Business Information

1. Business Information Int 2 Bus Mgt Unit 1 Outcome 2

2. INFORMATION • Information is the LIFEBLOOD of every organisation. • Businesses need GOOD information to enable them to make informed decision and to operate to their maximum efficiency. • Without information a business will not survive Int 2 Bus Mgt Bus Info JW May 2009

3. What is the difference between DATA and INFORMATION? • Data is a collection of facts or quantities that has been assembled in some formal manner with the objective of processing it into specific information • Information is data that has been processed into a form that assists decision-making and planning. Int 2 Bus Mgt Bus Info JW May 2009

4. Quantitative Information • This type of Information is mostly number based. • Eg: Sales in Gap’s Glasgow branch are up by 10%. • This type of information can easily be measured. Int 2 Bus Mgt Bus Info JW May 2009

5. Qualitative Information • This type of Information is concerned with people’s feelings and opinions. • Eg. Walkers Crisps carrying out a survey on their new flavour of crisps may get responses like: “I prefer the salt & vinegar flavour”, or, “I like the new taste best”. Int 2 Bus Mgt Bus Info JW May 2009

6. TASK Identify quantitative and qualitative statements. Int 2 Bus Mgt Bus Info JW May 2009

7. QUICK TASK Look at the data below. What information could you provide to your line manager? Int 2 Bus Mgt Bus Info JW May 2009

8. Sources of Information • PRIMARY INFORMATION • Information is gathered for a specific purpose for the first time. • Information is often described as being ‘fit-for-the-purpose’. • This source of information is gathered by using questionnaire; surveys; interviews etc. Int 2 Bus Mgt Bus Info JW May 2009

9. Information is first hand Information collected is for a specific purpose It is up-to-date It is accurate No-one else has access to it Primary Information - BENEFITS Int 2 Bus Mgt Bus Info JW May 2009

10. Primary Information - COSTS • Very expensive to carry out market research • Difficult to persuade respondents to participate in a questionnaire etc • Respondents may provide false information • May be difficult for the organisation to collect the information Int 2 Bus Mgt Bus Info JW May 2009

11. TASK • Suggest how false information could impact on business decisions? • Primary information has benefits. Describe 2 of these. • Primary information has costs. Describe 2 of these. Int 2 Bus Mgt Bus Info JW May 2009

12. Sources of Information • SECONDARY INFORMATION • Information has already been gathered • Business will access this information to use it for their own purposes • Egs of this type of information are: newspapers; textbooks; magazines; the internet etc Int 2 Bus Mgt Bus Info JW May 2009

13. Less expensive to collect Easy to access Wide variety of sources of secondary information is available Quicker to gather this type of information Secondary Information - BENEFITS Int 2 Bus Mgt Bus Info JW May 2009

14. Secondary Information - COSTS • Information may not be relevant • As it has been collected by someone else it may be biased • May be out of date • Competitors can access the same information Int 2 Bus Mgt Bus Info JW May 2009

15. TASK • Secondary information has already been gathered by some other organisation. • Identify reasons why an organisation may use secondary information. • (3 marks) • Explain the costs and benefits of secondary information. • (4 marks) • Distinguish between primary and secondary information. • (3 marks) Int 2 Bus Mgt Bus Info JW May 2009

16. Sources of Information • INTERNAL INFORMATION • Data has been taken from the organisation’s internal records • Information is only available to the business • This type of information is very important as it helps businesses manage their organisation. • Egs: financial records; employee records; sales figures Int 2 Bus Mgt Bus Info JW May 2009

17. Once an organisation has been established for a number of years, accurate information can be gained. Accurate information enables targets to be set and assess whether or not targets have been achieved Internal Information - BENEFITS Int 2 Bus Mgt Bus Info JW May 2009

18. Internal Information - costs • Expensive to set up and produce employee records; wage records etc. • Someone must be given the authority to ensure that the information is up-dated regularly • New organisations may not have access to internal information Int 2 Bus Mgt Bus Info JW May 2009

19. Sources of Information • EXTERNAL INFORMATION • Information is gathered from sources outside the organisation • Examples of sources of external information are: market research; government reports; newspapers; competitor’s annual accounts etc. Int 2 Bus Mgt Bus Info JW May 2009

20. TASK What internal records are held in St Ninian’s High School. Try to think of as many as you can. Int 2 Bus Mgt Bus Info JW May 2009

21. Can give an organisation useful information on the changes taking place outwith their business environment – remember PESTEC from Outcome 1? External Information - BENEFITS Int 2 Bus Mgt Bus Info JW May 2009

22. External Information - costs • Very time consuming to gather • May be out of date • Information may be unreliable • Competitors can access same information Int 2 Bus Mgt Bus Info JW May 2009

23. What are the different presentation formats Pictorial Written Verbal/Spoken Graphical Numerical Int 2 Bus Mgt Bus Info JW May 2009

24. Written Information • Egs of written information are letters; memos; minutes; reports; emails etc • What are the benefits of this type of information? • Can be easily referred to and checked • Can identify who the information has come from • Keep a record of the information • Easy to collect Int 2 Bus Mgt Bus Info JW May 2009

25. Verbal/Spoken Information • Verbal and sound information • Egs: telephone calls; presentations; meetings; discussions etc. • What are the benefits of spoken communication? • Receive a response straight away • Ability to respond to body language if conversation is face to face • Ability to give advice and simple instructions • Enables you to ask additional questions Int 2 Bus Mgt Bus Info JW May 2009

26. Pictorial Information • Information is presented in the form of photos and pictures • The main purpose of pictorial information is to pass on information that can be easily remembered • Pictorial information makes documents more attractive and helps to further emphasise a point Int 2 Bus Mgt Bus Info JW May 2009

27. Graphical Information • Information is presented in the form of graphs and charts eg. Pie chart; bar chart; line graph • Excellent way to display complicated information • Comparisons can be easily made Int 2 Bus Mgt Bus Info JW May 2009

28. Numerical Information • Information is presented in the form of numbers – often as tables and spreadsheets • This type of information enables forecasting, calculations and comparisons to be made • Ability to compare own business with competitors Int 2 Bus Mgt Bus Info JW May 2009

29. Question for your jotter…… • Identify and describe 5 different ways of presenting information. (10 marks) • Describe one advantage and one disadvantage for each of the ways of presenting information. (10 marks) Int 2 Bus Mgt Bus Info JW May 2009

30. Uses of Information in Business MONITORING & CONTROL • Businesses will compare the actual performance of the business to their estimated (budgeted) performance • They will analyse any variances between actual and budget • Records of previous years performance will be used and any changes that have occurred will be taken into account Int 2 Bus Mgt Bus Info JW May 2009

31. Uses of Information in Business DECISION MAKING • In order to make an informed decision managers must receive up-to-date and relevant information • It is very important that the information received is of value otherwise poor decisions will be made which could cost the organisation dearly Int 2 Bus Mgt Bus Info JW May 2009

32. Uses of Information in Business MEASURING PERFORMANCE • Information enables companies to compare their performance against that of their competitors • They would want to look at: • Level of sales • Rate of staff turnover • Position in market • Success of advertising strategies Int 2 Bus Mgt Bus Info JW May 2009

33. Uses of Information in Business IDENTIFYING NEW BUSINESS OPPORTUNITIES • Enables businesses to identify the success of their current product range and decide as to how they can expand (introduce new items) • Closely analysing the market will identify opportunities to merge; takeover another company etc Int 2 Bus Mgt Bus Info JW May 2009

34. Question for your jotter……. Managers use information for a variety of purposes. • Explain the main uses of information. (4 marks) Int 2 Bus Mgt Bus Info JW May 2009