The ultimate test of an information system is that there are no surprises.
The ultimate test of an information system is that there are no surprises. Before events become significant, executives have already adjusted to them, analyzed them, understood them, and taken appropriate action. One example is the very few American financial institutions that, in the late 1990s, were not surprised by the collapse of mainland Asia. They had thought through what “information” means in respect to Asian economies and Asian currencies. They had gradually eliminated all the information they got from within their own subsidiaries and affiliates in these countries—these, they had begun to realize, were just “data.” Instead, they had begun to organize their information about such things as the ratio between short-term borrowing and the country’s balance of payments and information about funds available to service foreign short-term debt. Long before these ratios turned so unfavorable as to make a panic in mainland Asia inevitable, these executives had realized that it was coming. They realized that they had to decide whether to pull out of these countries, or to stay for the very long term. They had, in other words, realized what economic data are meaningful in respect to emerging countries, had organized them, had analyzed them, and had interpreted them. They had turned the data into information—and had decided what action to take long before that action became necessary.
ACTION POINT: Identify key variables in your environment. Make sure you have intelligence information about each of these variables to minimize surprises.
Management Challenges for the 21st Century
* Source: The Daily Drucker by Peter F. Drucker