Information and our models of reality

So I am going back to our business intelligence and systems theme and getting a little more philosophical here. I wanted to explore information at a more fundamental level. Some of this is probably way over my head, but hey these are just the things I think about at night (and yet I wonder why my family thinks I am weird!).
 
I was thinking about how information is related to our mental models. At the core, most information is really an abstract model of reality that we use to understand things. We use the information that we have to construct a mental model of how the world works. Once we have that model in our heads we take actions based on what our particular mental models say will lead to a desired outcome. The problems and/or opportunities arise when we get information that contradicts how our mental model tells us things should be working. What should we do with the fact that there is a difference between what our mental model predicts for the outcome and the data that we are looking at?

I would argue that one of the first things most people do is assume that there was an error in how the data as abstracted up to the level that we are looking at. An example here might help. Assume that you are looking at an accounting report and you see that one of your main divisions reported only five dollars in revenue for a month. Last year that same division reported five million dollars of revenue. Your first assumption is probably to assume that there is an error in how the data was put into the system and moved up through the abstraction chain to your report. The first and usually logical step we want to perform when we see a difference is to trace back through the levels of abstraction to ensure there were no errors. In other words we (or someone we delegate to) drill down through the details to ensure that there are no errors from an overall system perspective.
 
Let's assume that we fail to find any errors in how the data was put into the system or in any of the calculations used to roll the information up to our report. So what does the difference in the number in the report imply at this point? The key is the difference in the numbers - it implies that something in our mental model of how that division is supposed to work is out of alignment compared to reality. So the next step then is to look at our mental model and make adjustments so that it better fits reality.

My thought is that most people today don't have a good understanding of their mental models that they are using and so don't understand where the best point is to make adjustments. From a business intelligence perspective I see two challenges. The first lies in understanding how BI tools and processes can be used to help people validate information that flows through the systems so that they know the data is accurate. The second challenge is how to we help users understand the mental models that are in use when they are looking at data and where the best leverage is for making changes.

Infomation and Systems

 I have been reading about "systems" over the last few weeks and I started to wonder how Business Intelligence (BI) software might be used from a system perspective. I came up with three ways that I see BI software being used within an organization. First it can act as monitoring tool for a company's past actions to see if they have provided the desired results. Secondly,  it can provide predictive information that will help determine an entirely new course of action for the company. Thirdly, it can provide information about where the greatest source of leverage is within a company for changes. Those might be broken down as follows:

1.) Monitoring - operational, financial information
2.) Predictive - strategic,  budgeting, forecasting
3.) Leverage - metadata about the company as a system

The first two are pretty normal uses of BI software, but the third idea might be worth more thought.

Turning Information into Action

What do people actually do with information once they have it? If a user has run a report with the information they required how do they  use it and take action on it? For example, if you review a report of your companies account balances and find an error that shows an overstatement of revenue in a certain account, what would you do with the information? Probably one of the following actions:

1.) You could send the same information to someone else so that they can take action on it.  You can send it via email, print it out and carry it over to them personally, or call the person on the phone and relay the information verbally.

2.) You could drop everything you are currently doing and log into the accounting system and figure out what you need to do to make any changes.

3.) You might schedule time to work on the problem at a future date.

4.) You could question the validity of the information and review additional information in order to validate
why the number is what it is.

5.) You could ignore the information and take no action.

6.) Store the information for future reference.

Broadly here are the actions that one might take:

1.) Delegate

2.) Fix

3.) Schedule

4.) Analyze

5.) Ignore

6.) Store

So one of the interesting things to think about is how the information tools that you use enable or discourage those different types of actions. Different types of users are going to take different actions based on their role within an organization. Making it easy for people to act on information is critical to success in setting up any information architecture.

Welcome

Welcome to Intelligent Information Informs! My goal for this blog is to provide news, ideas, and thoughts on  what information is and how it's used in today's world. In our knowledge centric world understanding how information is created, used, stored and destroyed is more important than ever before. I work for a company called Wynne Systems that sells Business Intelligence software so I am knee deep in this subject everyday and I see the true value of many different aspects of information. Just remember - intelligent information informs and that's what my goal with this blog is.