There’s an Important Difference Between Data and Information

You can’t have IT without information, you can’t have information without data, and technology is what creates data so that you can better use your company’s technology to increase sales. Got it? Understanding the flow of data can be confusing. It’s important to have a handle on it so you can leverage your data for the success of your business.

First off, we have to mention that most businesses use the two terms “data” and “information” interchangeably. This is true for Macro Systems and it’s an acceptable practice within the industry, especially for marketing purposes. Although, to get technical about it, there’s a significant difference between the two terms.

Essentially, data is raw numbers collected by technology. Data looks like a bunch of ones and zeros, and if one were to read data, it would make zero sense. Subsequently, information is data that’s been processed and interpreted so that meaning can be attributed to it. Once you, the business owner, understand the meaning of the provided information, you can use the information to make informed decisions for your business.

This is why it’s so important that your company’s data-collection process is sound. Otherwise, your information may not be accurate, which will in turn lead to poor decision making. As you can imagine, how data goes from a seemingly-random number to become helpful information used to direct your organization, can be a bit of a process. If just one aspect of this process is weak, so will the end result.

One way to view this data-transformation process is with the DIKW Pyramid. This is a four-tier pyramid where wisdom is on the top and data at the bottom.

Business 2 Community provides us with a salad metaphor to describe the DIKW pyramid levels.

• Data: I have one item. The data displays a 1, not a zero.
• Information: It’s a tomato. Now, we understand the item and its characteristics.
• Knowledge: A tomato is a fruit. We can identify patterns in the information and apply them to the item.
• Wisdom: Tomato is never added to a fruit salad. There is an underlying, commonly understood principle that governs the item’s purpose.

B2C goes on to say that “bad data costs time and effort, gives false impressions, results in poor forecasts, and devalues everything else in the continuum.” You can see why it’s in your company’s best interest to place a high priority on having data quality software that ensures your data is as reliable as possible.

Additionally, if your servers and computers are functioning properly and your company’s communications are efficiently mapped out, there will be less chance of leaking and corrupting corporate data. As you can tell from the DIKW pyramid, if something were to happen to your data, you’d lose your company’s foundation. Macro Systems can help meet both of these concerns with our managed IT services and our Backup and Disaster Recovery solution. Call us at (703) 359-9211 to learn more.