ICT: The difference between data and information

When study ing ICT it is important to understand the difference between "data" and "information". This study note tells you what the differences are and outlines the main types of information.

Data

Think of data as a "raw material" - it needs to be processed before it can be turned into something useful. Hence the need for "data processing". Data comes in many forms - numbers, words, symbols. Data relates to transactions, events and facts. On its own - it is not very useful.

Think of the data that is created when you buy a product from a retailer. This includes:

- Time and date of transaction (e.g. 10:05 Tuesday 23 December 20X3)
- Transaction value (e.g. £55.00)
- Facts about what was bought (e.g. hairdryer, cosmetics pack, shaving foam) and how much was bought (quantities)
- How payment was made (e.g. credit card, credit card number and code)
- Which employee recorded the sale
- Whether any promotional discount applied

At its simplest, this data needs processing at the point of sale in order for the customer to receive a valid receipt. So the data about the transaction is processed to create "information" - in this case a receipt. You can imagine that the same data would also be useful to the manager of the retail store. For example, a report showing total sales in the day, or which are the best-selling products. So the data concerning all shop transactions in the day needs to be captured, and then processed into a management report.

Information

The above example demonstrates what information is.

Information is data that has been processed in such a way as to be meaningful to the person who receives it.

Note the two words highlighted in red - "processed" and "meaningful". It is not enough for data simply to be processed. it has to be of use to someone - otherwise why bother?!

Uses of Information in a Business

Businesses and other organisations need information for many purposes: we have summarised the five main uses in the table below.

Summary

This revision note has outlined the main kinds of information. It is important that you understand the difference between data and information, explain the role that information plays in a business, and distinguish between the main kinds of information.