Information Utilization And Production

Refactored from a letter addressed to Prof. Davenport, dated May 8, 1996

Relax, you are not crackers. Your column in CIO, May 1, 1996; is on the right track. In fact, the topic is not even speculative. There are fundamental laws that govern the fate of groups who do, or do not, interact properly with their information. The field of information science, coupled with systems thinking and control systems engineering and flavored with cognitive psychology, give us the rules.

From a systems viewpoint

A Goal-seeking System must have the following capabilities:

Goal G Triggers T Energy E Competence C Statusing S Feedback G-S

The primary measure of achievement for a Goal-seeking System is Goal Attainment.

Among other measures of achievement are:

Sensitivity to disturbance and Stability limits.

The in-process factors which modulate achievement include:

 Alignment with Context,
 Communications style,
 Number of elements or loops and
 Competence Decrement under load.

A sustainable enterprise must be a goal-seeking system

Because any lesser order system (level of intelligence) probably will not yield the productivity and innovation required to sustain sufficient market standing and liquidity.

A system is made of components which interact in specific ways

The set of components that are fundamental to a sustainable business enterprise are:

Mission -- Statement of enterprise purpose and role. Justifies the existence of the enterprise.

Vision -- Describes the enterprise meaning. A single, clear expression of what the effort is all about. A vision statement often uses metaphor to communicate meaning.

Resources -- Cash and other real assets.

Policies -- the rules by which the enterprise allocates resources, conforms to norms and standards and attempts to control its politics. Used to bound the permissible forms of processes and cultural behavior.

Processes -- the set and sequence of activities by which the enterprise applies information, time and resources to honor all inputs, add value, and generate all outputs. (Not all activities will add value directly. All valid ones will trace to a value-adding activity. Others represent unnecessary activities -- waste.)

Information -- the usable part of the enterprise's knowledge base. Also includes the technology (know how) base. Leverages the data stored in the people, information system, library and other places.

Systems -- the mechanisms to store, process, and move both materials and information throughout an organization.

Culture -- "how things are done around here." The beliefs and values, the rituals, the symbols, the recognition's and rewards. Includes the political power patterns and dances.

People -- the total roster of your enterprise. Includes the Board of Directors. Also, and any other group whose decisions directly influence enterprise achievement.

Products -- one vehicle for transmitting added value to customers. Includes hardware products, software products and information products.

Services -- the other vehicle for transmitting added value to customers.

The capability of each of the components is important

If you have better components than does your competitor, you may be better off. However, systems theory assures us that the competitiveness of your business is largely determined by the nature of the relationships among the components rather than by the individual prowess of the components. Lesser capable components that interrelate well can beat a competitor who has superior components that interrelate ineffectively.

'''The name of the game for a business in dynamic markets, regulations and competitors is LEARNING.

He who learns fastest, prevails.

Ring's Rules for the design of sustainable enterprises:

Rule 1 Data is information only if it is adequate, accurate and timely from the user's viewpoint.

Rule 2 A data base is an information source only if the users have awareness and access.

Rule 3 Staff expertise is an information source only if individuals participate and share.

Rule 4 Enterprise productivity is proportional to the flow rate of information (as well as materials) throughout the enterprise.

Rule 5 Enterprise innovation is proportional to the morph rate of information source and sink patterns across the enterprise.

Rule 6 Because systems lose value with time and usage they are a poor investment unless they leverage:

 a) the amount of value added
 b) the rate of adding value
 c) are easily co-evolved to align with the business needs.

Rule 7 People are the primary components that accomplish enterprise learning and innovation.

Rule 8 People relationships and competencies are key.

Rule 9 The business system must be designed to foster the required rate of learning and innovation and must be self-measuring to demonstrate that it is doing so.

Importance of Information Behavior Management

Prof. RudolphStarkerman?, an expert in multi-attribute control systems, has modeled, simulated and measured the achievement levels of "multi-party systems carrying out processes in attempt to reach a goal." He shows that one factor stands out far above the rest -- the style of "interpersonal" relationships between the parties. Given otherwise identical companies in identical markets with identical resources, one company can underperform the other by over 5 to 1 depending on the ways its stakeholders share information and co-learn.

Client server, fiber optics, data warehousing and other current IT favorites as well as BPR and TQM do not have that degree of leverage on effective information sharing and learning. Object technology can but is being largely misused in this regard.

Interestingly, it is the technical folk, the majority of IS staffs, who are fartherest from interacting with their information intelligently. But they can learn -- and they don't have to suffer touchy-feely teambuilding sessions to do it.

Hope this helps. Literature references can be provided if you are interested. Keep up the good work. -- JackRing

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