Types of Data and Purposes of Information

3.1.2 – Types of Data and Purposes of Information

Types of Data

Qualitative Information

Qualitative information is information which is not quantitative, is based on qualities or characteristics and includes opinions and impressions. For example this could be the image of a product, someone’s feelings, and the design of a car.

An example of qualitative information in my business is the name of products and the URL to the supplier’s website. Another example of this is the names of customers and if they are a platinum customer or not.

Quantitative Information

Quantitative information is information about quantity, it can be quantified and is numerical and factual. For example it could be your age, your height, and the size of a country.

An example of quantitative information is the price of shoes on my business reports. Another example is the amount of money customers have spent on my website.

 

Primary Data

Primary data is data in which you have gone and collected it yourself, this could be taking surveys, experiments or an observation. In a business it is data generated during the operations of the business. An advantage of primary data is that you know you can trust it because you’ve collected it yourself and it is also relevant. Disadvantages of this is that it is time consuming and has a cost to it.

An example of this in my business is the number of items in stock at the beginning of a day, to get this you would go and physically count them .Another example of this is getting customer names on the phone yourself to add to a customer list. Primary data is useful to specific businesses because you can collect information such as best sellers.

Secondary Data

Secondary data is information that you have found out from somewhere else, this could be watching television, using the internet and reading books and newspapers .An example of this is finding out the cheapest suppliers or highest quality suppliers. Disadvantages of secondary data are that it could not be reliable or relevant to your need. Advantages of secondary data are that it isn’t time consuming (usually) and usually isn’t as costly as getting primary data.

An example of secondary data in my business reports are the prices that people are supplying the shoes at. Another example is the brand names of the products and also images of the product.

 

 

Purposes of Information

Operational Support

Operational support is the use of information to help with the day to day running of the business.  Monitoring is knowing what is going on, for example knowing how much stock is there, how much to charge people etc. Information helps controlling take place, it gives the company information to make controls which affect the process of the business.

An example of operational support from my business report are things such as opening stock, closing stock. The opening stock allows the business to know how much stock is in when they open and the closing stock allows the shop to know how much is there when they close, this helps the business know how much is there and allows them to work out how much stock they’ve sold as well as if which helps process the ‘Reorder Message’, allowing the business to know if they need to order more stock.

Analysis

Analysis is breaking down a complex issue into parts to improve your understanding, for example trends over time, geographical differences etc.

This allows us to make good business decisions because it gives us a good and deep understanding. The manager of the company would normally do the analysis in the company, for example noticing top sellers and if the company need change location or change products etc. Good Analysis helps make decision making better.

An example of analysis from my business reports could be looking at the report to notice what’s selling well and what’s selling bad, the opening stock and closing stock allows us to see this.

 

Decision Making

Operational Decisions are the day to day business decisions that need to be made, for example making the decision if to order more stock, making deliveries etc.

Tactical decision are short term decisions that will effect the business, this could be deciding to deliver express instead of standard or more advertising, these decisions would be made by managers in the business. To make these decisions the manager would have to do an analysis first.

Strategic Decisions are long term business plans, typically made by the person in charge of the business and they have permanent long term effects on the business. This could be closing the shop and becoming an online shop or even expanding your company. Before making strategic decisions a lot of information needs to be collected and a lot of analysis needs to be done.

An example of an operational decision could be deciding whether you need to order more stock or having a sale to clear stock quickly. An example of a tactical decision are things such as advertising, delivering express or standard etc. An example of a strategic decision could be shutting the shop to become an online shop or expanding the business to open up new shops.

 

Gaining Commercial Advantage

Business comes down to making money, finding out about rival products, as well as market potential, pricing is crucial if priced too high you won’t sell a lot, if it’s too low then you won’t be making a lot of money, increasing revenue is making more profit and decreasing costs is lowering the production costs. These are all commercial advantages as they give you the advantage of making money.

An example of this could be looking at your prices and comparing them to rival products to see if the price is too high, another could be looking at stock and sales to determine whether you’re ordering too much for a certain time period. Also looking at the production costs and decreasing the costs of production to increase revenue is a commercial advantage.