Case
Brian, a manger at a missile company, has realized he needs to figure out a better way to collect and access a variety of data. He wants to keep a diary of rumors he hears about rivals in the industry. He also wants to maintain the share price data for companies in the industry and keep track of his company’s budget and competitors’ financial statements (unaudited and audited). Finally, to plan for the future, he would like to get daily e-mails from e-mogul, which forecasts military growth. Brian wants a robust system that tracks details about the missiles for whose production he is responsible. The system should include complete specifications (e.g., numbers and types of nuts and bolts used, types of detonator, etc.) and a CAD/CAM system that allows engineers to visualize missiles from a variety of perspectives during the design stage. It should also simulate the effects of wind and rain on a missile’s flight.
Discuss the hardness of each type of data Brian would like as well as the different classes of data represented in his request.
Answer
The various types of information listed from softest to hardest are:
- rumors
- forecasts
- budget numbers
- unaudited financial statements, missile models, and simulations
- audited financial statements
- part specifications
- share price
The various forms of information are:
Content
- rumors
- forecasts
- budget numbers
- unaudited financial statements
- audited financial statements
- part specifications
- stock data
Form
Behavior
Explanation
Brian, a manager at a missile company, wants to collect different types of data. These different types of data are discussed in terms of information hardness and information classes.
- Brian wants to keep a diary of rumors he hears about rivals in the industry. This type of data is at scale 1 and it is not very hard data since it is not very reliable and accurate. Moreover, the source of the data is unidentified.
- Brian wants to keep track of companies' share prices. This type of data is at scale 10 and information hardness is very high since it is highly reliable and accurate. These data would be the same independent of the source of the data. If you get the share price data from the Wall Street Journal or a stock market website, it will be the same. So the data is highly reliable and accurate. There is no ambiguity.
- He wants to keep track of his company’s budget. This type of data will be at scale 6 of the information hardness scale.
- Brian wants to keep track of audited and unaudited financial statements of his competitors. The unaudited financial results are at scale 8 and audited financial statements are at scale 9. The financial statements are high on the scale as the source of the information is identified and it is less ambiguous as companies follow generally accepted accounting principles (GAAP). The audited financial statements are higher on the scale than the unaudited financial statements as external auditors monitor the application of GAAP. However, financial statements are not the hardest information as there are some leeways as to how GAAP standards can be applied. The debate over pro-forma earnings vs. net income is a very good example.
- He wants to get daily e-mails from the company that forecasts military growth. This type of information is at scale 3 as it represents information from an identified expert source.
- Brian wants to develop a system, which includes complete specifications of missiles. This represents content among the information classes.
- The system should also include CAD/CAM drawings of missiles. This represents form among the information classes.
- The system should also simulate the effects of wind and rain on missile flights. This represents behavior among the information classes.
