The Importance Of Information In Business
In a simple sense, information is structured, processed and organised information. It gives context to individual data and allows effective decision making to be made. For instance, a single consumer’s sale in a particular restaurant is statistical data-it becomes information the company can make use of when planning out its marketing strategy.
Most businesses use information to their advantage and use it to influence decision making. It acts as a filter to separate the wheat from the chaff. Information can be used to attract customers, provide information on a product or service, and to manage internal operations more effectively. The information we provide ourselves is often limited, if not totally inaccurate. But because of its accessibility and relatively low cost, it is used widely and with good effect.
Companies are constantly trying to improve their effectiveness by getting more information to their customers, and to utilise that information to make better decisions. How much information do you need? In fact, the answer is ‘as much as you need’. Today’s modern world makes it very tempting to spend money on unnecessary details that produce little practical value; for example, the cost of a cup of coffee can tell you little about the quality of the coffee. Instead, companies should focus on what is important and go for the best quality rather than the cheapest price.
Companies sometimes make use of information to make decisions based on incomplete knowledge. They base decisions on facts that may not necessarily be true. This is especially true when it comes to recalls and accidents. Large corporations have been sued because of the actions of their employees and they were forced to pay compensation. Even small businesses are not immune to these lawsuits: small mistakes can lead to serious legal actions, and having an accurate database can help your company avoid legal entanglements.
Companies also make use of information to make decisions based on research and evidence that may not necessarily be correct. For example, if a large food manufacturing company is asked to remove trans fats from their products because they have been shown to increase the risks of heart disease, the company may decide to remove trans fats from all of their products, irrespective of the evidence that shows they are bad for you. Without this information, they would be taking a risk.
Finally, companies can make use of information to improve customer service. Having up-to-date information on your product or services can help you improve your customer service. For example, you might find that you have been losing customers because you were shipping products that were late arriving, or goods that did not get to the customer in time. By knowing the precise shipping times and delivery locations for your most important customers, you can make sure that they receive their goods on time and in good condition. This type of information could also be used to improve customer relations.