boss up to date

• keep your team up to date

• keep yourself up to date.

Information is everywhere

Like all raw materials, information comes from a range of suppliers, and you have to be just as careful about how you use this resource as you are about any other.

Increasingly, information is one of the keys to organisational success, and therefore one of the most important aspects of your work. You need to consider how to:

• select the type of information you need

• identify the sources of that information

• select the methods that you will use to obtain it

• store and retrieve it effectively

• use it for making decisions

• decide who needs to know

• select the communication method to best inform them

• report or present the information or outcomes to others.

Information

• One of the main developments in information is the increase in the amount that is available. Due to the internet and email, organisations and individuals are now flooded with it.

• In the days before modern information technology, the problem was that managers were often starved of essential information.

• Today, the problem is more likely to be information overload.

• The key is to get the right information, in the right format, at the right time, and to the right people.

• Types of information You may have come across the terms ‘soft information’ and ‘hard information’.

• Hard information Hard information is factual, accurate and largely provable. Two, or more, external and independent observers would agree that it is factually correct.

• It often involves accurate numbers, taken from monitoring systems. You will often see the expression ‘quantitative’ used to refer to items of information that express quantities — numbers. This is an example of information at the hard end of the spectrum.

Hard Information

• There are many examples you may have thought of here. Hard information is contained in a variety of outputs, including:

• sales figures

• lists of the numbers of employees, their qualifications and other details

• breakdowns of money spent

• budget statements

• statistics showing the level of output for each machine

• catalogues and price lists of supplies and raw materials

• marketing information detailing your services, availability and prices

• staff absences

• annual leave figures

• details or confirmation of arrangements for events and activities

• records of courses attended timetables.

Soft Information

• Soft information is often referred to as ‘qualitative information’ , or ‘qualitative data’.

• It is open to interpretation, as it expresses qualities about the matter which may be subject to how the user of the information feels about those qualities.

• Observers of the same soft information may not interpret it in the same way.

• Having access to the soft information about something will give you a wider picture of it.

Soft Information

The sort of soft information you may want could include:

• what do our customers feel about what is happening in the market — are widgets going to become popular again or is the trend towards dooberies going to stick?

• how good are our widgets compared to our main competitor’s if we are fighting for a share in a smaller market?

• what do your customers think of the brand?

None of these pieces of information are hard facts. They begin as judgements and ‘gut feelings’ that can add to the picture. They may be disputed by those with different opinions.

How information travels

You need the right information, in the right form, at the right time. That’s clear enough — but how does it arrive with you?

There are two main areas to look at here.

• The systems used for passing information around organisations — essentially, the structures set up by the organisation and its people to circulate and disseminate information.

• The methods used to communicate information — both spoken and written.

For example, an organisation may have a system based on a management hierarchy — where the ‘chain of command’ up and down is the system for circulating information.

The methods used within this system might vary according to the situation and the manager. It could involve a wide range of methods, from formal written memos, to informal face-to-face conversation . Information systems in organisations

How information travels

Start by having a look at the systems. There are many options.

Here are five examples of the most common ones.

1. Management hierarchy, where information is carried up and down through a clear chain of command and seniority.

2. Representatives, where someone acting for a group of colleagues works on inter-departmental steering groups , union/management negotiating bodies and staff representative committees.

3. Formal briefings, such as team briefings, where a consistent message is cascaded down and throughout the organisation.

4. Networking, where people with similar interests, work roles and backgrounds make links. Sometimes this is facilitated by the organisation through secondments, job swaps and the careful construction of groups on training courses and so on.

5. Databases and intranets, where information is held ready for when individuals or groups decide to call it up.

KNOWLEDGE MANAGEMENT

"Organisational knowledge is much talked about but little understood (Tsoukas and Vladimirou, 2001)."

This concept provides a review and interpretation of previous work on knowledge management and offers a comprehensive account of benefits achieved by properly managing knowledge, implementation information and success factors.

Knowledge Management Definition

Knowledge management (KM) encompasses any systematic attempt to acquire, produce, codify or share knowledge in order to positively enhance organisational learning, performance and competitiveness (Foray and Gault, 2003; Tsoukas and Vladimirou, 2001).

KNOWLEDGE CAPITAL

"In the modern world, knowledge capital, more than physical capital, drives the UK economy. Against the backdrop of the increasing importance of ideas, IP rights which protect their value are more vital than ever (Andrew Gowers' report on the UK intellectual property, December 2006)."

The concept reviews the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to knowledge transfer and intellectual capital. It also presents a compilation of possible and potential benefits and offers selective resources for further exploration.

Knowledge Capital Definition

Knowledge capital (sometimes referred to as intellectual capital) is an intangible asset of organisations. It can exist in two forms: (1) within the minds of those who know something useful that can increase organisational productivity thus taking a form of collective knowledge; (2) as a content, where content is a formal expression of knowledge capital turned into content knowledge capital is more useful for organisations (McGovern and Norton, 2001). The term is also used to bridge the gap between intellectual capital and knowledge management disciplines (Chatzkel, 2003).

Knowledge Management

‘Every day, knowledge essential to your business walks out of your door, and much of it never comes back. Employees leave, customers come and go and their knowledge leaves with them. This information drain costs you time, money and customers’.

 Knowledge

◦ Applying managerial experience to problem solving

Knowledge management

◦ Techniques and tools for collecting, managing and disseminating knowledge within an organisation

Knowledge Management

• Information into knowledge

• Often, information by itself is not enough on which to act. It needs to be combined with a manager’s experience and insight (sometimes referred to as ‘tacit knowledge’) to give the knowledge that enables effective action. This concept of ‘knowledge management’ (i.e. how the combination of information and tacit knowledge that people have in their heads can best be captured and used) is relatively new within organisations.

Two main knowledge types

1. Explicit – details of processes and procedures. Explicit knowledge can be readily detailed in procedural manuals and databases.

Examples?

2. Tacit – less tangible than explicit knowledge, this is experience on how to react to a situation when many different variables are involved.

Examples?

1. Transactional. Help desk and customer service applications.

2. Analytical. Data warehousing and data mining for CRM applications.

Classes of KM applications

3. Asset management. Document and content management.

4. Process support. TQM, benchmarking, BPR, Six Sigma.

5. Developmental. Enhancing staff skills, competencies –training and e-learning.

6. Innovation and creation. Communities, collaboration and virtual teamwork.

Management Information Systems

The functions of management and levels of management decision-making

Structured and unstructured decisions

The process of decision-making

Decision models

Decision support systems

The functions of management

• To forecast and plan

• To organise

• To command

• To co-ordinate

• To control

Henri Fayol (1841-1925)

Levels of information-based decision making

Strategic level, managers are largely concerned with longterm organisational planning.

Tactical level, medium term.

Operational, shortterm, day-to-day.

Levels of management

• Strategic management

• Board of directors and senior executives

• medium to long term focus

• strong requirement for information from external sources

• need highly summarised reports as well as varying amounts of detail.

Levels of management

• Tactical management

• middle, departmental, functional managers

• shorter to medium term focus

• need information from both inside and outside the organisation

• summarised and more detailed reports needed

Levels of management

• Operational management

• maintaining the status quo.

• foremen, supervisors, charge hands

• need information from within the organisation, rarely from outside

• need detailed information and unsophisticated summaries.

Levels of management

• Compared with strategic level, at the operational level...

• the planning horizon is narrower

• decisions are more structured

• information is required to be based more on internal sources, more historical, less summarised and more highly accurate

MIS and Decision Making

• Fully structured decisions

• the MIS might make the decision itself

• or at least suggest an outcome and await edits

• for example, stock re-order

• Semi-structured decisions

• the MIS will provide support, charts, output summaries, and the manager will make the decision

Decision characteristics

Patterns of Conflict – The OODA Loop

• Conflict can be seen as a series of decision-making cycles.

• In the simplest format, we observe a threat, orientate ourselves to deal with it based on a mental model that is constructed from our experience, make a decision and do something. This then starts again as our action changes the situation.

• The faster that you can cycle through this loop, the more control you will exert on a given situation. The reason for this is that the faster you make decisions, the more control you have over the environment.

• By the time you opponent is starting to act, you have changed the environment by doing something to it.

• This causes your opponent to panic as they loose control of the situation – and it is compounded the faster you cycle through the OODA Loop. A panicked opponent is one that will freeze and can therefore be defeated with little cost to you.

• That’s the simplest explanation of the OODA Loop.

Patterns of Conflict – The OODA Loop

Data mining

• Data mining is looking for hidden, valid, and potentially useful patterns in huge data sets. Data Mining is all about discovering unsuspected/ previously unknown relationships amongst the data.

• It is a multi-disciplinary skill that uses machine learning, statistics, AI and database technology.

• The insights derived via Data Mining can be used for marketing, fraud detection, and scientific discovery, etc.

• Data mining is also called as Knowledge discovery, Knowledge extraction, data/pattern analysis, information harvesting, etc.

Data Mining

• Knowledge Discovery in Data

• Definition: In simple words, data mining is defined as a process used to extract usable data from a larger set of any raw data. It implies analysing data patterns in large batches of data using one or more software. Data mining is also known as Knowledge Discovery in Data (KDD). ...

• Data mining, or knowledge discovery from data (KDD), is the process of uncovering trends, common themes or patterns in “big data”. ... For example, an early form of data mining was used by companies to analyze huge amounts of scanner data from supermarkets

SQL is Structured Query Language

SQL is Structured Query Language, which is a computer language for storing, manipulating and retrieving data stored in a relational database. SQL is the standard language for Relational Database System.

Structured Query Language or SQL, is a programming nomenclature used to do set operations (like union, intersect, and minus) to organize and retrieve information in relational databases, based on “set theory and relational algebra.” In any system that uses SQL, “data elements or attributes, categorized into columns,

SQL is Structured Query Language

Socialisation, Externalisation, Combination, Internalisation (SECI)

Model

(Nonaka and Takeuchi, 1996)

Socialisation, Externalisation, Combination, Internalisation (SECI) Model (Nonaka and Takeuchi, 1996)

• SECI Model was introduced by Nonaka and Takeuchi and has become the vital element of knowledge creation and transfer (Nonaka & Takeuchi, 1996). ... The acronym of the SECI stand for Socialisation, Externalisation, Combination and Internalisation and are phases that occur when tacit and explicit knowledge interact.

Four modes of knowledge conversion were identified

• Tacit to Tacit (Socialization) – This dimension explains Social interaction as tacit to tacit knowledge transfer, sharing tacit knowledge face-to-face or through experiences. For example, meetings and brainstorm can support this kind of interaction. Since tacit knowledge is difficult to formalize and often time and space specific, tacit knowledge can be acquired only through shared experience, such as spending time together or living in the same environment. Socialization typically occurs in a traditional apprenticeship, where apprentices learn the tacit knowledge needed in their craft through hands-on experience, rather than from written manuals or textbooks

• Tacit to Explicit (Externalization) – Between tacit and explicit knowledge by Externalization (publishing, articulating knowledge), developing factors, which embed the combined tacit knowledge which enable its communication. For example, concepts, images, and written documents can support this kind of interaction. When tacit knowledge is made explicit, knowledge is crystallized, thus allowing it to be shared by others, and it becomes the basis of new knowledge. Concept creation in new product development is an example of this conversion process

Socialisation, Externalisation, Combination, Internalisation (SECI) Model (Nonaka and Takeuchi, 1996)

• Explicit to Explicit (Combination) – Explicit to explicit by Combination (organizing, integrating knowledge), combining different types of explicit knowledge, for example building prototypes. The creative use of computerized communication networks and large-scale databases can support this mode of knowledge conversion. Explicit knowledge is collected from inside or outside the organisation and then combined, edited or processed to form new knowledge. The new explicit knowledge is then disseminated among the members of the organization

• Explicit to Tacit (Internalization) – Explicit to tacit by Internalization (knowledge receiving and application by an individual), enclosed by learning by doing; on the other hand, explicit knowledge becomes part of an individual's knowledge and will be assets for an organization. Internalization is also a process of continuous individual and collective reflection and the ability to see connections and recognize patterns and the capacity to make sense between fields, ideas, and concepts.

• After internalization the process continues at a new 'level', hence the metaphor of a "spiral" of knowledge creation (Nonaka & Takeuchi 1995: 71-2, 89) often referred to as the SECI model.

• Nonaka and Konno subsequently developed the SECI model by introducing the Japanese concept of 'Ba', which roughly translates as 'place'. Ba can be thought of as a shared context or shared space in which knowledge is shared, created and utilized. It is a concept that unifies physical space such as an office space, virtual space such as e-mail, and mental space such as shared ideas.

Collison and Parcell, 2004 Knowledge and Know

How• In this age of information overflow, ‘knowledge management (KM)’ is a commonly used term for knowledge sharing, organisational learning and effectiveness in the development sector.

• Indeed the term KM is itself contested: “you can't manage knowledge - nobody can. What you can do is to manage the environment in which knowledge can be created, discovered, captured, shared, distilled, validated, transferred, adopted, adapted and applied” (Collison and Parcell, 2004).

There is however consensus on practices and activities that should be included in a definition of KM, including:

• Information management: the collection and management of material from one or more sources and making that material accessible to and usable by one or more audiences;

• Knowledge sharing: a set of practices that enables people to share what they know with others in the application of their work;

• Learning processes: both individual and collective or social, focusing less on the “sending” and more on the “receiving”, particularly the processes of sense making, understanding, and being able to act upon the information available;

• Communication: in the sense of a meaningful exchange, as a foundational competence for the interactions that are at the centre of learning, sharing and managing knowledge.

Collison and Parcell, 2004 Knowledge and Know How

• This KM Self-Assessment or Five Competencies framework describes the five key organisational ‘competencies’, seen as being of high practical relevance for knowledge management and organisational learning initiatives.

• The Five Competencies Framework can be used by many different teams or groups, to work out how well they are performing against organisationally established criteria for knowledge and learning, and to identify goals and priorities for improvement.

• The competency framework works on the principle that effective knowledge and learning is based on improving performance against five important competency areas:

Vroom Yetton Jago Decision Model 1973

• The Vroom Yetton Jago Decision Model is a model for decision-making that’s based on situational leadership.

• The model can be used by everyone, irrespective of rank or position and helps to choose the right management style in various decision situations. In some business situations, it’s better that the leader takes all the decisions, whereas in other situations it’s better if the group has a say.

• The Vroom Yetton Jago Decision Model helps to choose the right style by having the user answer a series of questions with either yes or no.

• This series of questions is presented in the form of a decision matrix.

• After answering the questions, the user immediately sees what method best suits the situation concerned. According to the model, three specific factors have direct influence on the method for decision-making: quality, collaboration and time.

• The series of questions creates clarity regarding the influence of these factors in the decision situation. Subsequently, the model displays how the leader should make the decision: independently, together with the group or after obtaining advice. There are five different situations in total in which a different approach is desired and effective.

• The Vroom Yetton Jago Decision Model was originally developed by Victor Vroom and Phillip Yetton in 1973, and it was expanded 15 years later by supplementations from Arthur Jago.

Vroom Yetton Jago Decision Model 1973

• Three Important Factors in Decision-making

• When a decision must be made, the desired management style and the degree of participation of team members are influenced by three important factors. The Vroom Yetton Jago Decision Model therefore demands proper thought before answering the series of questions. By considering the three specific factors, better insight is formed about the decision to be made. The following three factors are important in each decision situation:

• The Quality of the Decision

• The quality of the decision to be taken is about how much impact the decision will have and how important it is to find the right solution. The higher the decision’s quality, the more people must be involved in the decision process.

• Involvement and Collaboration

• Involvement and collaboration concerns the question of how important it is that everyone agrees to the decision in a team. Depending on how important this is, the degree of participation must be raised or lowered.

• Time Constraints

• How much time is there to take decision? If there’s little time, a fast autocratic approach might be more desirable, as there’s no time to lose in certain situations. If there’s a lot of time, there are more options to involve more team players in the decision process.

• The way in which these factors influence the situation helps the user to determine what the best leadership style and decision method are.

Vroom Yetton Jago Decision Model 1973

The way in which these factors influence the situation helps the user to determine what the best leadership style and decision method are.

Five Decision-making Styles

The Vroom Yetton Jago Decision Model distinguishes between three leadership styles and five different decision processes:

Autocratic I (A1)

• In this decision process, the leader uses the available information to make a decision independently. The opinion of team members or external parties is not consulted in this case. Although the decision itself is not dependent upon the team members, and their opinion doesn’t matter, it is important that the made decision is communicated openly and clearly towards the team.

Autocratic II (A2)

• Here too, the leader independently makes the decision, but the difference with autocratic style 1 is that the leader has a bit more time and gathers information from team members or external parties. The team members don’t know why information is requested from them and don’t think about the situation, alternative or eventual choice.

Consultative I (C1)

• The leader adopts a consulting role and actively takes the lead to have team members individually give their opinion about the situation, the problem and the decision to be made. Here, the team’s involvement is higher than in the autocratic decision-making style. However, the decision is still made by the leader; he can choose to disregard the team’s opinion and input when these haven’t changed his outlook on the situation.

Consultative II (C2)

• Where the leader requests the individual opinions from the team members in the first consulting style, he brings the team together in a group meeting for a discussion in the second. Ideas and suggestions are asked for in this meeting. Here, the leader shares the problem and the situation with the group, but eventually, the leader is still the one to individually make the decision.

Group II (G2)

• The group as a whole makes the decision. The leader presents the situation and the problem to the group, identifies alternatives and makes a consensus decision. The leader purely plays the role of facilitator and accepts the decision of the group without considering his own opinion or vision.

• In order to determine which of these styles and processes is most suitable, taking into account the three factors, the decision tree from the Vroom-Yetton-Jago Decision Model must be completed.

Vroom

Yetton Jago Decision Model 1973

Vroom Yetton Jago Decision Model 1973

Charles Kepner and Benjamin Tregoe Rational Decision Making Model

• Decision-making is one of the most crucial challenges for managers. A global survey of CEOs cited by John Adair found that the ‘ability to take decisions’ was rated as the most important of 25 attributes required by senior managers.

• The way in which decisions are made will be influenced by an organisation’s structure, procedures and policies, and more subtly by its culture and politics. It should also depend on the nature of the decision, for example the levels of uncertainty involved, whether a creative or technical approach is needed, and how many people are involved.

• One well-known method for making decisions on specific issues was developed by Charles Kepner and Benjamin Tregoe in their book "The Rational Manager" published in 1965.

• Their research was based on their observations at RAND Corporation of how air force managers made decisions. They realised that while few were able to articulate their decision-making process, those who made better decisions could be seen to follow more logical processes.

• Kepner and Tregoe’s rational model can be an effective technique for determining a course of action and securing commitment to it. It is most suitable where a straightforward and technical approach is needed, rather than where creative thought is desirable.

• The model assumes that you can access all of the information you will need to make the decision. It requires that:

• a single goal and clear options can be defined

• preferences are unambiguous and constant

• there is a high level of certainty about outcomes.

Charles Kepner and Benjamin Tregoe Rational Decision Making Model

If used in the right circumstances, this model has several advantages over processes based on intuition. The rational model:

• takes a thorough and systematic approach

• aims to be impartial and transparent

• provides evidence and support for how the decision was made

• relies on effective information-gathering, rather than preconceived ideas

• prevents managers from being distracted by their emotional responses

There can, however, be drawbacks, because the method:

• can be very time-consuming and resource-intensive, especially in fast-moving situations

• relies heavily on information which may prove difficult to gather

• requires fairly strict adherence if the outcome is to be a rational decision

• leaves little room for intuition or lessons learned from past experience

Charles Kepner and Benjamin Tregoe Rational Decision Making Model

Ladder of Inference (Argyris & Senge, 2006), The Ladder of Inference was first put forward by organizational psychologist Chris Argyris and used by Peter Senge in The Fifth Discipline: The Art and Practice of the Learning Organization. The Ladder of Inference describes the thinking process that we go through, usually without realizing it, to get from a fact to a decision or action. The thinking stages can be seen as rungs on a ladder

The Six Thinking Hats

Edward de Bono in 1986

• The Six Thinking Hats is a role-playing model presented by. It serves as a teambased problem solving and brainstorming technique that can be used to explore problems and solutions and uncover ideas and options that might otherwise be overlooked by a homogeneously thinking group.

• De Bono's Six Thinking Hats is a powerful technique for looking at decision making from different points of view. It allows emotion and skepticism to be brought into what might normally be a purely rational process, and it opens up the opportunity for creativity within decision making.

The Six Thinking Hats

Edward de Bono in 1986

Root Cause Analysis (RCA)

• Root Cause Analysis (RCA) is a structured problem solving method. The aim of RCA is to identify, understand and solve the deeper 'root causes' of problems. RCA is built on the principle that causal relationships exist for all events. ... It is also universal in that it can be applied to any problem, in any sector.

• In science and engineering, root cause analysis (RCA) is a method of problem solving used for identifying the root causes of faults or problems.

Root Cause Analysis (RCA) Fishbone Diagram (Ishikawa, c.1968)

DEMING WHEEL

"“The Deming circle is a quality control program. It is a plan for management. Four steps: Design it, make it, sell it, [and] then test it in service. Repeat the four steps, over and over …” (W. Edwards Deming quoted by The United States General Accounting Office, 1981)."

This concept describes a Plan-Do-Check-Act wheel management model suggested by Deming. The model is used by companies to provide a systematic approach to achieving continuous improvement.

Deming Wheel Definition

The Deming Wheel is an iterative model developed by W. Edwards Deming composed of four functional elements: plan, do, study, and act. It is a looping model based on the principles of continuous process improvement (Fong et al., 1998).

The Deming Cycle

The Deming or PDCA Cycle (also known as PDSA Cycle), is a continuous quality improvement model consisting out of a logical sequence of four repetitive steps for continuous improvement and learning: Plan, Do, Study (Check) and Act. The PDSA cycle (or PDCA) is also known as the Deming Cycle, the Deming wheel of continuous improvement spiral.

DECISION TREES

"Decision trees can assist executives in making strategic decisions (Buckley and Dudley, 1999). "

The concept describes one of the most used decision-making models, a decision tree, which explores all possible decisions and their consequences and allows for comparison of such alternatives in one single pane.

Decision Trees Definition

A decision tree is an analytical tool for partitioning a dataset based on the relationships between a group of independent variables and a dependent variable (Coles and Rowley, 1995). It is a pictorial representation of the flow of events in a logical and time-sequenced manner so that the decision-maker can consider the probabilities of each outcome (Marsh, 1993). In other words, it is a decision support tool that uses a tree-like graph or model of decisions and their possible consequences, such as chance event outcomes, resource costs, and utility.

BOUNDED RATIONALITY MODEL OF DECISION-MAKING

"... decision making is the most important part of administration and the outcome of decisions depend on the process that is used in making decisions [...] bounded rationality is simply a process model that corresponds with the real world practical decision-making process (Kalantari, 2010)."

The concept provides a review of the practical decision-making process and explores the model’s strengths, limitations and implications by comparing it to the rational behaviour model.

Bounded Rationality Model of Decision-Making Definition

There are two primary models or theories for decision-making: the Rational model and the Bounded rationality model. In the former, a decision-maker attempts to optimise the decision by selecting the best possible alternative. In the latter, rationality of individuals is limited by the information they have, cognitive limitations and time constraints (Kalantari, 2011).

DECISION SUPPORT SYSTEMS

"In pursuing the goal of improving decision making, many different types of computerised DSS have been built to help decision teams and individual decision makers (Arnott and Pervan, 2008)."

The concept explains the usefulness of decision support systems for organisational problem solving. It describes the types of decision support systems available, their advantages and limitations, as well as real case studies of firms using DSS across different industries and sectors.

Decision Support Systems Definition

Decision Support Systems (DSS) are interactive computer-based systems that enable people to use IT communications, data, documents, knowledge and models to solve problems and make decisions. DSS are intended to improve and speed-up the processes by which people make and communicate decisions. However, they are designed to be auxiliary systems instead of replacing skilled decision makers (Power, 2002).

‘Shortcut’ strategies, for use if time is limited or the decision is less complex, include:

• Paired comparisons. If you are considering multiple options, pairing them and comparing their performance on key requirements allows you to quickly eliminate options, allowing only the preferred options to progress to the next ‘round’. You could then use another decision making tool to make the final choice.

• PMI – plus/minus/interesting is a kind of ‘pros and cons’ list used to make binary yes/no decisions, where you also record any interesting implications of the choice that do not clearly fit into the ‘plus’ or ‘minus’ columns. Before you start, it is important to ensure that a binary decision is really what you are faced with, and that you are not excluding other valid options.

• The Pareto Principle states that 20% of inputs deliver 80% of results. It can be applied and holds true in a surprising variety of situations. If you are aware of where this principle applies in your business, you may be able to work out which change option could deliver the greatest benefits.

Watch out for biases and common psychological traps

Common psychological traps that can impair our decision making include:

• confirmation bias – uncritical acceptance of information that confirms existing beliefs

• false analogy – assuming that the situation is just like a previous one, ignoring the differences

• availability bias – allowing your mind to construct a narrative only from the information that is immediately in front of you

• tunnel vision – failing to see the ‘big picture’ while focusing on the detail

• vividness – ignoring more mundane alternatives in favour of the most vivid option, for example being swayed by a sales pitch into making an instant decision without considering alternatives

• sunk cost fallacy – giving weight to resources that have already been spent, when these do not have an impact on the future costs and gains of pursuing an alternative

• loss aversion – a preference for avoiding possible losses over pursuing possible gains.

COGNITIVE BIAS

"It [cognitive bias] still doesn't get the attention from the mainstream media it deserves, and it isn't even touched on in most business school programs. I think it is worthy of a class by itself (May, 2006)."

Cognitive bias is a distortion in the way we perceive reality. This concept provides a comprehensive review of the cognitive bias that can affect individuals and organisations. You will also gain an understanding of the different kinds of biases and how to use techniques to level the playing field.

Cognitive Bias Definition

Cognitive bias refers to a mental error caused by simplified information processing strategies employed by our subconscious mind. Generally, human cognitive limitations allow people to use simplifying strategies to mentally process information. These strategies are generally useful as they help individuals deal with complexity and ambiguity. At the same time, they can lead to predictable faulty judgements known as cognitive biases (Tversky and Kahneman, 1974). Cognitive biases are studied by behavioural economists.

Action ChecklistWatch out for biases and common psychological traps

Chip and Dan Heath, in their book Decisive, propose a simple framework – the WRAP framework – for avoiding psychological traps:

• Widen your options – expand your set of choices as far as possible

• Reality-test your assumptions – collect reliable information and explore dissenting views

• Attain distance before deciding – avoid making decisions based on short-term or emotional factors

• Prepare to be wrong – what will happen if things do not go according to plan?

Action Checklist -Communicate the decision and act on it

• However you reach your decision, communicating it clearly is crucial. Your communications should:

• be timely

• include all stakeholders

• explain how and why the decision was made

• clearly explain the consequences of the decision.

• Force field analysis can help to identify and pre-empt any potential problems by identifying the forces that are expected to support or oppose change. This allows for strategies to be put in place to maximise the positive drivers and limit the negative forces.

Action Checklist

Monitor and learn from the outcomes

One of the most important factors in improving your decision making is feedback.

In some cases, feedback may be quick and clear. In others, such as long term investment decisions, it may take some time for the impact to become apparent.

It may also be ambiguous - the decision moved the organisation forward in some ways, but held it back in other areas.

However long it takes for the lessons to become clear, they should not be ignored.

Keeping a record such as a decision making journal could help you to continuously hone your decision making skills and recognise traps in your own thinking.

Hammer and Champy’s Business Process Redesign Model

Reengineering initiatives lead to an organisation having these characteristics:

Business processes are simplified

Job descriptions expand – employees perform a broader range oftasks

The emphasis moves away from the individual and towards teamachievements

The organisation structure changes from a hierarchy to a flatter arrangement

The focus of the organisation becomes professionals, not themanagers

The organisation becomes aligned with end-to-end process rather than departments

Performance measurement moves away from activity towards results

Employee focus changes from pleasing their manager to pleasing the customer

The organisation value system changes from being protective to being productive

7. Evaluate the new process

8. Ongoing continuous development

1. Develop vision & objectives

2. Understand existing processes

Successful reengineering programs have these common themes:

The focus is on processes rather than organisational boundaries

The ambition to create performance gains

A willingness to break with old traditions and rules

6. Make new

To succeed at reengineering, follow these principles:

Start with the customer and work backwards

Tolerate risk and accept flaws along the way

Design work processes in light of organisational goals

Restructure to support front-line performance

Remember that reengineering is the opposite of business as usual process operational

5.Implement the new process

Identify process

4. Identify change levers for re-design

Business Process Reengineering 3.

Hrebiniak’s Model of Strategy Execution

Dr. Lawrence G. Hrebiniak is an Emeritus Professor in the Department of Management at the Wharton School of the University of Pennsylvania and a member of the Strategy Group. He has written widely on the subject of strategy and in particular on the implementation of strategy. Based on his own research, this model provides an overview of the interdependent organisational components which need to interact with each other in order to successfully implement corporate strategy.

These are:

Corporate Strategy:

Which is concerned with the whole organisation and the business units within it.

Business Strategy:

Which focuses on products, services and short-term operating objectives.

Corporate Structure:

Across the whole organisation.

Business Structure:

In the individual business units.

Incentives and Controls:

To ensure that individuals put organisational strategy into practice.

Corporate Strategy

Corporate Structure/ Integration

Business strategy and short-term objectives

Incentives and Controls

Business Structure/ Integration

"The Freedom of Information Act 2000 encompasses information held not only by public organisations, but also by their contractors and suppliers in the private sector (CIPS Knowledge Works, 2009)."

FREEDOM OF INFORMATION ACT 2000

The Freedom of Information Act 2000 encourages organisations to work in a responsible manner. By adopting a policy of openness, organisations can engender greater public trust and confidence. Implementation steps are presented and strengths and drawbacks of the legislation are discussed.

Freedom of Information Act 2000 Definition

The Freedom of Information Act 2000 (FOIA) is a legislative framework set by the UK Government “to promote transparency and accountability in the public sector and to revolutionise the conduct and behaviour of public sector organisations” (CIPS Knowledge Works, 2009).

The Freedom of Information Act 2000

The Freedom of Information Act 2000 provides public access to information held by public authorities. It does this in two ways:

public authorities are obliged to publish certain information about their activities; and members of the public are entitled to request information from public authorities.

The Act covers any recorded information that is held by a public authority in England, Wales and Northern Ireland, and by UK-wide public authorities based in Scotland. Information held by Scottish public authorities is covered by Scotland’s own Freedom of Information (Scotland) Act 2002.

Public authorities include government departments, local authorities, the NHS, state schools and police forces. However, the Act does not necessarily cover every organisation that receives public money. For example, it does not cover some charities that receive grants and certain private sector organisations that perform public functions.

Recorded information includes printed documents, computer files, letters, emails, photographs, and sound or video recordings.

The Act does not give people access to their own personal data (information about themselves) such as their health records or credit reference file. If a member of the public wants to see information that a public authority holds about them, they should make a data protection subject access request.

Responsibility for Data

All organisations (irrespective of their size) that regularly and systematically collect, monitor or review data need to employ a dedicated Data Protection Officer (DPO) (ICO, 2020).

The DPO is an advisory role, that liaises directly with board level representative and is responsible for providing advice and direction on how to legally collect, monitor and process data and information.

They also need to be independent from the organisations operations, this is to ensure that they have the authority to enact, whilst do not have any conflicts of interest (ICO, 2020).

All organisations that process personal data or information including, but not limited to employees, customers, clients and third party vendors need to appoint a ‘data controller’ role (ICO, 2020).

The data controller is responsible for determining what personal information/data is collected, how it is collected and why it is collected as well as how the information is stored, processed and accessed (ICO, 2020).

They are normally expected to be the single point of contact within the organisation for any GDPR related queries (CMI, 2020).

Data Protection Act

Researchers must adhere to data protection requirements when managing or sharing personal data. However, not all research data obtained from people count as personal data. If data are anonymised then the Act will not apply as they no longer constitute 'personal data'.

The Data Protection Act 1998 (DPA) provides some exceptions for research data and applies only to personal or sensitive personal data, and not to all research data in general, nor to anonymised data. The new EU General Data Protection Regulation will come into effect in 2018 and will also play a key role in managing and sharing research data.

The DPA defines 8 principles that deal with the processing of personal data relating to identifiable living people. All such data must be:

• Processed fairly and lawfully

• Obtained and processed for a specified purpose

• Adequate, relevant and not excessive for the purpose

• Accurate

• Not kept longer than necessary

• Processed in accordance with the rights of data subjects, for example, the right to be informed about how data will be used, stored, processed, transferred, destroyed; and the right to access information and data held

• Kept secure

• Not transferred abroad without adequate protection

GDPR

The new Data Protection Bill (which will become the Data Protection Act 2018) applies before and after the UK’s departure fro m the EU. It incorporates both the GDPR’s provisions, and replicates and updates the Data Protection Act 1998 (DPA). Many of the GDPR’s co re principles are similar to the current DPA, but there are some differences.

Several key areas will have an impact on employers.

Data protection officers

• Public authorities, and organisations where data processing is a core activity of the business or done on a large scale, will need to appoint a data protection officer with expert knowledge of data protection. This can be an employee or an outside consultant.

• Several organisations can share the same DPO, provided there is no conflict of interests.

Changes to consent

• Organisations have previously been able to rely on implied consent to data processing. The GDPR requires a higher standard of consent. Individuals must clearly and positively establish specific agreement to their personal data being processed, such as by a written statement. Employers relying on consent to process personal data should review their procedures to ensure that any consent obtained clearly indicates agreement (the example used in the GDPR is that ticking a blank box is sufficient, but failing to un-tick a pre-ticked box is not valid consent).

Individuals can withdraw their consent at any time.

GDPR

The right to be forgotten

• Individuals can ask organisations to delete their personal data if that data is no longer needed for the reason it was collected, or if they decide to withdraw their consent.

Data portability

• Individuals are entitled to a copy of their personal data in a commonly used, machine-readable format and have the right to transfer that data to another organisation.

Notification

• Organisations must notify the ICO (Information Commissioner's Office) of all data breaches without undue delay and, where possible, within 72 hours.

Subject access requests (SARs)

• Employees often use SARs under the current Data Protection Act to request information in support of an employment tribunal claim. The key changes to SARs under the GDPR include removing the ability to charge fees, unless the request is excessive. The time limits for responding to requests have also been shortened from 40 days to one month. (For further information on these changes, see Q 'What is the procedure for a subject access request?')

Penalties

• The penalties for non-compliance with data protection rules are increasing. Under the current Data Protection Act 1998, the maximum penalty is £500,000 (see Q 'What penalties do employers face for breaching the DPA?'). Once the new Act is in force, the maximum penalty will be €20 million or 4% of global annual turnover. Administrative breaches of the Act will attract a lower fine.

Communications Act 2003

The Communications Act 2003 is an act that covers various different communications media. The main computing issues that the act protects against are:

‘Piggybacking’

• This is a term used to describe the process of using someone else’s internet connection without their permission or any intention to pay for access. Using a neighbour’s WiFi connection without their permission is an example of piggybacking. Using a free WiFi access point like those found in coffee shops is not piggybacking as the company have given customers permission to use their WiFi connection.

Threatening behaviour online

• The Communications Act also protects against receiving threats online. In today’s electronic age, social media can often be used by people to post threatening comments.

• Posting comments to deliberately cause distress is part of what is known as ‘trolling’. Some parts of the communications act protect against trolling but the law is due to be updated to better reflect the fact that online trolls can cause offence without necessarily being threatening to others.

Offensive and indecent images

• Sending offensive or indecent images of others is also an offence covered by the communications act. Mobile and tablet devices make it very easy to capture videos and images and sometimes the content of the images can be deemed as offensive or indecent. Deliberately sharing these images on social media can be an offence under the Communications Act.

The Digital Economy Act 2017

An awful lot has changed in the world’s digital landscape since the original Electronic Communications Code was introduced in 1984, which was designed to facilitate the installation and maintenance of fixed line communications networks.

The Code was extended in 2003 in recognition of the development and availability of new forms of digital technology, however, it has long been considered complex, out of date and unsatisfactory for landowners, operators and infrastructure providers alike. Indeed, it was famously described in a 2010 case by Mr Justice Lewison (as he then was) as “one of the least coherent and thought-through pieces of legislation in the statute book”.

Companies now rely on super-high-speed fibre optic broadband to keep up with their competitors, and consumers are becoming more and more dependent on technology, particularly with the use of smartphones which have become a part of daily life.

The Digital Economy Act 2017, therefore,introduces a new Electronic Communications Code, intended to aid the creation and operation of such networks, as well as to address some of the critical issues that currently affect the telecommunications industry. The new Code has not been welcomed by landowners, but the government has stated that it is simply putting communications on the same footing as other essential utilities such as water and energy.

"The prevailing approaches to CSR are so disconnected from business as to obscure many of the greatest opportunities for companies to benefit society (Porter and Kramer, 2006)."

CORPORATE SOCIAL RESPONSIBILITY

This concept explores the different ways in which CSR is defined and provides an account of success factors and business evidence.

Corporate Social Responsibility Definition

Corporate social responsibility (CSR) is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large (World Business Council for Sustainable Development, 1999).

HUMAN RESOURCES INFORMATION SYSTEMS

"HRIS can be used in organisational design as a tool for facilitating HR strategic alignment (Kleynhans, 2006)."

The concept describes human resource information systems (HRIS) as a computerised system that enables HR managers to gather, organise, store, update and retrieve the information needed for managing employees. It explains the various strengths and drawbacks of HRIS and provides the steps needed to implement it and the factors required for success.

Human Resources Information Systems Definition

A Human Resources Information System (HRIS) is a computerised system that enables human resource managers to gather, organise, store, update and retrieve the information needed for managing employees (Kleynhans, 2006). As with other technologies, the aim of HRIS is to increase the productivity of employees, in this case, to increase HR department efficiency. HRIS is a technology that has evolved over the last thirty years, moving from a simple data management system, to a management information system, to a real decision support system (Waddill & Marquardt, 2011).

CORPORATE/ORGANISATIONAL CULTURE

"There is no one 'right' or 'best' culture for an organisation - only the appropriate culture for the business environment (Gareth Jones and Rob Goffee)."

This concept explores how organisations build up their own culture through tradition, history and structure. It also suggests that culture provides organisations with a sense of identity.

Corporate/Organisational Culture Definition

Organisational culture is a pattern of basic assumptions invented, discovered or developed by a given group within an organisation as it learns to cope with its problems of external adaptation and internal integration. The pattern has worked well enough to be considered valid and therefore is to be taught to new members as the correct way to perceive, think and feel in relation to problems (Schein, 1988; 1996).

BUSINESS ETHICS

"When firms “act”, they are expected to meet a minimum set of standards and obligations as morally defined and evaluated by these individuals and groups (Werhane and Freeman, 1999)."

Businesses face ethical issues and decisions almost every day. The concept explores what is means for companies and what they can do to coordinate the interests of their stakeholders.

Business Ethics Definition

Business ethics is “the degree of moral obligation that may be ascribed to corporations beyond simple obedience to the laws of the state” (Kilcullen and Kooistra, 1999). It concerns “business situations, activities, and decisions where the issue of right and wrong are addressed…[meaning] morally right or wrong as opposed to, for example, commercially, strategically, or financially right or wrong” (Crane and Matten, 2007).

DOUBLE-LOOP LEARNING

"By uncovering their own hidden theories of action, managers can detect and correct errors (Argyris, 1977)."

Double-loop learning (DLL) is an educational concept that involves teaching people to think more deeply about their own assumptions and beliefs. You will gain an understanding of the different but related concepts and learn the difference between DDL and "learning from your mistakes”.

Double-Loop Learning Definition

Double-loop learning (DLL), also known as Generative learning, is a type of transformational learning. DLL involves creativity and innovation and is about adapting, being ahead of, and anticipating change (Malone, 2003).

KEY PERFORMANCE INDICATORS

"KPIs should: (1) tell a story; (2) represent a reduction or construction of reality; (3) act as a base to spin a story around; (4) vary between organisations (Catasus et al., 2008)."

Too often organisations combine other performance measures with that of KPIs, which can lead to difficulties in managing performance and tracking success. Practical implementation steps and case evidence provided helps leaders to focus on quality KPI’s that directly measure the areas needed in order to achieve success.

Key Performance Indicators Definition

Key performance indicators (KPIs) are agreed upon performance metrics designed to give managers and employees oversight of whether people are on track to meet targets and goals. In addition to end goals and results, KPIs provide a tool for defining what success looks like over an extended period of time. Multiple KPIs are often deployed simultaneously to provide a rounded picture of performance at individual and team levels (Ax et al., 2009; Kennerey & Neely, 2003).

STAKEHOLDER ANALYSIS AND MANAGEMENT

• "Essentially, a good understanding of stakeholder management enables a firm to compete effectively by building and prioritising key relationships (Co and Barro, 2009; Friedman and Miles, 2002)."

• The purpose of the concept is to explore the ideas and experiences in developing and applying stakeholder analysis. The concept sets out the benefits of stakeholder analysis and provides indicative guidelines and recommendations for its implementation.

Stakeholder Analysis and Management Definition

• Stakeholder analysis refers to the methodological process of identifying the different types of individuals and groups who have an interest in or impact on an organisation. Stakeholder management is the processes and strategies deployed by the organisation to manage stakeholder expectations and power levels, as well as conflicts of interest (Co and Barro, 2009; Lynch, 2006).

Stakeholder Definitions

• The term stakeholder first “appeared in the management literature in an internal memorandum at the Stanford Research Institute, in 1963” (Freeman, 1984, p. 31).

• The word means “any group or individual who can affect or is affected by the achievement of the organization's objectives” (Freeman, 1984, p. 46).

• Bryson (1995, p. 27) proposed a more comprehensive definition for the term: “A stakeholder is defined as any person, group, or organization that can place a claim on an organization's attention, resources, or output or is affected by that output”.

Power-Interest Grid Source: Eden and Ackermann (1998)

Power-Interest Grid Source: Eden and Ackermann (1998) cited in Bryson, John 2004. “What to do When Stakeholders Matter: Stakeholder Identification and Analysis Techniques.” Policy Management Review 6(1): 21-53.

The power-interest grid, as shown to the right, helps to visualise the positions of individual stakeholders and the relations among them. The two dimensions of the grid –power and interest – speak to the reality that not all of the players who have an interest in agricultural land use planning also have power to influence decisions. The two-dimensional grid generates four categories of stakeholders:

· Players: have both an interest and significant power

· Subjects: have an interest but little power

· Context setters: have power but little direct interest

· Crowd: have little interest or power

Power-Interest Grid Source: Eden and Ackermann (1998)

Eden and Ackermann, 1998

COST-VOLUME-PROFIT ANALYSIS

"Break-even analysis is a particular example of the more general technique of cost-volume-profit analysis. This analysis emphasizes the relationship between sales, revenue, costs and profit in the short term (Weetman, 2006). "

Cost-volume-profit (CVP) analysis is used to determine how changes in costs and volume affect a company's operating income and net income. This concept reviews strength and weaknesses of the analysis and outlines its main principles.

Cost-Volume-Profit Analysis Definition

Cost-Volume-Profit (CVP) Analysis, also known as Break-even Analysis, is a way of understanding the relationship between a business costs, the volume of good or sales they need to make and any potential profit. It is a tool for planning and decision-making that emphasises the interrelationships of cost, quantity sold, and price (Hansen et al., 2007). It allows managers to see the effect of changes in cost and volume on a company's profits so can be used help make decisions such as set selling prices, determine product-mix, and maximise the use of production facilities. (Weygandt et al., 2009).

FINANCIAL RATIO ANALYSIS

"Financial ratios allow the analyst to assess and analyse the strengths and weaknesses of a given company ... on an absolute basis and by comparison to other companies in its industry or to an industry standard (Hitchner, 2011)."

Financial Ratio Analysis is a useful tool for detecting the company's strengths and weaknesses - many stakeholders use it to make important decisions when it comes to investments. The concept reviews the most essential elements and applications of Financial Ratio Analysis, along with its strengths and weaknesses.

Financial Ratio Analysis Definition

As financial statements contain a huge amount of data, financial analysts condense this data into a manageable form by calculating a small number of key financial ratios (Brealey and Myers, 2003). These ratios are classified into different types focused on different analysis perspectives - this is due to the fact that every stakeholder will have different objectives and expectations, requiring different analysis points of view (Moyer et al., 2008). The different groups are liquidity, asset management (or efficiency), financial leverage, profitability, market-based and dividend policy ratios.

RETURN ON CAPITAL EMPLOYED

"Organisations need to be aware that bias from accounting procedures could potentially “mask” underlying operating efficiency (Lucey, 2003)."

Return on capital employed is an accounting ratio used in finance, valuation, and accounting. The concept explains the ratio in more details and explores how it is can be used in organisations.

Return on Capital Employed Definition

Return on Capital Employed (ROCE), also termed return on investment (ROI), is the summary ratio which captures in the numerator the earnings of a company's preinterest expenses and tax, and in the denominator the total capital employed calculated as interest bearing long-term debt plus shareholder funds (Andersson et al., 2006:24).

"In the final analysis, you get what you pay for (James Sinegal, CEO Costco)."

COSTBENEFIT ANALYSIS

The concept will enable business owners, project leaders and practitioners to grasp the basics of costbenefit analysis and understand the systematic process for calculating and comparing benefits and costs of a project.

Cost-Benefit Analysis Definition

Cost-Benefit analysis is an approach to activity appraisal that involves the estimation of the overall cost and benefits in monetary value terms. The activity could be an impending project or proposed policy. The approach is used to determine whether a particular activity is viable or to evaluate the effects of alternative decisions (Barnett, 1985).

Key Performance Indicators

• "KPIs should: (1) tell a story; (2) represent a reduction or construction of reality; (3) act as a base to spin a story around; (4) vary between organisations (Catasus et al., 2008)."

• Too often organisations combine other performance measures with that of KPIs, which can lead to difficulties in managing performance and tracking success. Practical implementation steps and case evidence provided helps leaders to focus on quality KPI’s that directly measure the areas needed in order to achieve success.

• Key Performance Indicators Definition

• Key performance indicators (KPIs) are agreed upon performance metrics designed to give managers and employees oversight of whether people are on track to meet targets and goals. In addition to end goals and results, KPIs provide a tool for defining what success looks like over an extended period of time. Multiple KPIs are often deployed simultaneously to provide a rounded picture of performance at individual and team levels (Ax et al., 2009; Kennerey & Neely, 2003).

CAPABILITY MANAGEMENT

• "Merely possessing valuable resources is insufficient to sustain competitive advantage – what firms really need are “dynamic capabilities”."

• Capability management is an effective technique for creating market change and to sustain longterm competitive advantage in fast-moving markets. Learn how to use dynamic capabilities as organisational and strategic routines to deploy and reconfigure your firm’s resources.

• Capability Management Definition

• Capability management is the capacity to structure, combine, and leverage internal and external resources for the purpose of creating new value for stakeholders and maximising competitive advantage. Capability management distinguishes between (1) operational capabilities: common processes and techniques that can be learned and imitated, e.g. the Toyota production system, and (2) dynamic capabilities: hard-to-imitate “signature processes”, routines, and behaviours that are unique to each firm (Stead & Stead, 2015; Teece, 2014).

STRATEGIC PLANNING

"Strategic planning concerns how an organisation makes sense of where it is going, and the path it will adopt to get there (Kaplan and Beinhocker, 2003)"

This concept reviews the process of strategic planning and shows how companies can implement strategies to enhance company and product competitiveness. It also offers a summary of the benefits of the process and examples of its application.

Strategic Planning Definition

Strategic planning is a disciplined effort to produce fundamental decisions and actions aimed at shaping the nature and direction of an organisation’s activities (Bryson, 1988; Rudd et al., 2008).

Strategy Map

• "Strategy maps provide the specificity needed to translate general statements about high-level direction and strategy into specific objectives that are understandable for employees and that they can act upon (Kaplan & Norton, 2004a)."

• The concept explains how organisations can use strategy maps as an essential tool in their strategy and planning activities. It describes how organisations have successfully used strategy maps to achieve strategic alignment and identifies the steps required to apply the concept in practice.

• Strategy Map Definition

• A strategy map is a visual representation of the components of an organisation’s strategy and the relationships between a company’s financial, customer, internal process and learning and growth perspectives (as described on the balanced scorecard) (Kaplan & Norton, 2004b).

STRATEGIC POSITIONING

"Strategy should reflect a distinctive value chain that configures all key business processes and operations (operations, HRM, marketing, service delivery, etc.) in a unique way that is difficult for competitors to imitate (Porter, 2001)."

This concept reviews the formal and rational processes that can help organisations achieve the strategic positioning of their products and brands. It also addresses the success factors and implementation recommendations.

Strategic Positioning Definition

Strategic positioning is concerned with the way in which a business as a whole distinguishes itself in a valuable way from its competitors and delivers value to specific customer segments (Wickham, 2001: 230).

STRATEGIC CONTINGENCY

• "Organisations can be described as a collection of departments or functions that align together to cope with uncertainty (Hickson et al., 1971)."

• Power and politics are understood as fundamental and important factors in managing strategic contingencies. Relevant practical case evidence and implication advice provided helps leaders to minimise the potential impact caused by a risk factor, threat or emergency.

• Strategic Contingency Definition

• A contingency is "a requirement of the activities of one subunit which is affected by the activities of another subunit. What makes such a contingency strategic is that the more contingencies are controlled by a subunit, the greater is its power within the organisation.

• For example, an engineering subunit has power because it quickly absorbs uncertainty by repairing breakdowns that interfere with the different workflows for each of several organisational outputs" (Hickson et al., 1971).

SWOT ANALYSIS

• "SWOT analysis helps managers to select an appropriate strategy that matches their firm’s resources and capabilities to the environment in which they operate (Johnson et al., 2009)."

• A scan of the internal and external environment is an important part of the strategic planning process. This concept describes SWOT analysis and discusses its strengths and weaknesses.

SWOT Analysis Definition

• SWOT is a technique for analysing the internal and external environments of an organisation through the identification and assessment of its strengths, weaknesses, opportunities, and threats (SWOT). SWOT analysis entails a distillation of the findings of an internal and external audit that draws attention, from a strategic perspective, to the critical organisational strengths and weaknesses and the opportunities and threats facing the organisation (Kotler and Armstrong, 2011).

Analyse the business environment

The PEST analysis tool which is used by many organisations to help them get an overview of the current and future business environment in which they are operating, traditionally focused on political, economic, social and technological factors.

A number of variants such as PESTLE and PEST-C have evolved to include additional factors such as legal, environmental and cultural. Questions to ask include:

Pay particular attention to identifying the driving forces in your sector. These are the major underlying causes of changing competitive conditions. The most common of these are:

•What are the major trends likely to affect our business?

•What new technologies are available?

•How are customer needs and attitudes changing and evolving?

Porter’s Five Forces is tool which can help to assess the factors affecting the competitive position of an organisation.

•changes in long term industry growth rates

•increasing globalisation

•product innovation

•the strength and number of existing and emerging competitors.

•entry or exit of major firms in the sector.

PESTEL ANALYSIS

• "PESTEL is an important tool used for market and environmental analysis and to support strategic decision making (Narayanan and Fahey, 2001)."

• As a company looks to leverage its capabilities and expand, it is imperative that it considers a PESTEL analysis to accompany the SWOT analysis. This concept explains the fundamentals of the techniques and explores its strengths and weaknesses.

PESTEL Analysis Definition

• The PESTEL framework is an analytical tool used to identify key drivers of change in the strategic environment. PESTEL analysis includes Political, Economic, Social, Technological, Legal, and Environmental factors, but other variants include PEST, PESTLIED (including International and Demographic factors), STEEPLE (including Ethical factors), and STEEPLED (including Education and Demographic factors) (Johnson et al., 2008).

Levels of organisational maturity (Carnegie Mellon Maturity Index ‘CMMI’, 1990).

Resource-Based Strategy

• "One of the most integrating and almost ubiquitous threads of current management thinking emphasises the importance of a resource-based view of the company (Powell and Bradford, 2000)."

• The concept provides a review of resource-based strategy and describes some of its strengths and capabilities. It also looks at different variations of resourcebased approaches that have developed in organisations over the last few decades.

• Resource-Based Strategy Definition

• Resource-based strategy emphasises strategy creation built around the further exploitation of existing core competencies and strategic capabilities (Thompson and Martin, 2005).

BUSINESS ETHICS

• "When firms “act”, they are expected to meet a minimum set of standards and obligations as morally defined and evaluated by these individuals and groups (Werhane and Freeman, 1999)."

• Businesses face ethical issues and decisions almost every day. The concept explores what is means for companies and what they can do to coordinate the interests of their stakeholders.

• Business Ethics Definition

• Business ethics is “the degree of moral obligation that may be ascribed to corporations beyond simple obedience to the laws of the state” (Kilcullen and Kooistra, 1999). It concerns “business situations, activities, and decisions where the issue of right and wrong are addressed…[meaning] morally right or wrong as opposed to, for example, commercially, strategically, or financially right or wrong” (Crane and Matten, 2007).

CORPORATE SOCIAL RESPONSIBILITY

• "The prevailing approaches to CSR are so disconnected from business as to obscure many of the greatest opportunities for companies to benefit society (Porter and Kramer, 2006)."

• This concept explores the different ways in which CSR is defined and provides an account of success factors and business evidence.

• Corporate Social Responsibility Definition

• Corporate social responsibility (CSR) is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large (World Business Council for Sustainable Development, 1999).

OPERATIONS MANAGEMENT

"Key areas and functions of operations management include value chain analysis, supply chain management, inventory management, scheduling, quality control and business process analysis (Schermerhorn, 2011)."

Effective operations management is the cornerstone of most successful businesses. The concept details the core objectives of operations management and provides case study evidence that reinforces why it pays to invest time and resources in managing operations to the highest standards.

Operations Management Definition

Operations management focuses on how organisations produce goods and services efficiently and effectively. It concerns the improvement of business operations and the transformation process through which goods and services are created (Schermerhorn, 2011).

OPERATIONS STRATEGY MATRIX

"The operations strategy matrix exists a tool to assist organisations in making better strategic operations decisions (Slack and Lewis, 2002)."

The operations strategy matrix is a tool used by strategy professionals to assess major factors that affect company operations. The concept will assist organisations in making better strategic operational decisions and reducing risks. It draws special attention to the success factors and implementation step recommendations.

Operations Strategy Matrix Definition

The operations strategy matrix is a tool to assist organisations in making strategic operational decisions about capacity, the supply network, process technology, development and organisation. These decisions are dependent on five performance objectives: quality, speed, dependability, flexibility, and cost (Slack, 2005).

BUSINESS CYCLE

• "Economies by their very nature are prone to cycles of boom and bust: markets swing from confidence to pessimism and consumers from greed to fear (Conway, 2009). "

• The concept defines and describes the business cycle and reviews different explanations, types and leading theories that explain business cycles.

• Business Cycle Definition

• Business Cycles are short-term economic fluctuations around a long-run growth trend that correspond to changes in economic conditions. These fluctuations are irregular and unpredictable (Mankiw, 2011).

• The difference between a business cycle and a trend is what is known as the output gap.

• Economic cycles, as they can also be termed, are a continuous set of expansions and recessions (real income and GDP decline while unemployment rises); Conway (2009) states that if an economy contracts for two consecutive quarters then it is technically in recession.

BUSINESS MODELLING

• "A business model helps managers to explore complex choices, using a set of assumptions to represent alternative future operative environments (Tennent and Friend, 2011) "

• This concept is intended as a 'hands-on' practical discussion of how business modelling is used to explore a range of business decisions and to identify the essential elements that drive business.

• Business Modelling Definition

• Business models are "primary tools for the financial analysis of nearly all major business decisions" (Tennent and Friend, 2011:7).

BUSINESS INNOVATION

• "Business innovation is the creation of new value and wealth for stakeholders to increase economic prospects (Lorente et al., 1999; Miller, 1995)."

• The concept explores innovation and how it can create and capture value for organisations. It will provide professionals with a basic understanding business innovation.

• Business Innovation Definition

• Business innovation is the creation of substantial new value for customers and the company by creatively changing one or more dimensions of the business system (Sawhney et al., 2006).

• In other words, business innovation is the creation and adoption of something new that generates business value. This includes new products, services, or processes, such as integrated supply chain solutions (Sawhney et al., 2006).

BUSINESS PROCESS IMPROVEMENT

• "Your organisation's success hinges in large part on how well it carries out its business processesactivities that turn inputs such as knowledge and raw materials into products and services that create value for customers (HBR, 2010)."

• Business process improvement (BPI) can enhance internal organisational efficiency and change the way organisations function. The concept provides an overview of BPI and describes the process and tasks used to support an organisational objective.

Business Process Improvement Definition

• Business Process Improvement (BPI) is a method of improving the way a discrete set of business activities is organised and managed (Hammer and Champy, 1994). Business processes refer to the "logical organisation of people, materials, energy, equipment, and procedures into work activities designed to produce a specified end result" (Davenport and Short, 1990). BPI can be achieved by changing the state of elements of a business process (Griesberger et al., 2011).

BUSINESS PROCESS RE-ENGINEERING

• "The literature on re-engineering employs the term processes. Sometimes it is a synonym for activities. Sometimes it refers to activities or sets of activities that cut across organisational units (Porter, 1991)"

• The concept describes how to leverage best practices in business process reengineering while avoiding common pitfalls. It also reviews the latest technological and market perspectives.

Business Process Re-engineering Definition

• Business process re-engineering (BPR) is the "fundamental rethinking and radical redesign of business processes aimed at achieving radical improvements in essential contemporary measures of performance, such as cost, quality, service and speed" (Hammer and Champy, 1993).

ORGANISATION THEORY

"Modern organisation theory views the organisation as an open system, and reflects the fact that organisations operate in multiple environments and interact with numerous stakeholders (Daft, 1997)."

Organisational theory puts substantial emphasis on people in organisations and how they are treated. An overview of the theory’s and strengths and drawbacks, measurement and focus areas helps leaders apply the principles in practice.

Organisation Theory Definition

Organisation theory is the study of organisational design, relationships and structures. It focuses on such dimensions as level of organisation formalisation, specialisation, and standardisation, hierarchy of authority, complexity, size, goals and strategy. These dimensions provide a way of measuring and analysing organisations (Daft, 1997).

• "Effective people management involves providing an environment where employees can perform at their optimum level (Gross, 2009)."

ORGANISATION DEVELOPMENT

• OD interventions aim to find out the root cause of problems so that robust, sustainable solutions can be implemented. Application advice, typical success factors and measures provide practical advice on how to succeed with OD projects.

• Organisation Development Definition

• Organisation Development (OD) is a process that is "planned, organisation-wide, and managed from the top". The goal of OD is to increase organisational effectiveness and health through planned interventions in the organisation's processes and structures (Beckhard, 1969). In essence, OD is a "planned system of change. Organisation development is seen as a process that applies behavioural science knowledge and practices to help organisations achieve greater effectiveness" (Cummings & Worley, 2005).

GLOBAL STRATEGY

"Against economic adversity, some of the world’s leading companies, across a variety of industries, are trying to prosper in global markets (Corstjens & Lal, 2012)."

The concept explains how the world's leading companies are built on global strategies. It describes the components of global strategy and provides examples of cases of companies that have developed successful global strategies and sustained competitive advantages in developed and emerging markets.

Global Strategy Definition

Global strategy covers three macro areas of strategy: global, multinational and international strategies. These areas typically refer to those strategies designed to enable an organisation to achieve its objectives of foreign market penetration and international expansion (Lynch, 2006).

PARADIGM AND PARADIGM SHIFTING

• "True paradigm shifts represent drastic, sometimes uncomfortable change. It is not surprising, therefore, that these events can be met with resistance as organisational leaders step outside their comfort zones (Pink, 2005)."

• Paradigms are generally defined as a framework that has unwritten rules and that directs actions. A paradigm shift occurs when one paradigm loses its influence and another takes over. The concept defines paradigm and paradigm shift and explains how it can relate to company strategies and industry cycles.

• Paradigm and Paradigm Shifting Definition

• Although the term 'paradigm' has been around for a long time, wide acceptance and usage of the concept is mainly fuelled by Kuhn’s (1962) seminal work ‘The Structure of Scientific Revolutions’. Kuhn defined scientific paradigms as "accepted examples of actual scientific practice that include laws, theory, application and instrumentation that provide models from which particular coherent traditions of scientific research springs’’. Baker (1992) defined a paradigm as "a set of rules and regulations that establishes or defines boundaries and tells you how to behave inside those boundaries".

INNOVATION MANAGEMENT

• "Innovation management is the successful introduction of something new: it is the embodiment and synthesis of knowledge in original, relevant, valued new products, processes, or services (Luecke and Katz, 2003)."

• The concept determines the critical factors of innovation management. It reviews the managerial practices of successful innovators and summarises the strengths and limitations of innovative approaches.

• Innovation Management Definition

• Innovation management is the active organisation, control and execution of processes, activities, and policies that lead to the "creation of substantial new value for customers and the firm by creatively changing one or more dimensions of the business system" (Sawhney et al., 2006).

DIVERSITY MANAGEMENT

• "Diversity management is much more than just a multicultural issue: it is about embracing many different types of people, who stand for different things and represent different cultures, generations, ideas, and thinking (Llopis, 2011).“

• Effective workplace diversity management policies have been demonstrated to aid creative thinking processes and innovation. Case study evidence from a variety of sectors and implementation advice is provided to help managers increase the success of diversity management initiatives.

DIVERSITY MANAGEMENT

Diversity Management Definition

Diversity management, a part of human resource management, involves the recognition, effective deployment and harmonisation of individual employee idiosyncrasies.

Successful diversity management helps managers to maximise employee's knowledge and expertise to better achieve organisational objectives (Allen et al., 2004).

Diversity can stem from a wide range of factors including gender, ethnicity, personality, cultural beliefs, social and marital status, disability, or sexual orientation (Shen et al., 2009).

BIG DATA ANALYTICS

• "New roles are quickly emerging for data scientists… whose job is it to “help decision makers shift from ad hoc analysis to an ongoing conversation with the data” (Davenport & Patil, 2012)."

• Big Data analytics is complex, in order to succeed organisations need to invest in the people behind the technology. Strengths and weaknesses are considered and practical case studies of implementation are shared to help organisations build up their Big Data capabilities.

Big Data Analytics Definition

• Big Data analytics refers to the use of powerful tools and techniques to leverage data insights, trends and patterns from huge – often unstructured and disparate – data sets and make them easily and quickly accessible to business leaders, managers and other key stakeholders. These insights are used to inform and develop business strategies and plans (Bertolucci, 2013a; Zakir et al., 2015).

INFORMATION DATABASE MARKETING

"Information technology and business are becoming inextricably interwoven. I don't think anybody can talk meaningfully about one without the talking about the other (Bill Gates, 1999)."

Information databases can be used for a range of purposes, including accounting, planning, banking, manufacturing, or marketing. The concept describes an information database from the marketing perspective, and provides a description, business uses, and other tools that can assist professionals and managers to better understand it.

Information Database Marketing Definition

Information database (IDB) is a collection of records or data that is stored in a computer or information system and is used to create and sustain information. In Marketing and sales IDB stored data on a range of marketing activities (O'Brien et al., 1995). An IDB relies on a database management systems (DBMS) software to organise, store and retrieve data. DBMS are categorised according to the database model that they support. The model, in turn, determines the type of information to be retrieved (Dutta and Mia, 2011).

Learning Outcomes

Understand the strategic management of data and information

Unit 709 Strategic Management of Data and Information

709 Strategic Management of Data and Information

Aims of the Unit

Learning Outcomes

Understand the strategic management of data and information

AC 1.1 Critically

Command Verb

AC 1.1 Critically discuss the strategic use and value of data and information

AC 1.1 Critically discuss the strategic use and value of data and information

AC 1.1 Critically discuss the strategic use and value of data and information

AC 1.1 Critically discuss the strategic use and value of data and information

AC 1.2 Critically appraise the challenges of managing data

and information in an organisational context

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

AC 1.2 Critically appraise the challenges of managing data and information in an organisational context

AC 1.3 Evaluate approaches to the effective strategic management of data and information

Verb

AC 1.3 Evaluate

approaches to the effective strategic management of data and information

AC 1.3 Evaluate approaches to the effective strategic management

of data and information

AC 1.3 Evaluate approaches to the effective strategic management of data and information

AC 1.3 Evaluate approaches to the effective strategic management of data and information

1.4 Recommend a strategy to improve the management of data and information in an organisational context

Recommended Reading

Supplementary Books

Supplementary Books

Journals

Supplementary Journals

Suggested reading/web resource materials

Useful External Weblinks

Identify the features of data and information

when information should be offered and access allowed

A good answer would make reference to Sensitive Personal Data in terms of:

Discuss when information should be offered and access allowed

And the conditions to be met before processing sensitive personal data:

Methods of evaluating management information within an organisation

Methods of developing information capture to inform and support strategic decision making

INFORMATION MANAGEMENT

Information Management Definition

Strategic information planning

An information systems strategy plan

High-level decision making

Making strategic decisions

Making strategic decisions

Expert systems

How to make decisions

BALANCED SCORECARD

Improving information quality

What is management information?

Attributes of information system

Information management

Information management

Environmental scanning

Four-mode framework for environmental scanning

UNDIRECTED VIEWING

EXTERNAL INFORMATION (INWARD FLOWING)

CORPORATE INFOMRATION (OUTWARD FLOWING)

Using information to support business processes

Management information and decisionmaking

The strategic information challenge

What are information systems?

Strand Elements

Managing information as a strategic resource

Strategic importance of business information management

Create new reality

What are management information systems?

MIS components

The nature of management information systems

The nature of management information systems

Evaluating management information systems

Information system effectiveness

The use of data and information in decision making

Tools and techniques for analysing and interpreting data and information to support decision making

Data

Data

DIKW model Ackoff 1989

DIKW model Ackoff 1989