CHAPTER 3
MANAGEMENT OF INFORMATION SYSTEM RESOURCES
CONCEPTS OF INFORMATION RESOURCE MANAGEMENT (IRM)
The term “Information Resources” incorporates three broad categories of “information stuff” essential to the modern business enterprise: the large mass of stored data (DATA); the huge volume of application system program code (APPLICATION SOFTWARE); and the numerous networked hardware components, along with the operating programming that makes it all work (TECHNOLOGY). These three components, working together, allow the enterprise to produce and use the information required to effectively operate, compete, and
manage on a daily basis. The information resources of most large enterprises represent a significant cost factor, yet interestingly, most enterprises do not manage these critical and expensive resources like they do all other resources. All of the “Big Five” resources (human, financial, equipment, material, and facilities) have very effective management discipline, based on several universal resource management principles:
Responsibility and authority must be clearly designated to manage the limited resource on behalf of the enterprise.
The resource is not free; limitations must be recognized, and managed so there is enough when and where needed, but waste and unused excess are costly mistakes.
The resource must be controlled, and allocated so it is available when and where needed, and should serve the highest priorities first.
The resource must be constantly tracked: the enterprise must always know how much of the resource it has, where it is located, what condition it is in, how to access it when needed, etc.
The resource must be properly stored and maintained so that it is ready and usable when needed.
The resource must be forecast – the enterprise must think and plan ahead to ensure it will have adequate supply of the resource when needed.
So, the term “Information Resource Management” simply means changing the way typical IS/IT is implemented within the enterprise, so that it manages the information resources (DATA, APPLICATION SOFTWARE, and TECHNOLOGY) like any other enterprise resource – the principles of how to properly and effectively manage it are exactly the same.
The enterprise must establish effective management control of the data resource, or it will never fully achieve the payoff: faster, cheaper, better business operations, and significantly greater business flexibility, innovation, and change. Data Resource Management (DRM) is a critical part of the IRM environment.
Most enterprises today are critically dependent upon automated information for both daily operation and management control. Today, information is the most important and highest-leveraged resource the enterprise controls — the means by which all other resources are managed. Yet, few businesses have begun to exploit the enormous strategic potential of a well-integrated information environment. Most enterprises function at a small fraction of their potential productivity with a set of terribly disintegrated, inconsistent, and often redundant application systems, operating on an underlying redundant, inconsistent, and untimely data mess. The main obstacles to exploiting the information resource are internal to the enterprise, and can be easily overcome – it is truly a common sense proposition.
This informational (not skill-building) seminar targets senior management of the enterprise, and strikingly contrasts the way we currently manage enterprise resources (human, financial, material, equipment, and
facilities), and the vastly different way we currently (mis)manage information resources of the enterprise. The seminar also contrasts the IRM environment with the traditional “disintegrated application systems”
environment embraced by most enterprises today, and shows exactly how and why the IRM approach solves the
problems inherent in the “dis-integrated systems” approach. It shows how simple application of well recognized, time-proven, routinely practiced management discipline to this stuff called “information” will remedy the massive information messes so prominent today. An integrated information environment is a strategic necessity today, and is not the result of accident nor random motion. The react-mode IS/IT
Organization within the enterprise today must be empowered to carefully plan, model, build/acquire, and maintain this integrated information environment, not to just react to immediate need of the moment. The need for the enterprise to change rapidly and affordably and the accelerating rate of change in computer technology makes IRM not only a proactive, but a defensive necessity in today’s economy. Ironically, any business or government agency today would function significantly faster, cheaper, better, and more flexibly using less than
10% of the stored data that they currently attempt to manage, less than 10% of the existing program code
they’ve bought/built, and a fraction of the computer technology (hardware and operating software) they currently manage. Integration means shaking it all down, pressing it together. One of the dilemmas facing today’s manager is that on the one hand they seem to be suffering from information overload, yet on other hand, they often complain about shortage of information needed to make vital decisions. Symptoms of overload are a growth of incoming information, including electronic mail, an explosion in the
volume of information sources. Symptoms of scarcity are the lack of vital information for decision making, unexpected competitor moves and the inability to find the relevant ‘needle in the haystack’ There is also the crucial problem of exploiting an organization’s proprietary information as a strategic asset. Underlying these problems is that of having “the right information, in the right place, in the right format, at the right time”.
What is the Solution?
Partial solutions include Executive Information Systems (EIS), On-line and CD-ROM data-bases, alerting services. A more encompassing solution is to adopt the principles of Information Resources Management (IRM) (not to be confused with an information management or information systems). Whereas the value (often declining!) of tangible assets, such as property and office equipment, is regularly assessed and audited, similar processes are lacking for intangible assets, such as information and knowledge, whose asset value is increasing
in many organizations. Information Resources Management (IRM) is an emerging discipline that helps managers assess and exploit their information assets for business development. It draws on the techniques of information science (libraries) and information systems (IT related). It’s an important foundation for knowledge management, in that it deals systematically with explicit knowledge. Knowledge centers often play an important part in introducing IRM
into an organization.
The five key activities for effective IRM management:
Identification what information is there? How is it identified and coded?
Ownership- who is responsible for different information entities and co-ordination?
Cost and Value A basic model for making judgments on purchase and use
Development increasing its value or stimulating demand.
Exploitation Proactive maximization of value for money.
Information Systems Resources (ISR) enables the use of information systems in administrative functions
so that those functions may be conducted in the most effective way possible. Information Systems Resources includes Networks, Hardware, Software, Data & People What are the resources an information system needs?
Discover how networks, hardware, software, data and people work together to create usable information.
Understanding Data We’ve established that an information system is the combining of users, technology and processes to complete
a specific goal. A stakeholder isn’t only a user but is someone who has any type of interest in a particular
process. These people utilize hardware and software, typically in a network format, to process raw data into
usable information. Data is one piece of a record. Individually, some of your datum might be your first name, middle name, last
name, address, city, state, zip, phone number and occupation. When put together, we see a record.
Hardware and Peripherals The components of the system you can physically touch – the system unit (tower, desktop, laptop), internal
devices and peripheral devices (keyboards and monitors) – are called hardware. Specifics of peripheral devices are provided in many other ways, but think of them as hardware that surrounds the system unit.
Importance of managing ISR Few organizations have developed a comprehensive IRM strategy. Those that have started with some of its key
processes of information audit, and information mapping cite the following benefits:
Identifies gaps and duplication of information
Clarifies roles and responsibilities of owners and users of information
Provide costs saving in the procurement and handling of information
Identifies cost/benefits of different information resources
Actively supports management decision processes with quality information
Some of the issues that it addresses are:
Strategic – the information needs to support the implementation of business strategies; also the way that information itself can be a key lever of strategy (in terms of new product and service opportunities) Organizational – ownership, evaluation, fragmentation, isolation from processes, the politics of information Structural Integrating external and internal information, its categorization, refining it from data into classified actionable ‘chunks’.
Systems User accessibility, interface to sources, multiple databases, retrieval, usability Human Processing capability, overload incentives to share. How to Manage Information as a Strategic Asset
4. Understand the role of Information.
Information can add value to your products and services. Improved information flows can improve the quality of decision making and internal operations. Yet many managers do not fully understand the real impact ofinformation – the cost of a lost opportunity, of a poor product, of a strategic mistake – all risks that can be reduced by using the appropriate information.
5. Assign Responsibility for Leading your IRM Initiative.
Developing value from information resources is often a responsibility that falls between the cracks of several departments – the user departments in different business units, and corporate planning, MIS units or librarians..
6. Develop Clear Policies on Information Resources
Develop policies for ascertaining information needs, acquiring and managing information throughout its life cycle. Pay particular attention to ownership, information integrity and sharing. Make the policies consistent with your organizational culture.
4. Conduct an Information Audit (Knowledge Inventory). Identify current knowledge and information resources (or entities), their users, usage and importance. Identify sources, cost and value. Classify information and knowledge by its key attributes. Develop knowledge maps.
5. Link to Management Processes.
Make sure that key decision and business process are supported with high leverage information. Assess each process for its information needs.
6. Systematic scanning.
Systematically scan your business environment. This includes the wider environment – legal and regulatory, political, social, economic and technological – as well as the inner environment of your industry, markets, customers and competitors. Provide selective and tailored dissemination of vital signs to key executives. This goes beyond the daily abstracting service provided by many suppliers.
7. Mix hard/soft, internal/external.
True patterns and insights emerge when internal and external data is juxtaposed, when hard data is evaluated
against qualitative analysis.
7. Optimize your information purchases.
You don’t have to control purchasing, but most organizations do not know how much they are really spending on external information.
8. Introduce mining and refining processes.
Good information management involves ‘data mining’, ‘information refining’ and ‘knowledge editing’. You can use technology such as intelligent agents, to help, but ultimately subject matter experts are needed to repackage relevant material in a user friendly format. One useful technique is content analysis, whose methods has been developed by Trend Monitor International in their Information Refinery, and is used in the analysis of services. The classifying, synthesizing and refining of information combines the crafts of the information scientist, librarian, and business analyst and market researcher/analyst. Yet many organizations do not integrate these disciplines.
9. Develop Appropriate Technological Systems
Continual advances in technology increase the opportunities available for competitive advantage through effective information management. In particular, intranets, groupware and other collaborative technologies make it possible for more widespread sharing and collaborative use of information. Advances in text retrieval, document management and a host of other trends in knowledge management technologies have all created new opportunities for providers and users alike.
10. Exploit technology convergence.
Telecommunications, office systems, publishing, documentation are converging. Exploit this convergence through open networking, using facilities such as the World Wide Web, not just for external information dissemination but for sharing information internally.
11. Encourage a Sharing Culture
Information acquires value when turned into intelligence. Market Intelligence Systems (MkIS) are human expert-centered. Raw information needs interpretation, discussing and analyzing teams of experts, offering different perspectives.
Information as a resource
Traditionally the following 3 factors can be termed as essential in any economy:-
1. Human Resource (labor)
2. Finance (capital)
3. Raw materials
Over the past 2 decades information has come to be recognized as another factor of production. Businesses require information about their competitors, their suppliers, customers and standard and market trends. Information is a resource on its own, as well
as an asset to other. It falls within the resource hierarchy which starts with date, which leads to information,
coming together as knowledge and resulting in wisdom. The final step is the integration of the knowledge into wisdom, which is information which has been made useful by theory relating the bits of knowledge to each other.
There are 6 characteristics of information as a resource:-
1. Information is expandable:
Its recognized that for specific purposes information may wear out but in general the more we have, the more we use and the more useful it becomes.
2. Information is compressible
It’s possible to concentrate, integrate and summarize information for easier handling.
3. Information is substitutable
Information can and does replace hand, labor and capital. It’s the use of computers and telecommunication that aids in these phenomena.
4. Information is transportable
Information can be tapped into just about anywhere, this has led to the idea of being remote as much more difficult to achieve since people and information can e taken to the remotest of places.
5. Information is diffusive
These are the ability to information leek. This leakage allows us to have more and more of us to have it.
6. Information is shareable
No exchange transaction of information can take place, only sharing transactions and this leads to an entire sharing environment.
Information Society
Definition;
An information society is a society where the creation, distribution, uses, integration and manipulation of information is a significant economic, political, and cultural activity. The aim of the information society is to gain competitive advantage internationally, through using information technology (IT) in a creative and productive way. The knowledge economy is its economic counterpart, whereby wealth is created through the economic exploitation of understanding. People who have the means to partake in this form of society are
sometimes called digital citizens. This is one of many dozen labels that have been identified to suggest that
humans are entering a new phase of society. The markers of this rapid change may be technological, economic, occupational, spatial, cultural, or some combination of all of these. Information society is seen as the successor to industrial society.
The characteristics of information societies Information societies have three main characteristics.
1. Information is used as an economic resource. Organizations make greater use of information to increase their efficiency, to stimulate innovation and to increase their effectiveness and competitive position, often through improvements in the quality of the goods and services that they produce. There is also a trend towards the development of more information- intensive organizations that add greater amounts of value and thus benefit a country’s overall economy.
2. It is possible to identify greater use of information among the general public. People use information more intensively in their activities as consumers: to inform their choices between different products, to explore their entitlements to public services, and to take greater control over their own lives. They also use information as citizens to exercise their civil rights and responsibilities. In addition, information systems are being developed that will greatly extend public access to educational and cultural provision.
3. The development of an information sector within the economy. The function of the information sector is to satisfy the general demand for information facilities and services. A significant part of the sector is concerned with the technological infrastructure: the networks of telecommunications and computers. Increasingly, however, the necessity is also being recognized to develop the industry generating the information that flows around the networks: the information-content providers. In nearly all information societies, this information sector is growing much faster than the overall economy. The creation of individual information societies is taking place within a much greater, international process of change. Partly this is because the developing information systems are global, or at least international, in their reach: satellite broadcasting systems do not recognize national boundaries; telecommunication networks
provide connections between countries and continents, while the Internet is perhaps the ultimate example of a
global system.
Both developed and developing countries are being transformed into information societies. Most of them are concerned to use information to improve their relative competitiveness or, at least, to retain their position in an increasingly competitive global market. The development of information societies represents a series of attempts to achieve more general economic and social advance.
There is a concern, however, that the shift towards information societies will increase the gap between the developed and the developing countries. To counter this, the World Bank has recently launched its Information for Development initiative.
Challenges of Information societies
Methodological issues: defining and measuring the information society
It is proving very difficult to define and describe in quantitative terms information societies. We have seen that it is possible to identify some common characteristics of information societies, but it is not atall easy to go beyond generalized definitions, such as: an information society is one in which information is used intensively as an aspect of economic, social, cultural and political life. This presents
a major problem for statisticians who have to collect the data that governments need for economic management.
It is more difficult, however, to define and measure the information activity that takes place within organizations outside the information sector.
The matter is further complicated by the intangible nature of information. It is a good that does not easily fit into the economists’ scheme of things. Its value can vary widely, particularly over time, which makes it very difficult for accountants to value it for company balance sheets. Also, the value of information, unlike most other goods, does not decrease as it is consumed; indeed, the value may increase as one piece of information is added to others.
The globalization of the information sector poses further problems. Someone working in Africa can use the Internet to obtain information about a firm operating in Europe that has been compiled by an American-owned information company based in Switzerland using a database that was compiled by Eurostat, the statistical arm of the European Commission. Who regulates the information? Under which set of laws is it collected, compiled, delivered and consumed. If the user has to pay for the information, where does the revenue go? Which governments are entitled to levy a sales tax on the information? To which set of national accounts should the financial transactions be credited? It is possible to arrive at answers to most of these questions, but in doing so we raise further questions about the ability of our
economic and statistical systems to cope with the changes that are taking place
