Managing information

The theory

Accuracy is often considered to be an indication of “rightness” or “wrongness”. But in practice, when measuring, for example, a distance (kilometres), profits (dollars), or time (hours), there can only be degrees of “rightness”. The accuracy with which we can measure something not only depends on our measuring apparatus (kitchen scales or scientific balance) but on what we are measuring.

For example, how far is it from the centre of London to the centre of Nottingham? About 120 miles, using an atlas. We might get a more accurate answer from a car using the odometer but our answer would depend on the route taken. Using a global positioning device would probably give the most accurate answer but even then the accuracy depends on the definition of the position of the centre of each city. Thus there is an inherent inaccuracy in any answer which limits us to an accuracy of about ½ mile. (The map maker can be more accurate than this but isn’t bothered about a definition of the centre of each city)

So accuracy cannot be absolute and we need therefore to consider why we need the information, i.e. what decisions are to be taken, before defining the accuracy necessary. If we are wanting to calculate whether the car’s petrol tank will need filling, 120 miles is perfectly accurate, given the other uncertainties in the calculation such as fuel consumption.

Thus we can deduce the third “Principle of Information Management” (PIM).

Information needs only to be sufficiently accurate to make a decision

The implications

The major implication is that we should actually take accuracy into account when providing information. Ask a scientist to measure the width of A4 paper with a ruler and he/she should give the answer 210 ± 1 mm. This indicates that the width lies between 209 and 211 mm. Ask a businessman to quote a profit and you will get an answer like £124,675. Yet for various reasons, such as difficulty in valuing stock, the realistic answer is more likely to be £125,000 ± 3,000 i.e. between £122,000 and £128,000.

Why is providing information to an unrealistic accuracy harmful? Because it implies that it can be determined that accurately and thus implies it must be correct. Which of the profit figures quoted above would you trust? The first one probably, because it gives an impression of accuracy, while the second one gives the impression of uncertainty, since anyone quoting profit in a £6000 range isn’t confident. However, the reverse is true, the second figure is the more trustworthy, since it gives an accurate impression of the uncertainty of the number.

How to apply the principle...