Difference between Data , Information , Knowledge , Wisdom

Although the terms dataand information are often used interchangeably, they don’t mean the same thing. Neither do wisdom and Knowledge. In fact, these terms represent different phases in a cycle or perhaps building blocks toward organizational enlightenment.

1- Data

It is generally described as facts and figures without context or interpretation. A string of figures could be an account number, a charge card number, an inventory number, or a number signifying a volume of transactions.

Data without a descriptive definition or context is meaningless.

It is the raw material from which information is derived and the basis for intelligent actions and decisions.

But not all is created equal. Some is essentially extraneous material that takes up space and obstructs access to desired data. To enhance efficiency, it must be effectively gathered, organized, and stored so it is easy to access and transform into meaningful information.

It may be gathered in variety of manners. Common tools for gathering and recording data include data sheets, bar-code readers, optical character readers, direct process inputs, and voice-activated entry.

2- Information

Information is culled from patterns in the data. It provides meaning and understanding from data. In other words, information is data in context, useable information. According to Larry P. English, author of Improving Data Warehouse and Information Quality, information quality measures three components:

1. Clear definition and meaning of data
2. Correct value(s)
3. Understandable presentation (format)

Nonquality of any of these components can cause a business process to fail or a wrong decision to be made. English finds that information may be represented as a formula:

Information = Data + Definition + Presentation

3- Knowledge

Knowledge is considered “information in context” or “information in action,” and it can be tacit or explicit.

· Tacit (informal, uncodified) information is in the heads of employees, the experience of customers, the memories of past vendors. Tacit knowledge is hard to catalog, highly experiential, difficult to document in any detail, ephemeral, and transitory.

· Explicit (formal, codified) information is contained in books and documents, white papers, databases, and policy manuals.

Both types of knowledge are important. English contends that knowledge means understanding the significance of information and may be represented by the following formula:

Knowledge = People + Information + Significance

Knowledge in and of itself won’t advance the organization. It has power only to the extent that people are able to act on their knowledge.

4- Wisdom

In keeping with his other concepts, English offers this formula for calculating wisdom:

Wisdom = People + Knowledge + Action

Wisdom allows organizations to exploit the value of their resources toward accomplishing the corporate mission. To engender wisdom, people must be provided training with quality information and allowed to act on and experience the outcomes of their decisions.

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