NB: I’m using “information” in an all-encompassing context in this post so that I don’t have to differentiate between data, content, and information.
Information is a tool; no one buys a tool for the sake of the tool. People buy tools for what can be produced with them. Information has inherent value that can’t always be consistently, reliably, and definitively quantified.
On September 26, 2013 I participated in a Tweetchat moderated by AIIM’s intrepid community manager, Bryant Duhon. Bryant managed to wrangle up a bunch of us to discuss the value of information; you can read the unedited wrap up here. Participants were a bunch of smart people that I highly recommend following on Twitter (you can get to them via the wrap up link).
We were supposed to be chatting about various aspects of the value of information. What became abundantly clear, really quickly, was that this is no easy task. Most of what was said was more about the cost of information (cost of creation/acquisition, cost of lost info, cost of unsecure info, etc.). We all agreed that information is an asset, but how do you assign a dollar value to it?
There was mention of things like increased productivity as a result of systems deployed. However, even that does not quantify the value of the information itself. On the other hand, it`s fairly obvious that information that can`t be accessed has, at best, zero value. At worst it has a negative value (or value to your competitors) because it’ll be used against you.
For a couple of days after the Tweetchat I was thinking about how I would go about assigning value to information. What really struck me is that the value of information is not fixed. Whether it’s financial statements, my resume, a maintenance handbook, marketing brochures, etc., they have no value until something is done to achieve an outcome. Even then, the value wouldn`t necessarily be the same for all stakeholders.
My resume is a tool that gets me a job; is the value of the resume the same to me as it is to my employer? What about to the head hunter that effected the hiring? My resume has potential value. In order to realize the value something needs to be done with or to it.
Corporate financial statements have a different value depending on who is reading them, and for what purpose. Even as the issuing organization, the value changes depending on the purpose. In one case the value of the financials is in avoiding sanctions for failure to file and meet regulatory obligations, in another the value is in the amount of investment to be had from potential investors.
When we (vendors, systems integrators, consultants) talk to clients and prospects about solutions, ROI, and information’s value, we’re not talking about changing the inherent value of information; we’re talking about using, handling, and controlling information. When a client of mine saved $250K per year by changing how invoices are handled, it didn’t change the value of the invoices, it reduced the labour costs of processing the invoices.
There are definitely cases where having good information leads to good business outcomes, and we pretty much all agree that without information we’d be in deep doo-doo. But maybe our attempts at trying to assign value to information should stop at “it’s worth a lot, but we can’t always put a number on it.” Maybe information is one of those resources whose value is only quantifiable after the outcome has been determined or when we’re missing it.
Perhaps what Damian Webber said about processes applies to information as well; “processes have no value – they contribute to something that has value”. Maybe we need to start thinking of information in terms of raw material; it`s only what you do or create with it that has true, quantifiable value.