ISDP1: System Concepts- INFORMATION CONCEPTS unit 2


The terms ‘data’ and ‘information’ are used interchangeably in everyday speech as meaning the same thing. However, the terms have distinct meanings. System analysis and design are about data and information management, and this unit sets out to introduce you to the basic concepts of information.


By the end of this unit, you should be able to:

  • Define the concept of information
  • Distinguish between data and information
  • Explain the qualities of good information
  • Explain the levels of information


  • Overview

Raw facts, figures, images or sounds collected from observations or recordings about events, objects or people, which can be stored on a manual or computer-based medium e.g. employee’s name and number, number of hours worked in a week, inventory part numbers, or sales orders. Data has little meaning/value in its own right, it only has meaning when it is processed and put into context as information. For example, if we are told that John scored 85 in a test, it does not tell us a lot. Is it 85 marks? If it is 85% it may appear a good result, but how did the other people taking the test perform? What is the pass mark in the test? If it is 85 marks, what was the number of marks available? To be of any value, it needs to be processed in some ways to produce information e.g. collected, sorted, organized, presented in acceptable formats. Data is the input raw materials from which information is produced.

  • Information

Information is a data that has been processed and presented in a useful format that will enable an individual to gain knowledge in order to be able to make a decision. The act of producing data does not itself produce information. Information is data that have been interpreted and understood by the recipient of the message.

Information has meaning within a specific context and is useful for making a decision, solving a problem, performing a task etc. It is important to note that different individuals may need the same data arranged in quite different ways to give them information. The information required varies with the type of decision, problem, or task, the type of person and his/her needs.

 Data vs Information


data collected


Examples of Data and Information


payroll system table

  • Quality of Information

Good information is that which is used and which creates value. Research shows that good information has numerous qualities as follows:

  • Relevance/Appropriateness: Information must be relevant to the problem being considered. Too often reports etc, contain irrelevant parts which make understanding more difficult and cause frustration to the user and lead to information overload.
  • Accuracy: Information should be sufficiently accurate for the purpose for which it is intended, Need for accuracy varies according to information usage e.g. marketing director only interested in sales figures to +/- N15,000?


  • Completeness: The information should be complete in respect of the key elements of the problem.
  • Timeliness: Good information is that which is communicated in time to be used.
  • Reliable: Users must have confidence in the source of the information for it to be used.
  • Communicated to the right person: Information suppliers need to analyze the key decision points in an organization in order to direct information exactly where it is required.
  • That which contains the right level of detail: Information should


contain the least amount of detail consistent with effective decision making. The level of detail should vary with the level in the organisation; the higher the level the greater the   degree of compression and summarisation.


  • Communicated by an appropriate channel of communication. To be useable by the manager, information must be transmitted by means of a communication process.


  • Communication involves the interchange of facts, thoughts, value judgements and opinions and the communication process may take many forms: face-to-face conversations, telephone calls, informal and formal meetings, reports, tabulations, VDU transmissions etc. Whatever the process, good communication results where the sender and receiver are in accord over the meaning of a particular message.


  • That which is understandable by the user. Understandability is


what transforms data into information. If the information is not understood it cannot be used and thus cannot add value.


From above, we can see that many, many things need to be right before information can be considered as good. Note particularly, how many of the factors relate to social and behavioral characteristics. It is not sufficient merely to consider the technical aspects of data capture and processing; these are only one aspect of information system.

Information is crucial to business operation and survival interacting with environment -customers, suppliers etc. and for interaction/communication within the business. It is crucial that the business has information systems to manage this information.

  • Information Levels

Information within an organization can be analyzed into three levels. These levels of information are referred to as:

Strategic Information: used by senior managers to plan the objectives of their organisation and to assess whether the objectives are being met in practice e.g. population statistics, investment statistics, national resource availabilities. Much of this information must come from environmental sources, although internally generated information will also be used. It relates to long-term planning in an organisation, typically 3-5 years

Tactical Information: used by middle management to ensure that the resources of the business are employed efficiently and effectively to achieve the strategic objectives of the organisation e.g. sales analyses and forecasts, production requirements, annual financial statements, predicted course/student numbers. A large proportion of this information will be generated from within the organisation. Tactical information is usually prepared regularly – perhaps weekly or monthly and it is for medium-term planning, typically 6-24 months.

Operational Information: used by frontline managers such as foremen or head clerks to ensure that specific tasks are planned and carried out properly within a factory or office. Operational information is prepared regularly – perhaps weekly or daily and it is used for short-term planning, days, weeks, possibly hourly e.g. stock levels, overdue purchase orders, production control, module enrolments.

The destination level of information is very important as the information must be material to the user, but without going into unnecessary and time consuming detail in order to achieve pointless accuracy. For example: Operational control may need information accurate to the nearest penny. Management control may be satisfied with costs to the nearest hundred or thousand pounds. Greater detail would serve no purpose. Strategic planning may be satisfied with figures to the nearest ten thousand, hundred thousand or even million pounds. In all cases, the information and reports must be relevant to the particular user.




Information is crucial to business operation and survival interacting with environment -customers, suppliers etc. and for interaction/communication within the business. It is crucial that the business has information systems to manage this information.



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