Brief Outline Of The Problem

1. Introduction:

1.1 Background:

In today’s world of business, information is considered as wealth. The more an organization knows about a particular course of action, the better it is equipped to get on such a pursuit and almost certainly yield success. Information is an empowering advantage that enables an organization to optimize and maximize itself and at the same time move towards their goals and missions. It allows contact with other organizations whether in a competitive or alliance stance (Claudia Klausegger et all. 2007).

Managing all the information is the critical function of any organization and needs to be efficiently managed, otherwise it will lead to “information overload”, which then will contribute to inefficiencies, rising costs, and hinders in business success (Varian, Hal R, 2000).

Information is gathered around the key functions of management such as planning, organizing, staffing, controlling and communicating. Among these functions, MIS is closer to the controlling function as it provides feedback on organizational performance and helps in monitoring. Information management provides a practical insight into the techniques used in assessing the impact of information technology in a business. It uses technology for collecting, processing and considering information with a goal of efficient management (Gordon B. Davis, 2003). Information and communication systems address the absolute need for effective use of information and communication technologies in monitoring and acquiring data, computer-based modelling, and decision support and knowledge-based systems.

1.2 Brief outline of the problem:

There so many new technologies out there in so many ways that one may now feel an overload of information, hence, achieving a diminishing marginal utility status in our brains. We have now therefore a need to organize and reorganize these pieces of information constantly as to be able to keep track of which of them are valuable to us and which ones are not.

1.3 Approach and Methodology:

All the above will be achieved through desk research or secondary research, the use of recommended materials and lecture notes, internet and related industries.

2 Analyses:

2.1 The glut of information:

Attention is undoubtedly one of the most scarce resources around the globe in both public and private sector organizations and increasingly so. There is load of information all around us, on our hard drives, our organizations’ databases, the Internet, printed documents, commercial publications, emails, subscription-based services yet we’re frustrated when trying to locate and use it (Kevin A. Miller, 2004).

Organisations are being turned inflexible due to excessive growth or mismanagement of information – this state of overloaded information is called ‘the information glut’. Constant introduction of the information and communication systems does not make the situation any better; in fact it is layered over existing systems thus significantly increasing the information load. Therefore, planning and co-ordination of information and communication become of supreme importance to business success (Guus Pijpers, 2010).

2.2 Dearth of attention:

Attention involves understanding how to work within an overabundance “information competition”, whether interfacing with customer, co-workers, or our own priority list. Leaders of organization, for example, must manage attention on several levels. They must direct their own attention to particular project and information, they must focus the attention of their employee on the most profitable activities, and they must attend to the most important buyers, suppliers, and other stakeholders. If the organization is to achieve its goal effectively, the need of managing its information is of critical importance (Iselin, E. R. 1999). The over increasing amount of digital information should not be viewed as a simple data resource or storage burden. Rather, it is an asset which holds an organization together. With the right approach, information growth can stimulate growth in the business. Without it, information can be a burden that contributes inefficiencies and rising costs, hinders growth and stiles innovation (Hanka, 2000).

2.3 The general causes of information glut include:

The main reasons for information overload at organizational and interpersonal levels can be related to five constructs.

Organizational design

Information processing capacity

Personal characteristics

Nature of the task or process

Information technology

Usually information overload emerges not because of one of these factors but because of a mix of all five causes.

2.3.1 Organizational design

Organizational design of a company is an important factor influencing the occurrence of information overload. Changes in the organizational design, for instance, due to centralization or because of a move to interdisciplinary teams, can lead to greater information processing requirements (IPRs) because they create the need for more intensive communication and coordination (Bawden, 2001). On the other hand, better coordination through standards, common procedures, rules, or dedicated coordination centres can reduce the IPR and positively influence the information processing capacity (IPC).

2.3.2 Information processing capacity

The nature of information itself is the next important factor after organizational design. It is not only the amount of information that determines information overload, but also the specific characteristics of information, such as the level of uncertainty related to information and the level of ambiguity, innovation, complexity, and intensity (Schneider, 1987). The quality of information can have great effects on the likelihood of information overload. Improving the quality (e.g., conciseness, consistency, comprehensibility, etc.) of information can improve the information processing capacity (IPC) of the individual, as this enable individual to be able to use high quality information more quickly and better than unstructured and unclear information (Sorohan, E. G. 2000).

2.3.3 Personal characteristics

The individual and his or her attitude, qualification, and experience are another important factor. Person’s capacity to process information is limited, recent studies include specific limiting factors such as personal skills, the level of experience, and the motivation of a person. Personal traits thus directly affect IPC (Swain & Hanka, 2000).

2.3.4 Nature of the task or process

Another important factor is the tasks and processes that need to be accomplished with the help of information. Complex tasks or processes directly increase the IPR. The less a process is based on reoccurring routines and the more complex it is in terms of the configuration of its steps, the higher is the information load and the greater is the time pressure on the individual (Bawden, 2001; Grise & Gallupe, 1999, 2000). The combination of these two factors that increase the IPR can lead to information overload. Information overload is inevitable if the process is frequently interrupted and the concentration of the individual suffers as a consequence (Speier et al., 1999).

2.3.5 Information technology

IT and its use and misuse have become another main reason of information overload. The development and deployment of new information and communication technologies, such as the Internet, intranets, and extranets, but especially e-mail, are universally seen as one major cause of information overload (Bawden, 2001). Closely related to the problem of e-mail overload is the discussion of pull versus push technologies and whether they have a positive or negative impact on an individual’s IPC and IPR. Pushing selected pieces of information to specific groups reduces on the one hand their information retrieval time, but increases on the other the amount of potentially useless information that a person has to deal with (Edmunds & Morris, 2000). In addition, it causes more frequent interruptions. Information technology can thus potentially increase the individual’s IPC while at the same time increasing the IPR.

2.4 Consequences of information glut:

2.4.1 Missing productivity increases:

Network technologies were expected to bring significant improvement in worker productivity when they were first introduced. However, the continue introduction of communication systems has led to the “information glut” and thus has failed to establish a significant relationship between information technology and productivity growth (Van Zandt, 2001). People have even started to wonder whether the introduction of information technology has actually had a negative effect on productivity level. It has also been noticed that the time and resources consumed in generating, distributing, processing, and sorting out paperwork adds no value to business and deflects people’s attention away from productive work (Kock, 2001).

2.4.2 Increased Health Problems and Job Dissatisfaction

There is a growing concern that information gluts may be contributing to employee health problems and increased job dissatisfaction. To determine the extent of the problem, Atlas Business Information conducted a survey of 1,300 managers. They published startling results in December 2006 report. One in four managers admitted to suffering ill health as a result of the amount of information they have to handle. Moreover, two-thirds of managers said, the stress from information overload increases tension with colleagues and lowers job satisfaction (Booth S et all., 2003). These figures show that information gluts have become a serious problem, impacting workers in unexpected ways. Companies and individuals would be well-advised to start making a conscious effort to find effective ways to deal with information overload (Wurman, R. S. 2001).

2.5 Overcoming the information glut:

2.5.1 Countermeasure against information overload:

Study on information overload not only discusses major causes and effects, but also proposes possible effective countermeasures to address the issues related to information overload. These countermeasures range from general suggestions concerning attitude to very specific software tools (such as filtering agents, automatic summarizers or visualization algorithms) that help to process large amounts of information.

A list of countermeasures are mentioned below,

Personal factors

Information characteristics

Task and process parameters

Organizational design

Information technology application

With regard to information itself, information overload can be reduced if efforts are made to assure that it is of high value, that it is delivered in the most convenient way and format (Simpson & Prusak, 1995), that it is visualized, compressed, and aggregated (Meyer, 1998), and that signals and testimonials are used to minimize the risks associated with information. On the individual level, it is important to provide training programs to enhance the information literacy of information consumers and to give employees the right tools so that they can improve their time (Bawden, 2001) and information management (Edmunds & Morris, 2000) skills.

As far as improvements for the organizational design are concerned, various authors take on conflicting positions. While earlier contributions stress the importance of self-contained tasks and lateral relationships, more recent studies see this focus on collaborative and interdisciplinary work as a cause rather than as a countermeasure of information overload (Bawden, 2001). If the cause of information overload relates to process problems, several authors suggest standardization of operating procedures (Bawden, 2001; Schick et al.), collaboration with information specialists within the process teams (Edmunds & Morris, 2000), and use of facilitators or collaborative tools (such as virtual team rooms) as “process enablers” for cognitive support (Grise & Gallupe, 1999/2000).

Finally, at the level of information technology, several authors advocate the use of intelligent information management systems for fostering an easier prioritization of information (Bawden, 2001; Meyer, 1998; Schick et al., 1990) and providing quality filters. Examples of such intelligent systems are decision support systems (DSS) that reduce a large set of options to a manageable size. However, a systematic methodology (comparable to other standardized problem solving approaches) to prevent or reduce information overload is still missing. Such a methodology should combine insights from various disciplines to provide effective countermeasures that can be adapted to various contexts. For example, insights from consumer research on the importance of branding for reducing information overload can be used for new MIS instruments

2.5.2 Economics of Attention:

Information is not the scarce resource, but attention is. The success of some future business model will be based on the economics of attention. Perhaps the most novel approach is to adjust over expectations on how much information do we need. The most important requirements in making a good decision do not necessarily lie in gathering large quantities of information, but rather taking time to absorb and process information, reflect and analyze, and discuss the issue at hand with others. Which means businesses must compete on people’s time and focusing on bringing quality information to people in a meaningful way (Heylighen, J. (1999).

2.5.3 Spending on information technology innovation:

Information itself is meaningless without some way to locate, filter, organize and summarize it (Bawden, 2001). Innovation economists argue that the long-term benefits of investments, particularly in innovation, outweigh the costs of temporary budget deficits. Most organisations continue to stress on the importance of innovation in information technology despite tighter economic circumstances. Organizations that have decreased the share of their IT budget are more likely to feel the impact of the “information glut” than those where the share of IT budget set aside for innovation has increased (M. Gordon Hunte, 2007).

2.6 How information technology improve decision making

Solution to information glut lies within the problem itself. Though constant introduction of advance technology adds to information glut, yet it will continue to offer the exciting solutions to information overload (M. Gordon Hunte, 2007).

Information has become one of the main assets in information era. The efficient use of information is significant in determining the success of a certain organization. Making awareness of information value and the ability to manage information organization-wide will have great impact on organization progress results. Since information is used in every feature of business and generated in every process, a centralised supervision function is needed to structure, combine and distribute it effectively and efficiently. Where the finance department monitors and manages the financial aspects of organization and the legal department handles all legal affairs, the Information Organization should manage this important business asset (Booth S et all., 2003).

MIS for example, aids the organization in effective and efficient decision making. The organizational data, like information on the processes, standard operating procedures and audit preparation methodology, are all tabulated and presented in the forms of reports. Also the internal controls for each department that list the flow of work between employees, the authority-responsibility relationships; all are listed by the MIS (Jay Liebowitz, 1999).

An organization that uses MIS is able to record, process, and tabulates all important business transactions. As and when need arises, the organization is able to incorporate necessary changes and improvements to its areas of concern. For example when an organization sees that the actual and projected sales figures are not in tune with each other, it can take steps to make changes and thus align the two figures (Bawden, 2001).

MIS facilitates informed decision making. MIS usually represents a number of options from which the organization usually picks the best trade-off for sales, operations and other strategic areas. The top management also analyzes whether its resources are being utilized optimally (Horder, W. (2004).

A two-way communication flow is greatly enhanced by MIS. The management freely tells its employees their jobs, and the ways and means in which they are to accomplish the tasks entrusted to them. The employees also in turn discuss their doubts, concerns and problems (Edmunds and Morris, 2000).

2.6.1 Real case scenario:

The way an organization chooses to design its decision making rules are one of the most fundamental aspects of organization’s internal design. PepsiCo for example, has several different business units running independently. Running all the business units under different entities makes it harder in making the decision effectively, so they come up with strategy of “power of one”, though they have been successful so far in some of the areas in bringing the activities together under the same head but still there hasn’t been much success in bringing a unified IT infrastructure for all the business units, that no doubt is very crucial in making effective decisions for organization as a whole (pepsico.com).

2.6.2 IT supports decision making

One of the ways IT is supposed to add value to the business is by supporting better decisions. Let’s take the example of PepsiCo’s, Despite under the strategy of “power of one” PepsiCo’s business units are using different and separate database and IT infrastructure, working independently, and that resulted in lack of central decision making authority, work duplication and cost a lot to the organization. They really need to implement an integrated IT infrastructure and software package that can bring them all together and help them making unified decisions for all the business units.

2.6.3 Enterprise wide-system

Choosing a right type of IT infrastructure by itself is an integral part of the organization’s decision making that help organization in further decisions. An enterprise wide system can be really helpful to turnout major challenges in any organization. They allow companies to replace their existing information systems, which are often incompatible with one another; with a single, integrated system. They provide a single system that is central to the organization and ensure that information can be shared across all functional levels and management hierarchies for a better decision making (Horn Nord and G.Daryl nord 1995). In addition, it is increasingly the case that organizations are seeking to embed much of their organizational knowledge in complex information systems. Adapting this perspective, enterprise systems are presented as more effective and efficient ways of representing the knowledge necessary to manage the contemporary organizations. Also the enterprise Information Systems provides a technology platform that enable organizations to integrate and coordinate their business processes.

(Charalambos Spathis and John Ananiandis 2005)

2.6.4 Enterprise information system

EIS is an interrelated set of information system supporting the decision making in the organization, by providing the following performance features.

Greater quantities of information:

Improved quality of information:

Tools to manage and analyze the large quantity of data.

More efficient communication and data sharing:

Mechanisms for feedback and learning:

Facilitating planning, control, coordination and decision making:

(Horn Nord and G.Daryl nord 1995)

2.6.5 Executive Support System:

There should not be any inefficiency in decision making from the top level at PepsiCo, if they have and managing an effective executive support system. As PepsiCo is facing some problems while making decisions effectively across the units, that shows that they are not taking the full benefits from their ESS. By implementing and managing the ESS effectively will help company’s top managers to attain easy access to their internal and external information which is relevant to strategic decision making and other executive responsibilities

Executive support system can provides variety of advantages to an organization to ease up its operations. Such as;

Easy for upper-level executives to use, extensive computer experience is not required in operations

Provides timely delivery of company summary information

Information that is provided is better understood

Filters data for management

Improves to tracking information

Offers efficiency to decision makers

(Jeretta Horn Nord and G.Daryl nord 1995.

3. Conclusion and recommendation

Based on the discussions above, it is found out that information is a key resource of the organization, together with people, finances and material assets. Thus, it is concluded through effective information management of the organization’s resources and systems, organization administrators can add value to the services delivered to customers, reduce risks in the organization’s business, reduce the costs of business development and service delivery and encourage improvement in internal business processes and external service implementation. On the other hand, it is recommended that when developing an information system, just to make sure it produces important information and not data. It is better to build a report that is ideal for a specific need then to make a report based on a predefined concession between several users. The shaped information will have value and increases insight into information needs and the way the business is looked at. Adding more and more information to the system and solving the problems as they occur will eventually lead to a system as mentioned. In fact, that is the way any functional Information System is developed. Having an experienced team helping you take the first steps and educating your staff in the first period can make all the difference. We can probably all agree on a few important points. Timely valuable information can improve decisions and outcomes. Information is potentially valuable if it could improve outcomes, but to realize that potential the intended beneficiary has to receive it, attend to it, consider it and act upon it in time. In situations where human processing capacity is limited, where data glut is possible, and where communication bandwidth is limited, we must give priority to high-value bits. The only way to do this is to know which bits would materially affect the receiver. This requires understanding the operator’s